Sorry Folks, Independence Day Is Canceled

“Well, Doctor [Franklin], what have we got—a Republic or a Monarchy?”

A Republic, if you can keep it.”

This week’s Independence Day celebrations mark quite the contrast with the modern bureaucratic nanny state, with the all-powerful centralized government we actually have.

We’ll wave flags symbolizing commonality with our nation’s founders who threw off the yoke of Britain and declared themselves independent at great cost and blood.

While the Fourth of July holiday celebrates individual liberty and the freedoms and rights that allow us to achieve and prosper, we jettisoned the decentralized government the founders secured for us. We decided to procure new masters in Washington rather than keep the Republic.

The nanny state and entitlement society prevail in our personal and economic lives, embodied most prominently in Obamacare’s ongoing collectivization and centralization (pick your term) of private medicine and insurance. A grown up, adult 26 year old still on a parent’s insurance policy because of government decree may be celebrating many things, but not independence.

In our post-Constitutional era (yes, post: see Charles Murray’s new By the People: Rebuilding Liberty Without Permission), our “laws” spring not from an elected Congress but from unelected bureau personnel and the president’s “pen and phone.”

Name something off-limits for the federal leviathan; Not health care, schooling, retirement, finances, housing, energy, work life, wages, infrastructure, R&D, the Internet. Even more middle class entitlements are sought; just go back and read President Obama’s last two State of the Union Addresses. Still, the phenomenon is bipartisan.

Post-Constitution, the doctrines of separation of powers and checks and balances have devolved into a societal rock paper scissors game, with no stable equilibrium by which liberty prevails. At least a playground rock paper scissors game is zero-sum; applied to government, each branch grows more powerful over time.

Alarm appears across the policy spectrum, from a House Republican lawsuit against Obama’s unilateral actions, to Georgetown law professor Jonathan Turley telling the House Judiciary Committee that “We are in the midst of a constitutional crisis with sweeping implications for our system of government.”

Outside the Beltway (the richest area in the nation, but what is anyone going to do about it?), hiring and economic growth continue to suffer. Home Depot HD +0.03% co-founder Bernie Marcus told Investor’s Business Daily that:

Having built a small business into a big one, I can tell you that today the impediments that the government imposes are impossible to deal with. Home Depot would never have succeeded if we’d tried to start it today. Every day you see rules and regulations from a group of Washington bureaucrats who know nothing about running a business. And I mean every day. It’s become stifling.

What sorts of impediments?

  • Most obviously, and now affirmed by the highest Court in the land, the Department of Health and Human Services and the Internal Revenue Service will continue transforming America’s traditional medical system via the Patient Protection and Affordable Care Act. The employer mandate triggered by the federal subsidies the Supremes validated has yet to kick in. In the future, the pertinent question may be, “what employers?”
  • Dodd-Frank institutionalizes “too big to fail” finanical entities it pretended it would to prevent. It creates instability and damages access to banking services;
  • The Federal Communications Commission’s (FCC FCC) “net neutrality” rules threaten free speech and infrastructure investment just in time to avert the downsizing and sunsetting the FCC actually needs.
  • Energy regulation and green extremism disrupt access to land and resources, aggravate energy poverty and even foster food shortages;
  • The homeland security culture has wrought a cabinet department, demeaning airport security, general surveillance and an as yet incalculable impact on civil liberties;
  • Antitrust agencies disrupt competition while pretending to protect it despite the modern technological era’s rapid pace of “creative destruction”

The list goes on, from the Consumer Product Safety Commission’s proposed window blinds regulation to FDA’s regulation of serving sizes for breath mints.

Congress permitted this power grab and subjected us to ”regulation without representation,” not the Independence we celebrate while averting our eyes (see David Schoenbrod’s Power Without Responsibility).

In  his Is Administrative Law Unlawful?, Philip Hamburger shows that the United States Constitution expressly bars the very delegation of legislative power that Washington now breathes like air. He depicts the modern administrative state as a reemergence of the absolute power practiced by pre-modern kings. Such monarchical prerogative squares not with political independence but servitude.

The combination of the progressive victories on behalf of the rule of “experts,” inertia by those who should have stopped it, the decline of individualism in favor of a “society organized for collective action” as Justice Clarence Thomas referenced it, and a ratchet effect that expands and never reverses government power indicate that a resurgence in constitutional order is not in the immediate offing.

Fireworks pop, but the Declaration and Constitution are not coming to the rescue this July 4th.

States are increasingly aware that the Constitution’s Article V affords them an opportunity to amend the founding document to reduce the federal leviathan and reestablish accountability for the regulatory bureaucracy. That, and maybe that alone, changes the rock paper scissors game drastically.

For the time being, we shall be optimistic about individual liberty’s prospects and an escalation of democratic accountability using existing tools like the ballot box. But as William A. Niskanen made clear in Market Liberalism:

More promising than any identifiable change in the regulatory process would be a revival of the constitutional doctrines limiting restraints on interstate commerce, restrictions on private contracts, the uncompensated taking of property rights, and the undue delegation of policy decisions to regulatory agencies.

We can have a Happy Fourth of July no matter what; but only a “revival of constitutional doctrines” enables an Independence Day.

(Note: For more info, see One Nation, Ungovernable? Confronting the Regulatory State,” which appears in the Fraser Institute book What America’s Decline in Economic Freedom Means for Entrepreneurship and Prosperity.)