Levinomics for America - The American Spectator | USA News and Politics
Levinomics for America
by

America is in a constitutional crisis as well as an economic crisis. The problem is not just Barack Obama. It is the entire Democrat party, which has been taken over by Marxists (that is a literal truth and not just hyperbole), and which caused and continues to perpetuate both crises.

The constitutional crisis is that President Obama will not follow the law. He regularly makes up the law rather than administers the law as written. He abuses the powers of his office, effectively seizing the power to rule by decree, announcing new laws or changes in the law that he has no power to make. This goes on almost daily now. Will Obama follow the law now in taking any military action against Syria?

But worse is that the entire Democratic Party is supporting Obama in this effective coup d’état, with nary a peep of any protest regarding such presidential abuse of power from any Democrat quarters. Instead, it is clear that the Democratic Party embraces what Obama is doing, and would vigorously defend it if Republicans and conservatives ever managed to mount a serious challenge to this presidential abuse of office.

Moreover, the Obama economic policies that have derailed any real recovery from the deep recession, so contrary to American history and historical patterns, and seem to have America in permanent decline now, reflect the heart and soul of the Democratic Party. It is clear the Democratic Party wants to restore the most prohibitive top income tax rates, and wants new taxes besides, such as the Value Added Tax (VAT) which would be borne by the middle class, working people, and the poor the most. Senate Democrat leaders such as Harry Reid and Chuck Schumer have even said they will allow no tax reform unless it includes yet another trillion dollar increase.

Senate Democrats have also joined Obama in trying to reverse the federal spending and budget constraints that House Republicans have already managed to force into law, which as I showed in this column recently have had a powerful impact on federal spending and deficits. Democrats also fervently support President Obama’s regulatory war on the traditional fuels that have powered America’s previous economic greatness and soaring prosperity, and other heavily burdensome regulatory barriers to restoring booming growth. Democrats also uniformly support the Fed’s reckless monetary crack policies that threaten to cause a devastating hangover once the crack is ultimately withdrawn.

As a result, first young people couldn’t find any jobs, and now their parents are increasingly being reduced to part time work. The incomes of not just the middle class, but also working people and the poor have been falling steadily throughout Obama’s entire presidency, with no relief in sight. Poverty is soaring to record levels, and the bankruptcy of the once workers’ paradise of Detroit (a Democrat political monopoly) has become the symbol of the new declining America.
INTO THIS MAELSTROM of crisis and decline steps Mark Levin, with his new book The Liberty Amendments: Restoring the American Republic. The book presents a fundamental and comprehensive solution to both crises, restoring the originally intended Constitution providing for a limited federal government, which is the most consistent with restoring economic growth and prosperity.

Levin proposes to accomplish that with 11 Amendments to the Constitution, which he advances “not because I believe the Constitution, as originally structured is outdated and outmoded, thereby requiring modernization through amendments, but because of the opposite — that is, the necessity and urgency of restoring constitutional republicanism and preserving the civil society from the growing authoritarianism of a federal Leviathan.”

Included among those Amendments is a Tax Limitation Amendment, a Spending Limitation Amendment, and a Balanced Budget Amendment. Those Amendments represent a new Libertarian, supply-side economics of economic growth and prosperity for all.

On taxes, Levin proposes a limit of 15% of income on the burden of federal taxation. His proposed Amendment states, “Congress shall not collect more than 15% of a person’s annual income, from whatever source derived.” That language includes the combination of all taxes — income taxes, payroll taxes, sales or excise taxes, and any other tax. From whatever source derived means that the limit covers investment income as well as labor income, counting all forms of the multiple taxation of investment income.

This is highly desirable, because it prohibits the mob politics of the many ganging up on the few most productive earning the highest incomes. Those at the highest incomes would still pay proportionally more under this limit. Someone earning $10,000 could be subject to maximum federal taxes under this limit of $1,500 per year. But someone earning 100 times as much at a million dollars would still be subject to maximum federal taxes of 100 times more, at $150,000 a year. The tax burden could still be skewed proportionally more to the upper income earners, but only by reducing the burden on the lower income earners. In other words, lower rates than 15% could still be imposed on those at the lower income levels, while the highest could still be subject to a top rate of 15%.

Consequently, the Amendment does not require a flat tax, but limits the depredation on any one person to 15%. Note that supply side economics emphasizes marginal tax rates as the key factor on taxes providing incentives for economic growth, especially the top marginal tax rate. Levin’s Tax Limitation Amendment is consequently wise in limiting the top marginal tax rate to 15%, as my 2011 book, America’s Ticking Bankruptcy Bomb, recommended.

The Amendment also protects more modest income earners from more burdensome taxes by prohibiting a national sales tax, as well as a Value Added Tax or VAT. It also bans death, or estate, taxes, which are inherently always double taxes on what is left after a lifetime of paying taxes. But the Amendment also wisely subjects the ruling class to maximum fury over taxation, providing, “The deadline for filing federal income tax returns shall the day before the date set for elections to federal office.”

But another proposed Amendment would concomitantly limit federal spending, stating, “Total outlays of the federal government for each fiscal year shall not exceed 17.5 percent of the Gross National Product for the previous calendar year.” Spending could still grow every year, but only to the extent the economy grows. Wisely, another section of the Amendment would also provide that if Congress fails to adopt a budget, to which the spending limit could be applied, then the spending limit that applies to all expenditures is 5 percent less than was spent the previous year.

