Laurie Thomas Vass, The Citizens Liberty Party
Part 1. Madison’s Inverted Balance of Power.
Madison’s American version of the British Constitution was influenced by the legal philosophy of Sir William Blackstone, who wrote Commentaries on the Laws of England.
Because the United Kingdom was a monarchy, Blackstone spent a great deal of his book explaining how the king acted as a non-elected counter-balance to the British Parliament.
The king is himself a part of the parliament: and, as this is the reason of his being so, very properly therefore the share of legislation, which the constitution has placed in the crown, consists in the power of rejecting, rather than resolving.
The term used to describe the king’s role in checking the power of Parliament was “Crown-in-Parliament.” Blackstone wrote, “Crown in Parliament was sovereign in all matters of concern to the British empire.”
After 1687, part of the king’s constitutional authority was assumed in the parliament’s implementation of the prerogatives of the crown. The king’s responsibility was to act as the ultimate supreme authority in British law to overrule unconstitutional acts of the Parliament.
The king’s agent in Parliament was the Prime Minister, who the king appointed.
Under the unwritten British constitution, the power of Parliament was not balanced within the institutions and agencies of government. It was balanced by the Crown in Parliament, operating outside the agencies of government, to compel obedience to the rule of law.
Blackstone wrote, “If the Parliament of Great Britain will positively enact a thing to be done, which is unreasonable, I know of no power in the ordinary forms of the British Constitution that is vested with authority to control it.”
In other words, there is no force inside the framework of the British Parliament that acts to control the actions of the Parliament. The final, supreme arbiter of power in Great Britain is the king.
If Madison had followed Blackstone’s British contract law, Madison’s central government would have been an agent of 13 state principals. Madison eliminated the basis of the British principal-agency relationship and substituted his own version of the balance of power.
As was the case in creating the Office of President, the fit between the British constitution and Madison’s constitution was not perfect. Madison inverted the balance of power by making one of the branches of government, the Supreme Court, the ultimate judge of its own powers, and also of the powers of the Congress, the President, and the states.
To summarize, in the case of the Office of President, Madison relied on his own version of the British prime minister for his concept of the American president. In his concept of balanced power, Madison substituted the Supreme Court as the sole arbiter of government power, as if the Supreme Court was the Crown-in-Parliament.
When the King surrendered to the states, in Paris in 1783, he wrote, “His Brittanic Majesty acknowledges the said United States to be free, sovereign and independent States.” The King surrendered to 13 states, not to “We, the people.”
Madison did not accept the surrender of the King as establishing the sovereignty of states. The terms used by the King would have forced Madison to admit that the 13 states had 13 individual principle-agency contracts with the King.
If Madison had accepted the independent sovereignty of the states, he could not have used his ruse of “We, the people.” Without his ruse of “We, the people,” Madison would not have been able to implement his version of the balance of power.
The balance of power was not an equal sharing of power between the two social class “factions.” Madison’s balance was a permanent balance that elevated the financial interests of the elite above the financial interests of the common class.
In his attempt to evade the sovereignty of states, Madison had to ignore 3 founding documents of the new nation, and he had to implement his balance of power without relying on Locke’s compact theory of government.
The three historical documents that Madison had to evade in his new formula of balanced power had stipulated that the 13 states had formed a contract to establish the new nation.
- The Declaration of Independence.
- The Articles of Confederation.
- The Treaty of Paris.
In the first instance, Madison’s new formula sought to balance the institutional powers of the three branches of government, without mentioning the Declaration of Independence.
Second, he sought to balance power between the new central government and the states, without mentioning the Articles of Confederation.
Third, he sought to use constitutional rules to elevate the financial interests of the natural aristocracy over the common class, without mentioning that the natural aristocracy in America was just like the nobility of Great Britain.
All three forces were interrelated and each political force affected the other forces in Madison’s scheme.
Natural rights conservatives, in 1787, correctly diagnosed Madison’s flawed concept of the balance of power, both within the 3 branches, between the two social classes, and also between the federal government and the states.
