Home Building & Loan v. Blaisdell (1934) – Guest Essayist: James D. Best

Home Building & Loan v. Blaisdell (1934) started the modern trend of interpreting the Constitution to support popular passions. You can read the essay here or listen to it below.

Primer on Electoral College

The Electoral College is an integral element of our governing system. The purpose is to give people who live in all the states some influence on the executive leadership of the country. After the recent election, many are questioning the wisdom of Article II, Section 1. The Electoral College is immensely important not only to who wins, but how presidential campaigns are run. Eliminate the Electoral College and the interior will never see another candidate in their state and heartland primaries will be meaningless.

Inhabitants of the hinterlands often feel dismissed by urbanites living along one of the two coasts. Unfortunately for our country, the hue and cry to do away with the Electoral College confirms their worst suspicions.  Abolishing the Electoral College will disenfranchise every American who lives in fly-over country.

Here is a good primer on the Elector College.

Should Government Pay for Higher Education?

Since government provided higher education has become a hot topic, perhaps Milton Friedman can provide some advice. 

Alexander Hamilton Fixed a Broken Nation

Due to the groundbreaking play, Alexander Hamilton has vaulted skyward to become an icon of popular cultural. It couldn’t happen to a better man. Hamilton was my favorite character when writing Tempest at Dawn. At the time of the Constitutional Convention he was only thirty years of age, yet he had already proved his physical courage and mental agility.

When writing my novel, I used the following excerpt to illustrate the economic conditions faced by the infant nation. Most of the states had not paid off the war bonds that financed the Revolution, foreclosures were rampant, inflation raged, there was no common money, and production, especially for ships and foodstuffs, had declined to the point of alarm. These were the dire circumstances inherited by Alexander Hamilton when he became our first Secretary of the Treasury. In a tour de force, he righted the country’s finances and economy by the end of Washington’s first term.

When Baldwin emerged from behind the building, he failed to notice his friends on the other side of the road, so he walked into the tavern. He spent only a few minutes inside and emerged with a wooden bowl and an oversized spoon. Looking around, he finally spotted Sherman and Hamilton on the log across the way.

As he took a seat next to Sherman, Baldwin asked, “What’s this?”

Hamilton leaned forward to look around Sherman. “Squirrel, I think.”

“God, I hate traveling.”

“Throw it away, and I’ll give you a pear.”

Baldwin dipped his spoon deep into the concoction and let the goo plop back into the bowl. “This looks like pig swill.” He ceremoniously turned the bowl over, and they all watched the pottage spill onto the ground in bumpy chunks.

“My money says that blob will still be there on my return trip,” Hamilton said.

Baldwin turned the pear a couple times and then took a huge bite. After a noisy chomp, he spoke with a mouth half full. “I’ll not take that bet; forest animals have more dignity.”

Power To The Regulators!

The Founders believed that consolidating executive, legislative, and judicial powers would threaten liberty, so to avoid this tragedy, they built our constitutional framework with checks and balances. James Madison, the Father of the Constitution, wrote in Federalist 47 that “The accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, self-appointed, or elective, may justly be pronounced the very definition of tyranny.”

Whew! Thank goodness we avoided that kind of government.

On second thought, we didn’t. Despite the Founders best efforts, Congress has concentrated executive, legislative, and judicial powers into regulatory agencies. Lazy legislators pass vague laws and then permit regulators to fill in the devilish details. Many of these regulatory agencies employ their own adjudication panels with internal appeal boards that judge the rightness or wrongness of their own actions. (A final appeal may be made to outside courts, but usually not until all of the agency’s protocols have run their course.) Lastly, regulatory agencies execute their own interpretation of laws, with—if White House responses to regulatory scandals are to be believed—no oversight by the top executive.

Surely, this can’t be right. It would violate every precept of the Founders.

Unfortunately, it’s true. In fact, amassing vast powers in regulatory agencies has become so commonplace, few take notice anymore. At least, few took notice until the Consumer Financial Protection Bureau raised this liberty-sapping drift to a brand new level.

Death and Taxes

 “In this world nothing can be said to be certain, except death and taxes.” Ben Franklin

Franklin made the above quip many times, always to approving nods. Complaining about taxes is as American as apple pie, Thanksgiving, and NASCAR. After all, the Revolution started over a three pence tax on tea. Here is an excerpt from Tempest at Dawn that shows the Revolution didn't revoke Franklin's immutable law.

The owner of the Indian Queen appeared instantly. Bowing respectfully, he asked, “Gentlemen, is there anything else you desire … another ale, tea and cakes, a plate of cheese? We have excellent cognacs.”

“No, no,” Morris said. “We’re ready to retire. Thank you for your hospitality.”

The innkeeper never looked at Morris; instead he aimed a witless grin at Washington.

“My pleasure. The general’s always welcome at the Indian Queen.”

All evening, Madison had found the Innkeeper’s solicitous behavior irritating. Now he was amused by his inadvertent slight toward the rest of the party. Washington often elicited bumbling adulation.

