Taxes, Warlordism, and The Federalist Papers

PD Shaw posted this as a comment to my AIG post, and David Blue (and others, including me) think it’s worth posting for more discussion. here’s James Madison from Federalist Papers #44:

Bills of attainder, ex post facto laws, and laws impairing the obligation of contracts, are contrary to the first principles of the social compact, and to every principle of sound legislation. …

Very properly therefore have the Convention added this constitutional bulwark in favor of personal security and private rights; … The sober people of America are weary of the fluctuating policy which has directed the public councils. They have seen with regret and with indignation, that sudden changes and legislative interferences in cases affecting personal rights, become jobs in the hands of enterprizing and influential speculators; and snares to the more industrious and less informed part of the community. They have seen, too, that legislative interference, is but the first link of a long chain of repetitions; every subsequent interference being naturally produced by the effects of the preceding. They very rightly infer, therefore, that some thorough reform is wanting which will banish speculations on public measures, inspire a general prudence and industry, and give a regular course to the business of society.

This is a hill to die on; not only is it horrible policy (for the reasons I stated, which have been repeated by Michael Lewis, Tyler Cowan, and others), but it really does smell to high heaven of bannana-republic warlordism.

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29 thoughts on “Taxes, Warlordism, and The Federalist Papers”

  1. This probably sounds like an argument from conservatives premises, but I think not. Madison is identifying a body of laws that British Parliament enacted that were deleterious of individual liberty, served as traps for the disadvantaged and money-making opportunities for the connected.

    Oddly, while the British Parliament can still enact bills of attainder, they have not done so since the 18th century. Without court or written constitution the Parliament must exercise restraint. Our politicians appear to have become infantilized by the expectation that the Courts will either fix things or take the heat.

  2. This part troubles me though:

    bq. They have seen, too, that legislative interference, is but the first link of a long chain of repetitions; every subsequent interference being naturally produced by the effects of the preceding.

    I’ve generally supported a number of the bailouts, even thought the money to keep Detroit afloat seemed acceptable just to give us a little time to see if there were any other options (looks like no). I may have rejected the final product (like the stimulus package), but I can’t pretend that I’ve taken anything close to a non-legislative interference position.

    But does such interference necessarily lead to banana republicanism? Or is the present social climate so severely stressed that we can’t trust ourselves to exercise restraint. Nor do we appear able to exercise the testicular veracity to help save a company we hate.

    I readily acknowledge the other implication. One punitive, retroactive tax against an unpopular minority will breed more.

  3. bq. One punitive, retroactive tax against an unpopular minority will breed more.

    Yep. Not only has the mob failed to consider the immediate consequences of their behavior, they’ve completely ignored the precedent being set.

  4. That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it, and to institute new government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness.

  5. Re: “a hill to die on.”

    The world is ending. But I am old fashioned enough to say: Long live the new world.

    May God defend the right.

  6. That’s disturbing to me for two reasons, Tim. One, it’s just completely disheartening to think that we’ve reached this point. Two, what kind of government can we expect as a replacement, with the type of frankly imbecilic mob that’s chanting outside the gates?

  7. When Clinton signed the retroactive tax hike I thought to myself what a terrible precedent was being set. Now this. Even if the proposed AIG tax bill fails to pass, the same tactic will be tried again and again with increasing success. It will succeed because the people want it to succeed. It will succeed because the people have no principles.

  8. bq. …it really does smell to high heaven of bannana-republic warlordism.

    The conservative base screamed to high heaven that this is where we would head under The Won. This guy and his crew from Chicago, students of Alinsky and ‘Uncle’ Frank that they are, are fiddling while The Republic burns. They are playing their “Progressive” games and do not care if they destroy the thing they are trying to “improve” as long as their dogma is followed. The geniuses in Congress (both parties) ram a law stamped “Massive Fail” through in record time without allowing time to even review it at the most basic level. Then one of the provisions in that same bill is a stinker that is unpopular and they play Kabuki theater games of blame that are so misdirected as to be laughable except for the fact that someone could really be “hurt”:http://nymag.com/daily/intel/2009/03/busload_of_crazies_to_tour_hom.html?imw=Y&f=most-emailed-24h5

    When is the MSM and those who supported this Obamnation going to do the real vetting of the ‘Teleprompter President’ they should have done before the election? Hmm? When the entire fabric of the society is in tatters because of class warfare engendered by the one who is supposed to lead it? We tried to warn you but you were lost getting in touch with your feelings – those ones running up and down your leg were not arousal but signs you were beclowning yourselves.

    PD Shaw @1 above:

    bq. This probably sounds like an argument from conservatives premises, but I think not.

    PD – I think you do not understand conservatism then because this is precisely one of it’s tenets.

  9. At the Senate it will be interesting to see how Rolland Burris votes, of if his situation influences the debate. A number of Illinois politicians have called for his appointment to be retroactively limited in order to have a special election to complete the rest of Obama’s term. The “Illinois Attorney General and other Constitutional scholars”:http://blogs.chicagotribune.com/news_columnists_ezorn/2009/02/could-we-really-vote-temp-sen-roland-burris-out-of-office-early.html have pointed out that a public official has no property interest in retaining his or her seat, so it doesn’t impact ex post facto or bill of attainder restrictions. (Also because he was not elected, but appointed, his seat falls in some other Constitutional gaps)

    I believe Burris’ senate seat is less protected than the AIG’s bonuses. Does Burris understand this? Do the Democrats that want to protect the seat understand this?