John Taylor of Caroline, in his analysis of Madison’s constitution, titled, Construction Construed and Constitutions Vindicated, wrote,
when the constitution operates upon collisions between political departments, it is not to be construed by the courts. To allow the Supreme Court to be the arbiter of its own powers perverts the very idea of compact.
Eight years into the new Constitution, the consequences of Madison’s flawed concept of his balance of power became more evident. The financial power of the elites had translated into a political power of incipient elite tyranny.
The Kentucky Resolves, of 1798, stated,
“the Constitution is a compact and each state acceded as a state. The central government should not be the exclusive or final judge of its own powers.”
As he did throughout his life, Madison played both sides of the argument about the balance of power. He wrote Article III, of the Constitution, which made the Supreme Court the ultimate judge of all laws, and he also wrote the Kentucky Resolves, which stated that the Supreme Court should not be the final judge of its own powers.
As a consequence of the way Madison balanced the 3 powers, the nation devolved into a special financial interest driven system whose operational logic was fueled by elite corruption. Special interest legislation and special interest lobbyists used the agencies of government to extract financial benefits for their clients.
Eventually, the power of the natural aristocracy evolved into global corporate power, and that corporate corruption fuels the agents in the deep state today.
Part 2. Madison’s Endemic Constitutional Corruption.
Aristotle, the third-century B. C. Greek philosopher, defined corruption as the practice of leaders who ruled with a view to their private advantage rather than the pursuit of the public interest.
Just like the 3 types of government classification of the Greek philosopher, Polybius, Aristotle also viewed the 3 possible forms of government as the one, the few, and the many. In his classification of the few, Aristotle described how it ended in corruption because the aristocracy used the government for their own financial enrichment.
Unlike the dynamic cycle described by Polybius, where the government of the few was replaced by the democracy of the many, Aristotle described the end of political society, as a result of elite corruption.
In order for a nation to pursue a public purpose, as Aristotle described, the constitution must state what the public purpose is. Madison’s Constitution did not state a public purpose, like the public purpose stated in the Declaration, or in the Articles of Confederation.
As a result, the public purpose mission of government is not defined. Depending on who sits on the Supreme Court, the public purpose can be anything that moves the nation towards a more perfect union.
For the Democrat socialists, a more perfect union is translated as a global socialist totalitarian state.
For Republicans, a more perfect union is a global, one-world market, with no national barriers to international trade.
Madison deliberately created an aristocracy for the benefit of the natural elites. But, Madison feared the democracy of the many, and his constitution truncated democratic procedures because of his fear that common citizens (the many) may oppress the natural aristocracy (the few).
In Madison’s rule of law, the cultural value of shared individual liberty, in the Declaration, was replaced with the British class cultural value of shared plunder. There is a sense of balance in Madison’s constitutional rules because the elites from both north and south all shared the social value of plundering the system.
The Rule of Law means that Americans can trust other Americans not to take advantage of them in financial and economic transactions. More importantly, the Rule of Law states that Americans can trust other citizens not do something that undermines the sovereign national commonwealth provided by the original endowment of individual liberty.
Madison’s rules substituted a principle of shared plunder and greed to exploit the system for the rule of law in the Articles of Confederation, which were based upon a shared cultural sense of fairness and citizen patriotism. The shared moral values of fairness and patriotism tended to bind common citizens to voluntarily obey the rule of law.
As described by Robert Horowitz, in The Moral Foundations of the American Republic, Madison thought that if the common class could develop a class consciousness, that the common citizens would not devolve into a dangerous “faction,” one of Madison’s favorite terms to describe social class competition.
According to Horowitz, Madison thought that,
If all citizens (working class) have the same impulse of passion and interest (as the elites), they would not divide into oppressive and dangerous factions… if (working class) Americans can be made to divide themselves according to their narrow economic interests they will avoid the fatal factionalism.”
Madison’s constitution provided the institutional separation of power that divided the working class into their narrow economic (class) interests. The separation of power was designed to balance the financial interests of the working class with the same greed possessed by the elite.
His logic was that if both social classes shared the moral value of shared plunder, then the common class would not use democratic procedures to impose their majority views on the virtuous elites.
If the common class used democratic procedures to limit the plunder of elites, then that would jeopardize their claim to shared plunder, when they won an election.