Levin’s Balanced Budget Amendment provides, “Total outlays of the federal government for any fiscal year shall not exceed shall not exceed its receipts for the fiscal year.” As long as that remains in force, the borrowing power of the federal government is rendered inoperative, which inherently limits government. But Levin wisely provides an out which can apply in the case of war or other national emergency, providing that the balanced budget requirement can be suspended by a 60% vote by both houses of Congress.

National Tax Limitation Committee President Lew Uhler points out that President Reagan’s proposed balanced budget amendment passed the Senate in 1982 with 69 bipartisan votes. It only failed in Tip O’Neill’s Democrat-majority House by just a few votes short of the required two-thirds majority. Balanced Budget Amendment supporters would be wise to look closely at the language of that proposed Amendment, which eminent economists such as Milton Friedman and William Niskanen contributed to and supported. There is no point to trying to reinvent the wheel on what was done right before.

But a virtue of any workable Balanced Budget Amendment, Levin’s or any other, is that it renders Keynesian economics unconstitutional. Keynesian economics holds that the key to promoting economic recovery from any downturn is to increase federal spending, deficits and debt. If that sounds nuts, that is because it is. Borrowing or taxing a trillion dollars out of the private economy to spend another trillion dollars back into the economy does nothing to promote the economy or economic growth overall on net. Counting dislocation effects of the intervention, and/or the negative incentive effects of higher taxes, the result is actually an overall net drag on the economy.

Maybe that is why Keynesian economics never worked to pull the economy out of the Great Depression, which is what it was invented to do, nor has it ever worked at any other time, in America or anywhere else. Those who believe in Keynesian economics do not do so because it is logical or has been proven to work. They believe in it because it justifies what they want, or what the politicians want, which is increased spending, deficits and debt, avoiding the burden and political negativity of imposing higher taxes to pay for the increased spending.

Keynesian economics is consequently just an abuse of democracy, as well as academic freedom, and the First Amendment when it is publicly advocated, morally deserving of harsh punishment for such sustained abuse. I myself would favor public flogging of the more abusive Keynesian advocates, such as Paul Krugman. But just making their views unconstitutional would seem to be a reasonable, civil compromise.

Other Levin-proposed Amendments would further promote economic growth and prosperity. An Amendment to Protect Private Property restores the Takings Clause, providing that property may be taken by government only for public use, such as for a park or a highway, not to be redistributed to other private citizens, such as through so-called economic development programs. That Amendment also wisely provides for regulatory takings, where property is effectively taken by regulations heavily restricting its use, such as when private property is devoted to a nature preserve by prohibiting any effective use. Levin’s proposed Amendment would require compensation to property owners for regulatory takings when the regulation imposes a loss in market value of the property of $10,000 or more. But that would not apply to regulations acting to prevent uses of property that injure the property rights of other property owners, such as harmful emissions of pollution that harm use or enjoyment of other property.

Another important Amendment would also return the Commerce Clause to its original intent, which was not to grant the federal government the power to regulate interstate commerce, but to prevent states from adopting protectionist regulations on trade between states. That would sharply restrict federal regulation harmful to economic growth, while preserving the free trade among the states that has been central to American prosperity.

LEVIN’S OTHER PROPOSED AMENDMENTS all serve to restore and reinvigorate checks and balances on run away federal power. The U.S. Supreme Court hastily declared term limits for federal offices unconstitutional, warning against trying to repeatedly return to the Court with clever manipulations that might achieve the same result. Levin rewards them with the only remaining recourse, a proposed Constitutional Amendment imposing term limits on Congress and the Supreme Court.

Members of Congress could consequently serve for a total of 12 years in either the House or the Senate combined. But a separate Amendment would apply that same limit to members of the Supreme Court. That Amendment would further limit judicial abuse of power, or abusive judicial activism, not merely interpreting the law as written, but making up the law, which is effectively legislative action. The Amendment would empower Congress to override majority opinions of the Supreme Court by a three-fifths vote to do so in both houses. Moreover, it would also empower the states to do so through a three-fifths vote of state legislatures. These are critical checks and balances on what have become destabilizing judicial abuses of power.

Another Levin Amendment would restore federalism by granting states the power to override any federal statute, or any federal regulation costing $100 million or more by a vote of three-fifths of state legislatures. Think of how this could counter Obama administration abuses. The states could repeal Obamacare through such a power. They could also nullify abusive EPA regulations, such as Obama’s War on Coal, for example. The president should not have the power to conduct war against any private sector industry. War is supposed to be conducted against enemies of the United States, who would be the ones conducting war on American industries. Think of where that leaves the Obama administration.

Levin’s book provides an important breakthrough among conservatives, who have been long divided over using existing state powers to amend the Constitution by national convention, for fear that a runaway convention might rewrite the Constitution, and destroy critical American liberties in the process. Levin explains in the book that the state power for such amendment, which is how he sees his proposed Amendments possibly being adopted, not through federal action, was included in the Constitution precisely for a situation like today, when a runaway federal government breaks through the bounds of the Constitution, and threatens the nation with tyranny. Levin is so right about this, because our current Constitution has been broken by a century of rebellion and conspiracy against it by so-called “Progressives,” who actually deserve to be treated like any other rebels and outlaws. This is where the real loss of critical American liberties has become manifest today.

 

Sign up to receive our latest updates! Register


By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Be a Free Market Loving Patriot. Subscribe Today!