  10. We have only ourselves to blame for returning the same chumps to office year after year, and allowing them to gerrymander themselves into virtually unassailable positions. There is exactly one thing that has been done with full bipartisan cooperation in the last few decades, and that is incumbent protection.

    I have this dream of a non-partisan anti-incumbent movement. There would be exactly one platform- agree to vote against the incumbent of every office on the ballot regardless of party. I think something like that could have legs right now.

  11. I’m sure somebody protested W’s retroactive tax cuts on Constitutional (as opposed to economic) grounds, but no names come to mind.

  12. David Blue:

    The rot starts at political abdication. Bush signing a law that he though was unconstitutional is an example. I was listening to one Congresswoman this morning say that the super tax on bonuses might be unconstitutional, but that’s what the people want and it’s for the courts to decide whether what the people want is lawful. This is a complete reversal from the first 100, maybe even 150, years of this country where Congress and the President took the primary roles in vetting Constitutionality.

  13. Interestingly, Professor Tribe is backtracking from his previous support for the Constitutionality of the Super-Tax. “Link”:http://theplumline.whorunsgov.com/economy/law-professor-who-advised-obama-says-house-aig-bill-may-be-unconstitutional/ Though I add that his change stems from facts on the ground that existed when he gave his initial opinions — that Congress is “responding to pitch fork sentiment, it’s hard to argue that this isn’t an attempt to punish an identifiable set of individuals who are the subject of understandable outrage.”

    Maybe news of the pitchforks travels slowly to the ivory towers of academia.

  14. Professor Tribe is backtracking from his previous support for the Constitutionality of the Super-Tax.

    Interesting. Tribe has been the biggest Supreme Court wannabe in the country for decades – the liberal media has tongue-bathed him so often he must smell like orange Tic-Tacs – and that Ruth Ginsberg seat might be opening up soon. Looks like negotiations are already underway.

  15. I don’t see Tribe getting that call he’s been waiting for. He blew it with (1) an extremely weak performance at oral argument in Bush v Gore, where he seemed to think he was schmoozing with Scalia in a faculty lounge and (2) badmouthing Gore anonymously when David Boies was sent in to pinch-hit for him.

  16. I think Tribe’s scholarship on the 2nd amendment sinks any possibility of a SCOTUS seat. Short of rethinking Roe, you can’t be much more of a heretic in liberal circles. Tribe may be the individual most responsible for making the individual rights view respectable again, which was undoubtedly critical to Kennedy’s vote considering how much he likes to be liked by the Georgetown cocktail circuit.

    Heller may be settled law (whatever that means these days) but there is an even bigger ruling over incorporation on the horizon. If an Obama pick were to add a vote toward incorporation there might be a Brady Campaign riot.

  17. bq. According to Jack Balkin (link) the planned confiscations are constitutional.

    I’ll see your law professor, and point to “Professor Hutchinson’s dissent”:
    http://dissentingjustice.blogspot.com/2009/03/professor-balkin-defends.html

    Key graph:

    bq. Balkin’s argument that the tax does not target AIG recipients and that it applies to an “abstractly defined group” requires us to suspend reality. Even though the House measure is written in general terms, the motivation behind the measure is very clear: The House seeks to “punish” AIG and its executives by recouping almost 100% of the bonus payments. Balkin’s argument would legitimize the type of formalistic arguments that litigants often make when they want to avoid the impact of and impulse for their actions.

    A formalist is one that says that when the military places an enemy combatant in a prison, its not punishment, but detention. The stated categories, not surrounding evidence, are determinative. I gather that must be Professor Balkin’s position as well.

  18. Tigerhawk on The Rule Of Law (link), specifically “mounting evidence of something everybody knew, that the AIG employees who returned their retention payments did so under an implicit, if not explicit, threat from the government.”

    The flower and the chivalry of the Democratic Party whipped up popular anger for nothing more than political advantage, and their political allies stalked some of those executives at their homes. Then the attorney general of New York, who is supposed to protect the rule of law, threatened to make the names of these people public and expose them to the angry mob unless a high enough percentage of them “participated” in returning the money to AIG. Cuomo, of course, denied that he had blackmailed anybody, but he damns himself with this admission…

    Rule by fear, in contempt of contracts and the national constitution, and seizing money with menaces, with the New York Attorney General doing the menacing, in violent contradiction to what James Madison rightly said about “the first principles of the social compact, and to every principle of sound legislation”, corresponds to a primitive, barbaric mode of government.

    When you begin doing things like this, politicizing and rendering less predictable the simple connection between work for pay and payment according to contract, you create an environment that will breed more financial misfortunes, calling for more scapegoats in future.

    And yet, if the government finds it politically useful to ratify the legislation seizing the earned bonuses, the government will be able to find legal experts willing to say “yes this is constitutional”.