But, Madison’s concept of balance was skewed against the common citizens and Madison provided no safety valve for the common citizens to protect themselves when the system devolved into a corrupt tyranny.
From Madison’s point of view, when the proprietors of labor left the state of nature to form the social contract, they agreed that the purpose of the contract was to establish rules governing economic exchange relationships, and that the new government must have power to enforce the orderly mechanisms of market exchange.
However, rules that are based upon the moral value of greed and shared plunder do not establish voluntary allegiance to follow the rule of law. Rather, Madison’s rules of economic exchange established the constitutional basis of centralized corporate corruption, by the empowered aristocracy.
The chain of logic in Madison’s conception of the balance of power was that his first form of institutional balance between the branches and agencies of government permanently elevated the financial interests of the natural aristocracy over the financial interests of the common citizens.
The first force of balance dominated the second form of balance of power between the states and the federal government by elevating the Supreme Court to the sole, ultimate arbiter of the law.
The Supreme Court, starting with the rogue rulings of Justice Marshall, was the primary factor in American history that never allowed the issue of “states rights” to be solved, ultimately leading to the Civil War.
Marshall’s interpretation of the Constitution was that it was created by “We, the people” and not the states.
The unchecked power of the Federal government over the states allowed the third form of balance in economic affairs to perpetuate an economy based upon periodic financial panics and economic collapse, caused by the elite’s manipulations of banking power and money.
Hamilton created the First Bank as a private-for-profit corporation, that was not subject to state taxes. As a private corporation, the contracts and activities of the Bank were protected from interference, by either the states or the federal government, by the Contracts Clause.
Madison inserted the Contracts Clause so that a State would not be allowed to pass any law that “impairs the obligation of contracts.”
As a compliment to the Contracts Clause in solidifying the balance of power, Justice Marshall ruled that the Federal government, under the necessary and proper clause, could create any type of financial corporation that could possibly be seen to promote the “general welfare.”
Hamilton wrote to Washington, in 1791,
Every power vested in Government is in its nature sovereign and includes by force of the term a right to employ all means requisite and fairly applicable to the attainment of such power.
Justice Marshall, in his ruling on McCullough vs. Maryland (1819), re-stated Hamilton’s words, almost verbatim,
Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate are constitutional.
The two clauses, working in tandem, created a government of unlimited, unchecked, implied, powers that would always have the power to overrule any attempt by the states, under the 10th Amendment, to restore their sovereignty.
The Federal government was not defined by enumerated, limited, powers granted to it by “We, the people,” it was a government of unlimited, implied powers, whose agents could perform any act, as long as the act had the veneer of a “legitimate end of government.”
The government, in other words, had become Leviathan.
The underlying force that propelled the Federal Government’s activities was shared plunder. And, for many years, the corruption by the elites to plunder the system was not tyrannical because the commoners also plundered the system, when they won a majority.
Hamilton knew exactly what the role of corruption would be in maintaining elite control over economic policy.
Hamilton stated, in his 1792 dinner with Jefferson that,
Purge the Government of its corruption and give to its popular branch equality of representation and it would become an impracticable government.
The power of corruption in perpetuating elite control over economic affairs was to permanently elevate the rights of creditors over debtors, and to require that all contracts be paid in gold and silver.
Under the Articles of Confederation, it was common for a state to pass legislation that granted debt relief to farmers. Granting debt relief to the common class was not supportive of elite financial interests, and Madison sought to prevent the states from enacting debt relief for farmers with the Contracts Clause, and the sovereignty of the Supreme Court to interpret the law.
In conjunction with the Contracts Clause, Madison’s Constitution prohibited states from issuing their own paper money and from regulating the banking affairs of the central government.
In both Madison and Hamilton, the Constitution defines bills of credit to signify a paper medium of exchange intended to circulate, like money, between individuals, and between the Government and individuals, for the ordinary purposes of economic transactions.
States issued bills of credit to pay for government expenses. The Constitution forbid states from issuing bills of credit because they were not “legal tender,” as defined by the Constitution.