“Thank you,” Washington said, with a regal nod of the head. “We’ll be in Philadelphia for a spell, so we’ll visit your fine establishment again.”

“Yes, the Federal Convention. A noble endeavor. My best wishes.”

“And what might those wishes be?” Washington asked.

Liberty and Private Property

“The pillars of our prosperity are the most thriving when left most free to individual enterprise.” Thomas Jefferson

The Founders were firm believers in private property rights.  In their minds, private property rights and liberty were intertwined.  Does this make sense?

Let’s go back to 1776.  At the time, we revolted against more than the British; we also revolted against Divine Right.  A short time earlier only nobility owned property and the great mass of humanity were serfs.  As this system withered, the common man developed property rights, and with property, gained political voice.  The Enlightenment preached that all men possessed God given rights, including the right to own property. By the second half of the eighteenth century, most British subjects equated property rights with liberty because they had seen that one followed the other.

In their view, prosperity and broad distribution of wealth depended on the protection of private property.  Even before the Declaration of Independence, the Virginia Declaration of Rights led off with “all men are by nature equally free and independent and have certain inherent rights, of which … namely, the enjoyment of life and liberty, with the means of acquiring and possessing property.”

James Madison said, “The government is instituted to protect property.”

Slavery in the Constitution

If Founders believed in the Founding Principles, then they knew in their heart that slavery was the epitome of oppression. Slavery denied other humans the exercise of their liberty, which the Founders understood to be precious. Yet it was a slaveholder who wrote, “All men are created equal, that they are endowed by their Creator with certain unalienable rights.”

Slavery is a difficult issue in our nation’s history. The Founders, especially the Constitutional Framers, have received censure for not taking greater action against slavery. Some of the more prominent Founders are denigrated because they owned slaves. How can the Founders comments be reconciled with their actions? The answer is not simple.

Slavery at the Founding

At the time of the Constitutional Convention, slavery was illegal only in Massachusetts; more than two hundred slave ships regularly sailed out of New England; and over half of the wealth in the South comprised slaves. Both England and the North held a large amount of loans collateralized by slaves. In 1787, slavery was widespread, and a major element of the economy in both the South and the North.

Despite the position of slavery in 1787, many of the Founders believed slavery was already on its way to extinction. The slave trade had been made illegal in ten of the thirteen states. All thirteen states were seeing an increase in free blacks, especially in the North and the frontier areas of the South. Between 1775 and 1800, the number of free blacks in the nation increased from fourteen thousand to one hundred thousand. Virginia had passed legislation that freed slaves who served in the army or navy. In 1780, Quakers in Pennsylvania pressured the state legislature to pass a law declaring all children of slaves free. With the importation of additional slaves prohibited in most of the country, declining slave labor economics, and growing pressure to declare the newborn of slaves free, most of the Founders didn’t want to jeopardize the union over an institution that was already dying. For this reason, even staunch abolitionists like Benjamin Franklin only made peripheral swipes at slavery during the Constitutional Convention.

Fear of an Overly Powerful Government—As American as Apple Pie

Advocates for limited government are accused of wanting no government. It’s a straw man argument that in essence says we must keep every little piece of government or nothing at all. Limited government advocates do not want to eliminate all government, they only want to return government to its rightful place.

The Founders didn’t fear powerful government because they hated government; they feared powerful governments because they threaten liberty. This has been true throughout history. The more power government wields, the more it dictates the daily activities of its citizens. Big government doesn’t sometimes oppress. Sooner or later, big government always oppresses.

Today, many people believe the government should take care of them. The government should right every wrong and insure a fair distribution of necessities. The sad truth is that making sure everyone has shelter, food, health care, training or education, protection against disability or unemployment, and a risk-free retirement is expensive. Government services in excess of national income can work for a long time—decades even. Basically, it’s a sly way of buying votes with the next generation’s money. Unfortunately, it can’t last. Once the interest on the borrowed money starts claiming a big piece of the current budget, the responsibly can no longer be foisted onto the next generation, and the fiscal charade begins to crumble.

Book Review: Freedom’s Forge—How American Business Produced Victory in World War II

“Leave nothing to the uncertainty of procuring a warlike apparatus at the moment of public danger.” George Washington Fifth Annual Message to Congress

Freedom’s Forge by Arthur Herman is a celebration of people who know how to build things. The book is filled with characters that seemingly came from Ayn Rand’s novel Atlas Shrugged … except these Americans were not fictional. They were real industrialists and miracle makers. In 1939, the United States possessed only skeletal armed forces, ranking eighth in the world behind tiny Holland. Production plants in the United States had become obsolete or run down by depression and harmful tax policies. America was ill-prepared for war and did not have factories that could change the situation. By 1942, from this standing start, American industry was producing more war materials than Germany, Japan, and Italy combined, and by the end of the war the United States had manufactured two-thirds of all war materials used by the Allies.