  19. Just to show it’s not only the left getting crazy over this, Richard A. Epstein starts to wish for a Supreme Court more ready to impose its authority on the other branches of government (link), and Matthew J. Franck points to some of the reasons why that’s a terrible idea (link).

  20. PD Shaw:

    I’ve generally supported a number of the bailouts, even thought the money to keep Detroit afloat seemed acceptable just to give us a little time to see if there were any other options (looks like no).

    I’m guessing that you hoped that politicians would intervene at times and in ways that you thought were appropriate, but they would not intervene at times and in ways you thought were wildly inappropriate. Is that a fair guess?

    It seems to me recent events have shown that:
    * Politicians can be bought for hundreds of thousands of dollars, or more usually just for tens of thousands of dollars.
    * When their patrons need it most, and when (likely due to the unintended consequences of their own interventions) there is panic, and spending public money not their own, these same politicians will disburse millions of dollars or billions of dollars, without showing much indication that they distinguish one from the other. (A hundred and sixty-five million paid out, a hundred and seventy-odd billion paid out, what’s in a letter?)
    * In weighing the emphasis that ought to be given to different aspects of economic emergency policy – like giveaways and letting the treasury just create more money – these same politicians don’t show adequate awareness of the difference between billions and trillions.

    It’s all monopoly money to them. The money that’s real to them is the money that goes in their bank accounts, to help secure their re-election, or to be spent for their own good.

    Is this not so?

    If it is so, and I guessed right above about what you hoped for, then weren’t your hopes bound to be disappointed?

    PD Shaw:

    I may have rejected the final product (like the stimulus package), but I can’t pretend that I’ve taken anything close to a non-legislative interference position.

    Have you seen anything lately that suggests to you that in future you might want to call it differently?

  21. I’m just pointing out that our government has just stomped merrily across several of the limits that triggered the original Revolution, seemingly without a second thought. That does raise some legitimacy issues, it would seem…

  22. But Tim, they haven’t – yet. The House has acted – stupidly – but we have a whole process, legislative, executive, and judicial before the ‘government’ acts.

    So let’s put a stick in the spokes someplace soon, and I think you’d agree that’s a better place to put one’s energy than building an armory at Concord.

    Marc

  23. Armed Liberal:

    But Tim, they haven’t – yet. The House has acted – stupidly – but we have a whole process, legislative, executive, and judicial before the ‘government’ acts.

    Right.

    But the present situation is already inconsistent with the members of the House having taken seriously a duty to uphold the constitution of the United States of America. And that’s worth noting.

    James Madison explained with sublime clarity how and why what is happening is against basic principles.

    Given that protection against exactly the moves we see was written into the constitution, how has it come to this? I have two suggestions, both likely to be disputed.

    (1) The rot spreads from the head, and when it comes to defending the constitution the Supreme Court is the head. The Supreme Court has, and the judiciary in general have, over-ridden both the other branches of government and the people so frequently, arbitrarily, radically and counter-intuitively that it has driven out of the other branches of government and the people the sentiment and habits of ownership of the duty to defend the constitution. Today, the constitution is nothing but what the Supreme Court says it is, and the nation’s executive and legislative office-holders have given up. They’re like little children who’ve been bullied by a hyper-bossy teacher who corrects not only every mistake but every word or sentiment that doesn’t suit the teacher’s mood that day. The children write and sign whatever they please, and then teacher corrects it into being whatever teacher pleases. So they’ve become irresponsible.

    George W. Bush, who (rightly in my view) said that McCain-Feingold was unconstitutional but did nothing to stop it, can stand as an image of that irresponsibility. It’s often remarked that he disregarded his oath of office, and I’ll get to that. But he also showed a lack of the necessary sense of ownership, as though, in Barack Obama’s rightly infamous phrase, making the call and acting on it was above his pay grade. He acted like, in relation to whatever the Supreme Court might be disposed to allow, he was no more than a pundit.

    If I’m right, and this is really a problem, the solution has to begin with appointing more people who think like Antonin Scalia to the Supreme Court. Of course, Barack Obama intends to do the opposite, so that’s going to get worse, not better, and we might as well not worry about it.

    (2) The moral force has gone out of our oaths. They are meant to be important. They’re supposed to do something. It’s obvious that when our political institutions were founded people did expect oaths to do something. But, with rare exceptions such as military oaths that are still taken seriously, they don’t bind people any more.

    I think that comes from the fact that the most common and important public vows that everybody used to have to take seriously were marriage vows. Powerful elites changed the laws, traditional marriage was demolished, and I think as an unintended consequence any sense of horror in violating sacred promises went away.

    If you corrupt the moral and dutiful sentiments of the people as a whole, that’s really, really serious.

    Again, this is not something that’s going to be fixed. Quite the reverse. So we might as well stop worrying about it.

  24. The Constitution does not concern itself so much with retroactivity alone, but with injuries and harms retroactively imposed.

  25. PD Shaw:

    I was listening to one Congresswoman this morning say that the super tax on bonuses might be unconstitutional, but that’s what the people want and it’s for the courts to decide whether what the people want is lawful.

    That’s it, in a nutshell.

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