As a part of cementing the privileges of the natural aristocracy, Marshall ruled that when, and where, either the state, or Federal government, received state bank notes in payment and discharge of an execution, (Contracts Clause), the creditor (natural aristocracy), was entitled to demand payment in gold or silver, (Commerce Clause).
Just like the instability caused by the Supreme Court’s inconsistent application of “We, the people,” versus states rights, the unbalanced power of the financial elite caused intractable financial and economic instability in America.
The economic instability caused by the unbalanced power of the elite class was never solved in the 250 year history of Madison’s Constitution.
President Jackson stated, in 1832, that Hamilton’s Bank “makes the rich richer, and prostituted the government to the advancement of the few at the expense of the many.”
Describing the function of the central government as enriching the elites at the expense of the common class is a perfect restatement of Aristotle’s classic definition of corruption that Madison’s Constitution had unleashed on America.
President Martin VanBuren, in 1837, got to the root of the centralized elite corruption. VanBuren stated that the constitution must be amended to “stop blending private interests with the operations of public business.”
The most common form of corruption by the elites was the use of government revenues to benefit their own private projects and real estate interests. John Calhoun’s Federal legislation for internal improvements justified the power of government to appropriate revenues for private projects, as long as the project served “the general welfare and common defense.”
South Carolina Governor John Wilson, in 1822, correctly diagnosed that the doctrine of implied powers served to benefit the elites. Wilson wrote, “The friends of assumed powers (elites) regarding internal improvements claim the powers as implied.”
From the 1830’s onward, special financial privileges were built into every Federal program, leading to the power and influence of unelected lobbyists. Over time, the influence of the lobbyists grew, and as that interest grew, the concerns of the financial interests of common citizens diminished, because they were not represented in Washington by lobbyists.
As the system of representation evolved into a special interest-driven political system, the concept of government protecting the natural rights of citizens disappeared because Madison created balance between financial factions of social classes, not between citizens and the central government.
In Madison’s system there are no lobbyists or organized political parties designed to represent the public purpose of individual liberty.
In current society, the “internal improvements” morphed into industrial recruitment tax benefits for the richest, most powerful global corporations. The lobbyists for corporations were able to extract financial benefits for their clients, both in Washington, and every state legislature.
Beginning with the Viet Nam military-industrial political machine, the domestic and foreign affairs of large corporations dominated public policy to the extent that the set of financial interests was able to perpetuate a war in order to supply the military with supplies, devoid of any concept of the public purpose of individual freedom.
As a result of not being represented in government, citizens took to the streets to riot against the War, which is the first sign that the society had slipped into the despotism of a centralized, corrupt tyranny.
Unlike World War II, where the large corporations benefited from trade with Hitler as a result of a war the corporations did not start, Viet Nam was a sea change in U. S. politics. The corporations benefited from a war that they would not allow to end.
Centralized corporate corruption, as a feature of Madison’s scheme, eventually lead to a corrupt global tyranny that had the power to extract financial benefits, without the burden of seeking the consent of the governed.
From the Viet Nam era, the corporations became less and less connected to the domestic interests of the nation, and more and more connected to the interests of a global, one-world government, that they controlled through their unelected agents in the deep-state and their network of global financial institutions.
One economic result of Madison’s scheme is a continuous cycle of economic collapse. While the economic instability was a built-in feature of Madison’s system, the financial and economic severity of the economic collapse has increased in frequency and intensity, since 1964.
Part 3. The Cycle of Economic Collapse Caused by Corruption.
Madison’s Constitution is not defined by the equal application of the law to all citizens. Both the elites, in the swamp, and the Democrat socialists, follow their own rules.
Laws passed by Congress do not apply to the elites, laws apply only to the “little people.”
In Madison’s Constitution, the absence of shared trust is replaced by the common value of shared plunder. Shared plunder leads to an economy based upon short-term calculations of gain and speculation in assets.
The instability of the economy, in addition to the absence of trust, causes a cumulative, self-reinforcing economic cycle of depressions in America.
The corruption caused by Madison’s Constitution is the same as defined by Aristotle, with an added component not described by Aristotle. Not only do the elites exploit government for their own personal, financial benefit. The elites have no loyalty or allegiance to the nation’s common public good.
