When the unions and their progressive supporters hit the streets in Madison, Wisconsin the news cameras didn’t have to look high and low to find the Hitler posters, they could probably spot them from a hundred yards off, but honestly, who didn’t think there would be Hitler posters at a left wing rally? But in a effort to modernize, somebody found a newspaper and saw there was some unrest in the Middle East and voila, we had comparisons to Hosni Mubarak and Mahmoud Ahmadinejad. So Governor Scott Walker, we are to believe, is acting like a dictator not a democratically elected governor working through a democratically elected legislature? Hmmm, I wonder how the public sector unions got the “rights” they ferociously cling to?
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One of the great blessings bestowed upon us by our Founding Fathers was federalism. Our federal form of government evolved from the Articles of Confederation, where states had primacy and the national government acted only with the consent of the states. This proved to be too cumbersome.
In writing the Constitution, the Founders identified very specific roles and responsibilities for the national government and left everything else to the states or the people (see Tenth Amendment). In doing so it gave the people the power of liberty through mobility. If you didn’t like the way they did things in Massachusetts, you could move to Virginia. If the people of Pennsylvania didn’t want a mass migration of people to Georgia, they needed to be careful regarding the laws that they passed so as not to alienate a large block of their constituents.
The War on Federalism
The statist, who loves government and believes government should control every aspect of our lives, hates federalism, because it weakens its control. So they attack it through the courts.
Here is their standard battle plan. Let’s the case of Gay Marriage. Vermont’s legislature approves Gay Marriage. Whether you are in favor of that or oppose that it shouldn’t affect you if you don’t live in Vermont. If you are in favor and you live elsewhere, you can move to Vermont. If you live there and are opposed you can either fight to overturn it in Vermont, or move elsewhere. That’s the beauty of federalism. If continued to its logical conclusion, some states would approve it and those in favor would migrate there, and those who are opposed would concentrate in states that would ensure that it would not be adopted in their state. You could have a raging debate, but your liberty would be preserved through mobility.
However, the statists have a different view of things. After the law is passed in Vermont by the legislature (as is proper), or made up out of thin air by the court in Massachusetts (judicial activism and improper), some couples who are married in these states move to another state. By doing so, they should leave their state sanctioned rights behind. However, what they will typically do when their Vermont sanctioned rights are not honored in, say, Tennessee they will rush to federal court and says their Constitutional rights are being violated. A court stocked with judicial activists, will find some fig leaf of justification with words like emanations and penumbras, to make a new law of the land and with the stroke of a pen, the liberties of all Americans will be swept away based on the will of the people of Vermont. You no longer can protect your liberty through mobility. You cannot go anywhere to live in proximity to like minded people and live the life you believe in. Mobility is no longer a tool to protect your liberty it is a weapon against you. People can secure rights elsewhere and use mobility to come to your doorstep and use the courts to force their beliefs on you.
Fierce Fighting
I believe that is why the fighting over these issues become so fierce and acrimonious. If something is allowed anywhere, it will soon be allowed everywhere, because of an activist judiciary. Our rhetoric has become more strident, our politics is anything but bipartisan, all because everything is being elevated to the federal level. States are becoming less and less important. If you don’t believe it ask people, who was responsible for the fiasco after hurricane Katrina? If they say President Bush, ask them to name the mayor of New Orleans or the governor of Louisiana at the time. Bush and the federal government should have been the third line of defense, not the first. The first should have been the city, then the state and then the federal government.
Back to Federalism
Show me where in the constitution it says the government should own General Motors and Chrysler. Show me where it says that a tunnel, entirely in the city of Boston should be paid for by the taxpayers of Arizona. Show me where in the constitution it says education is the responsibility not of local government but the federal government. It doesn’t. And until well roll back this juggernaut, our liberties will be crushed little by little, day by day.
This is why it is also important to guard against activist judges getting on the bench or being elevated to higher levels of the court. It is just these activist judges who are taking away your liberty to move away from those who don’t believe what you do and moving toward those you do agree with. Take note of the nomination of Judge Sotomayor to the Supreme Court.
With Citibank caving in on the subject of cramdowns, we are all about to take it in the neck. What the cramdown is, is where a bankruptcy judge can re-write the terms of a mortgage, including lowering the principal on the loan, in effect, “cramming” the loss down the banks throats.
Now I’m no fan of the banks making loans to people who shouldn’t have gotten them, but it has been a long standing principle that in a foreclosure, the bank gets the house, if you can’t pay. If the loan is structured right, that is, a good down payment then this presents good security for the bank. In return, banks have traditionally been able to offer lower rates on mortgages than on many other kinds of loans. However, if you change the rules of the game, such that banks no longer have that kind of security, what is any rational banker going to do? That’s right, raise the interest rates.
So any banker writing a mortgage in the future, will have to weigh that some day in the future his security could be taken away at the stroke of some legislator’s pen. While it is true that, Sen. Schumer’s proposed deal is only on loans in place at the time of the legislation and only if the bank and the consumer tried and were unable to negotiate different terms, it still hangs over the mortgage industry. A banker today, will have to consider that in the next thirty years of the mortgage I am about to write, there may be another serious economic downturn, and in that downturn, some legislator may decide to do this again. Therefore, I’ll add 1/4% or 1/2% to the rate to cover it, on every mortgage I write from this day forward.
Let’s recap. Government programs (Fannie, Freddie, Community Reinvestment Act, Clinton’s Justice Department, HUD) push very hard on banks to make loans to marginal lenders. The housing bubble bursts causing financial crisis and government rides to the rescue so that we can pay more for mortgages forever.
And we keep electing these people.