The elites only care about their own welfare. As a result of their selfishness, the elites have no loyalty to obey the rule of law.
Beginning with the Revolutionary War, the natural aristocracy of New England, primarily bankers and shippers, conducted trade with the enemy, through channels in Canada.
As the natural aristocracy slowly evolved from wealthy families into the corporate elite, the large monopolies of the 1880’s used monopoly power to take advantage of common citizens. During the debt-peonage system, thousands of common farmers lost their farms to the bankers and credit merchants, due to the unfair debt laws.
During the Second World War, the major U. S. corporations built ships and airplanes for Hitler.
During the Viet Nam War, the military industrial complex benefited from war production, and caused the war to continue, under the false rubric of the threat of communism. The objective fact that the War needlessly killed 58,000 common citizen soldiers did not matter to the corporate elites.
The era of the Viet Nam military industrial complex marks the beginning of the so-called Republican neo-con political movement, that skews American foreign policy to engage in useless wars.
The corporate elites benefit financially from the wars, while the common soldiers fight the wars, and die.
In addition to the unequal application of the rule of law in America, the second source of corporate power is the ability of the elites to control the supply of money, (M2), and the Federal Reserve banking system, which operates just as Hamilton’s First Bank did, as a private for-profit corporation, disconnected from the consent of the governed.
That type of private control over the nation’s money and fiscal policies leads to a predictable cycle of economic collapse, about every 10 years. The macro economic instability is caused first by a predictable sequence of events, beginning with a period of a rapid increase in money supply and an increase in fiscal spending and debt issuance.
The loose money policies cause a period of asset speculation and inflation.
The speculation leads to a gigantic bubble in assets and the creation of synthetic investment instruments, which then burst, causing aggregate demand to collapse and asset values to plummet.
Agents in the U. S. Treasury then proceed to manipulate interest rates and money supply, primarily to the benefit of banks and corporations.
In the period of the bubble burst, common citizens lose their houses and their farms to the elite, due to the way the creditor/debtor laws are written to benefit the bankers. Bankers, and creditors, then proceed to foreclose on the property and assets of common citizens, who cannot make their debt payments.
During the period of asset speculation, the rate of private capital investment collapses, causing economic decline in the 3 to 5 year horizon, as capital is shifted from productive investments that lead to long-term capital gains, to investments in speculative assets in hopes of a short-term capital gain.
One consequence of the control over banking by the elites is that they use the government to insulate themselves from the damage that they inflict on common citizens.
During the period of economic collapse, the common citizens become financially destitute, and seek welfare assistance from the government.
As predicted by President Jackson, the concentration of wealth, and the distribution of income, becomes more and more concentrated in the hands of the few.
Rather than a fair balance of power between two social class financial factions, Madison’s constitution created a perpetual advantage for the natural aristocracy. The natural aristocracy used that power to seek short-term capital gains, not long-term prosperity for all citizens.
Part 4. Madison’s Legacy of Economic Collapse.
Charles Beard argued in his 1913 book, An Economic Interpretation of the Constitution of the United States, that Madison assumed that elite commercial and financial interests were the primary forces that needed to be balanced against the non-elite social classes, in the three branches of government.
Beard showed that the 37 Founding Federalists all had a personal vested financial interest in skewing the results of the new constitutional rules to suit their own needs, while at the same time, attempting to ensure stability in the government by establishing rules of procedure that balanced financial factions against each other.
Not one common farmer was present in Philadelphia during the secret deliberations of the Convention, and not one common citizen signed the document. The economic and financial interests of farmers were not represented, only the elite interests, who wrote the unfair rules, were represented at the Convention.
Financial and economic stability, as described by Beard, means political advantage for the elites. Madison succeeded in creating perpetual constitutional rules that can never be revoked by citizens, through democratic procedures, even when it becomes obvious that the rules are destructive of the ends that they were intended to achieve.
Madison’s rules did not create a free enterprise competitive market. His rules created an unbalanced economy, directed by elites, who deployed their natural rights of property to gain unchecked power over the economy.
In a historical re-play of the British Privy Council’s argument about virtual representation of the colonies, Hamilton wrote that the elites would fairly represent the interests of the non-elites. Hamilton had a profoundly elitist, collectivist, interpretation of society, more suited to European feudal society than to the individual natural rights society of America.
Hamilton explained the benefits of virtual representation in the constitutional arrangement for the elites.
He wrote in the Federalist Papers,
all parts of society were of a piece, that all ranks and degrees were organically connected through a great chain in such a way that those on top were necessarily involved in the welfare of those below them.
Madison, in a related Federalist Paper, took the exact opposite side of the argument about tyranny.
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.
As a result of the Supreme Court’s superior power to interpret the law, and as a result of Madison’s two-party, first past the post election system, all powers, legislative, executive, and the judiciary, are in the hands of the elite.
It is this consolidated, centralized, power that the Democrat socialists today seek to inherit from the elites.
For about the first 200 years of the nation, the tyranny by the elites led to economic collapse for common citizens about every 10 years.
The nation’s banking system collapsed in 1813, as a result of the First Bank’s corruption in speculative investments, and the mal-appropriation of Indian lands in Michigan and Ohio.
The banking system, and economy, collapsed again in 1819, as a result of the bank’s securities becoming worthless. Because European bankers owned securities issued by the 1st Bank, the collapse in America’s banking system quickly spread to Europe, leading to an international financial collapse.
As a result of the collapse in 1819, the first wave of land appropriation of farm land by the bankers occurred, as farm prices collapsed, and farmers could not pay their debts.
The Tariff of 1824, designed to protect northern financial interests, caused the wholesale price of cotton in the South to drop from 18 cents to 9 cents. Farmers, and the plantation elite, in the South, suffered a prolonged depression.
The Tariff of ’24 marked the first phase of the irreconcilable financial split between northern and southern elites, which culminated in the Civil War.
The U. S. banking system collapsed again, in 1836. As a consequence of this collapse, President Jackson was able to muster enough political support to kill the 2cd Bank.
Agricultural land and commodity prices collapsed in 1837, leading to the longest depression in U. S. history. The 1837 collapse led to the second great wave of land appropriation by the elites, in conjunction with the land appropriation of Indian lands in the middle of the nation, after Jackson forcibly removed the Indians to Oklahoma.
During the financial panic of 1857 the bond notes issued by 1400 state banks became worthless. During this collapse, 5000 businesses failed, leading to the first wave of massive unemployment of common workers in U. S. metro regions.
In the aftermath of the Civil War, the economy of the south was in a state of economic depression for 50 years. One consequence of that depression was that thousands of farmers lost their lands in the debt-peonage system, and were forced to work in the textile and tobacco industry, in an economic system called “neo-slavery.”
In his book, The Mind of the South, C. Wright Mills correctly described this era as the re-establishment of the Plantation Aristocracy in the mills, achieved by brute force and racial apartheid.
The 250 year period of economic instability in America changed in 1964, with the shift in political power to global corporations, who exerted power in Washington with the agents of the nascent deep state.
Beginning with the 1987 stock market collapse, the cycle of economic instability became more frequent, and more intense.
As the corporations extended their political power, they were successful in implementing tax and trade policies skewed to their benefit. Between1985 and 1992, changes in tax and trade policies led to increased rates of production jobs lost due to offshoring and outsourcing.
Metro regional value chains, and interindustry linkages, among small manufacturing firms were destroyed.
As a result of the hollowing out of U. S. manufacturing, the employment and income multipliers, that formerly spread wealth throughout American society, were destroyed.
The production that used to be done in the U. S. was now done in foreign locations. The beneficial economic flows, the so-called “trickle-down effect,” in the American economy became concentrated in the top 15% of the population that was connected to the global trade patterns.
The other 85% of the population turned to the “gig” economy to survive.
As a result of the trade policies, the economic platform for U.S. technology R&D and new technology product development shifted to U. S. branch manufacturing plants in India and China.
On October 19, 1987, the Black Monday Stock Market Crash occurred. The cause of the crash was banking collusion with agents of the deep state, asset speculation, insider trading and program trading by 5 large global securities firms.
In 1991, the speculative real estate bubble, and the leveraged buy-out bubble, both burst at the same time, causing the recession of 1991.
Beginning in 1991, the American economy began to enter a series of speculative bubbles caused by government banking policy intervention, in its attempt to restore macro aggregate demand, through increased government spending.
As a result of the government spending, the frequency of economic collapse shortened from every 10 years to about every 5 years.
The capital gains and profits from the exits in IT investments, initially made in 1992, were ploughed back into short-term speculative early stage IPO investments, in 1997. Speculation and collusion in the IPO market dumped hundreds of millions of worthless IT securities into the public markets for ordinary American investors to buy.
The government intervention and increased spending, in 2001, did not create lasting benefits because domestic markets and the global economy were no longer integrated.
After the Islamic terrorist attack, on September 11, 2001, the US. stock market collapsed again. The U. S. economy entered a prolonged recession.
Again, the U. S. government tried stimulus spending, which ended up primarily benefiting special financial interests in foreign counties.
In 2002, U. S. trade and tax policies were changed to facilitate more offshoring of technology innovation and R&D. The changes in regulation of corporations led to a series of Enron-type collapses and wide-spread corporate financial accounting fraud.
In the period from 2003 to 2008, the U. S. rate of job creation was lower than the rate of job destruction.
Beginning in 2003, the U. S. rate of domestic direct investment declined, and U. S. foreign direct investment increased.
In 2004, the U. S. rates of profit for the 1500 largest global corporation increased to record levels. As a result of U. S. trade and tax policies, those record profits were not repatriated, or reinvested, in U. S. domestic value chains. The record profits were reinvested in foreign global value chains.
The trade policies and increased foreign capital investment had created a bifurcated domestic economy. A large part of the domestic economy did not benefit from transactions in the global corporate value chains.
Beginning in March, 2008, speculation in oil and gas increased the price of a barrel of oil from $43 per barrel to $145 per barrel. The asset speculation was a result of collusion between oil corporations and government officials, aided and abetted by a useless war in Iraq and Afganistan.
The rapid increase in oil prices caused a sharp contraction in consumer spending. The decreased consumer spending caused aggregate demand to collapse, causing a prolonged economic recession.
In September 2008, the mortgage debt bubble, directly caused by U. S. government banking and interest rate policies, burst, and the U. S. economy collapsed again.
As a result of that collapse, and coincident with the election of a socialist president, the U. S. economy did not experience growth for the next 8 years.
In the system of government in America, the only time common citizens directly benefit economically from Madison’s system is when they have a path of upward occupational mobility, caused by economic growth.
In the absence of economic growth, between 2008 to 2016, citizens became attracted to the ideology of socialism, which resulted in 65 million citizens voting for the socialist candidate for President, in 2016.
Part 5. Eliminating Corruption in the Natural Rights Republic.
Eliminating corruption in the natural rights republic means eliminating the source of corrupt power in Madison’s Constitution. The source of corruption is the elite’s control over the banking and monetary system.
The aristocratic American government created by Madison was politically stable as long as the well born created economic growth. Citizens have not had these conditions since 2008. In the absence of economic growth, citizens have needlessly suffered economic failure.
There is an obvious economic relationship between individual freedom and economic growth, commonly called the competitive free market.
The creation of individual freedom, defined by Jefferson’s Declaration, occurs at the beginning of the constitutional exchange relationship, not in the welfare outcomes that result from the ensuing economic exchanges. This concern about the initial conditions of the constitution is the primary reason why the ensuing economy creates economic growth.
The economic growth is caused by Locke’s right of private property, which unleashes individual initiative and ingenuity. The common phrase for that individualist ideology was “Yankee ingenuity.”
“No one is born into moral subjugation to political power,” stated Jefferson. When citizens leave nature to create their government, “all men are created equal… in nature all humans are equal…not subject to the rightful authority of any other human being…in a state of nature no rightful authority exists in nature. No man is subjected to the will or authority of any other man,” he wrote, over and over again, from 1776, to the very last letter he wrote in 1826.
No set of policy reforms will ever overcome the flaws of an unbalanced and unfair set of constitutional rules that operated within the social class system built by Madison. His system did not launch a free competitive market, where all citizens benefit from economic growth.
What Madison overthrew, in 1787, was the voluntary exchange economy of the Articles of Confederation, where common citizens could freely gain the value of their labor (property).
Madison replaced the Articles, which was based upon equal commercial exchanges, with government rules, where the elites dominated the terms of exchange with their unbalanced, and unchecked government power.
The threat to individual freedom in the natural rights republic arose from Madison’s Constitution because one party (the elites) gained the illegitimate ability to subjugate the sovereign life path of the less powerful party (the non-elites), at the very start of Madison’s Constitution of 1787.
The intractable political problem Madison left the nation grew worse after 2008.
After 2008, the Republicans abdicated their historic mission of protecting the social class rights of the natural aristocracy, and became a global corporatist political party. The ideology of the Republicans centers on the neo-con fascination with starting wars.
After 2008, Obama converted the Democrat Party into a globalist socialist party.
Madison did not anticipate that American leaders would abandon allegiance to the nation, in favor of loyalty to a global, one-world government.
As a consequence of these two political developments, the citizens of America do not have a legitimate choice for a party to represent their interests, or the sovereign interests of the nation.
Madison unleashed a perpetual class war in America between the elites and the non-elites that is still a class war, but it is now a class war in a global setting. The corruption of his system is exactly as predicted by Aristotle, an aristocracy that ended in corruption.
There are no rules identified in Madison’s Constitution to “alter or abolish” this corrupt incipient global socialist tyranny.
Both the globalist Republicans and the globalist Democrats ideologies are irrevocably and irreconcilably incompatible with ideology of individual liberty in the natural rights republic.
The only peaceful, non-violent solution is to allow the socialists to leave America, in order to form their own more perfect union.
After the socialists leave, natural rights conservatives can start over with a new Constitution for The Liberty States of America that has better rules for the balance of power than those created by Madison. And, which compels voluntary allegiance to the rule of law based upon shared cultural values of freedom, and not corruption.
Part 6. Barriers to Corruption in the Constitution of the Liberty States of America.
The first check against corrupt tyranny in the Liberty States of America is to place the issuance of charters under the consent of the governed. Because the House represents the interests of citizens, the House gains the constitutional power to regulate trade practices.
The House has the exclusive authority to regulate the issuance of charters for interstate and international commerce. The House may impose restrictions, sanctions and revocations of charters for trade practices that are contrary to the sovereignty and welfare of citizens or the states.
The second barrier to corrupt tyranny is to revoke the ability of the elites to borrow money to increase government spending.
The National Congress shall have the power to issue government bonds, and to borrow money on the credit of the Liberty States of America. All proposals to borrow money or issue debt shall occur once in the two year budget cycle, and all proposals to issue debt must be approved by 50% of the State legislatures of the Liberty States of America, no later than January 21 of the year of issuance.
The term of debt and interest on any issuance of debt shall not exceed 10 years, and must be paid in full by the end of the 10th year.
The third barrier to corruption is to eliminate the elite power to increase the supply of money, and to control interest rates that benefit the corrupt tyranny.
The National Congress shall have the power to coin money, regulate the value thereof, regulate the circulation and creation of money and money instruments, regulate the national banking system and establish the currency value of foreign coin, and fix the Standard of Weights and Measures.
The fourth barrier to corruption is to place the banking system and the Federal Reserve System under the control of the House. The House is given an explicit mission to promote economic growth.
The House has the exclusive power to charter and regulate a system of national banks designed to promote interstate and international commerce and maximum rates of economic growth among all Liberty States. The House imposes restrictions on the domain of power and authority of the system of national banks, and restricts the domain of the bank’s authority to promote the economic welfare of sovereign Liberty States and sovereign citizens.
These four provisions in the new constitution work in tandem with the public purpose mission of the Constitution, stated in the Preamble,
We, the citizens of the Liberty States of America, establish this constitutional contract between our respective states and the National Government of the Liberty States of America.
We solemnly swear and affirm that we establish this contract to preserve and protect the natural and civil rights of citizens in each state, and to protect and defend the sovereignty of each state and the nation, from foreign and domestic threats.