"We cannot solve our problems with the same thinking we used when we created them."
~ Albert Einstein
Governments in America — at both the state and federal level — are in an escalating state of bankruptcy. Politicians, media hacks, and academicians propose the kinds of responses reminiscent of the classic definition of insanity: to keep repeating the same actions expecting a different result. Increase income taxes, cut spending, enact a federal sales tax, tax "junk food" and tanning salons, are just a few of the suggestions being made by those intent on recycling political solutions to politically-generated problems.
At the center of all this is a national debt that has arisen from a basic truth that statists prefer to ignore: human beings are much less thrifty in spending other people’s money than they are with their own. Let me control your checkbook, and I will come up with a much different pattern of expenditures than you would have. We are much more generous with the lives and property of others, a state of mind upon which political systems depend for their existence.
We need to step outside the circle of our conditioned thinking and consider alternatives to our dilemmas. I have a modest proposal to offer to resolve the national debt: repudiate it! The reality is that, even after more extended wars and the formalization of slave-state efforts to avoid it, defaulting on this debt will become the ultimate solution. Leviathan, and its institutional keepers, will not curb its appetites, particularly when all that stands in its way are the always-expendable people.
I find support for my proposal in the thinking of the Keynesians, whose ideas most of us accepted, helping to produce our current state of affairs. My undergraduate introduction to the study of economics was firmly rooted in Keynesianism, whose tenets expressed what I assumed Thomas Carlyle meant in regarding this field of study as the "dismal science." One of the frequently stated defenses of government debt was "we only owe it to ourselves." It was only years later that I was to discover who the "ourselves" were to whom we were indebted. Such creditors proved to be the same gang who comprised "we, the people" in the creation of government in our country: the institutional interests who comprise the ruling political establishment.
If the idea that we "only owe [the debt] to ourselves" was sufficient to help generate popular acceptance of Keynesian doctrines, should not the repudiation of this debt be seen as a reasonable solution? After all, if I "owe" myself $100, would it make sense for me to contrive all kinds of mechanisms and schedules for repaying it? It is comparable to the kind of nonsense thinking one sees in advertising: "you owe it to yourself to" purchase a retailer’s product or services. If I failed to make this purchase, would I have a cause of action against myself grounded in negligence or breach of contract? Could I go to court and get a judgment against myself for my misfeasance? The proposition is so absurd that it could only be taken seriously in a law school!
To suggest that the national debt be repudiated will strike politically-conditioned minds as irresponsible. "Responsibility" is a word which, when divorced from individual conduct and the concept of property, can become little more than a duty one has to satisfy obligations others have created for him or her. By contrast, I am responsible for the consequences of my actions, or from what my property has done to another, because — and only because — as a self-owning person I am in control of my energies and other resources. Political action, on the other hand, is the very essence of irresponsible behavior, for it allows those who desire a particular end to shift the costs of providing it to those who do not want it.
The myth of "representative government" is invoked, at this point, to inform us that politicians and other state officials are our "agents"; that we — you and I — are the "principals" in this arrangement who are responsible for what our "agents" do in our behalf. Thus, if we have directed our agents to run up enormous debts, we are obliged to satisfy such liabilities. I trust that such delusional thinking — grounded as it is on the "social contract" theory of the state — will not require much refutation here. But in case a reader has not thought this through, let me observe that — apart from a few isolated examples of voluntarily constituted communal societies — I am unaware of any political system that has arisen by way of a consensus [i.e., universal agreement] among those to be collectively bound. Governments — including the American varieties — have arisen through and been maintained by conquest; by violent force. The idea that one who has not sanctioned the state that insists upon controlling him can be considered a "principal" who is vicariously responsible for the acts of his phantom "agents," is nothing more than the imposition of duties upon those who have not undertaken them. Along with the myth of "democracy" — which I have defined as the illusion that my wife and I, combined, have twice the political influence of David Rockefeller — such ideas are part of the corruption of thought upon which state systems depend.
Even the politicians who have been voted into office cannot reasonably claim to be the agents of anyone. Voting takes place anonymously, in the privacy of a polling booth, with no public expression of one’s choices. Unlike the sales representative of the United Updike Company — who has been provided, by his employer, with an office, business cards, telephone, and other indicia of his status as an agent — politicians are unable to clearly identify anyone for whom he or she acts. Furthermore, those who do not vote — such as myself — could never be accused of selecting any politician as his or her elected agent. The man who claims to represent the congressional district in which I live almost always votes contrary to my personal values: in what twisted way could he be said to be my representative in Washington?
The following example might serve as an effective means of getting the state to formally acknowledge that it is not the agent of any ordinary people. One might identify a given candidate — perhaps for the House of Representatives — and send them a certified letter [for evidentiary purposes] telling that person as follows: "I intend to vote for you, in the general election, to be my duly selected representative in Congress. If you are elected, I hereby direct you to never vote for any measure that would, whether directly or indirectly, increase my tax obligations." Should that person be elected, a follow-up letter should at once be written stating: "Congratulations on your being elected as my representative to Congress. I voted for you in yesterday’s election. You will recall my letter of [previous date] in which I directed you, as my agent, to never vote for any bill that would increase my tax obligations." After taking his or her seat in Congress, should the representative vote in favor of any such tax-increasing measure, the alleged "principal" would immediately file an action against the so-called "agent" for breach of contract. The courts would then have to confront the issue of whether an elected official is or is not such an "agent" of those who so select them. I suspect the judiciary would hold that such officials are not the agents of anyone other than themselves.
The fallacy of the state as an agent further unravels in the face of the routine practice of government officials keeping their actions secret from their alleged principals. In what marketplace setting would an employer be legally prohibited from knowing the details of its employee’s course of employment conduct? The most recent example of this practice was seen in the House of Representatives voting down a measure that would have provided for an audit of the Federal Reserve policies and practices. By a 229-198 margin, Republican and Democrat agency pretenders decided that it was not the business of their alleged "principals" to be privy to the knowledge these elected officials share with one another.
In the face of an indebtedness generated by those who make a pretense of representing us — even though we might not have so chosen them; who keep secret the purposes and interests of the real beneficiaries of their actions; who stand by, without objection, as trillions of dollars are shoveled from the Treasury into the coffers of the corporate owners of the political system; with what principled and reasoned intelligence can it be said that we — you and I — are responsible for the ensuing disaster, and have an obligation to restore solvency to the system?
There is no better time than the present for Boobus Americanus to finally get around to do what he has long resisted doing: questioning the nature of the state. While the Constitution and those who officiate on behalf of the state speak to the promotion of the "general welfare" as the underlying purpose of the arrangement, the reality is that all political systems — in whatever time or region of the world — exist for the sole purpose of benefiting a few at the expense of the many. Our liberty, our wealth, even our very lives, are at the disposal of self-anointed masters who have conditioned us to believe in the legitimacy of their rule. As the system intensifies threats of its violence against us to keep us in a line that can lead only to our individual and collective bankruptcy, intelligent minds would do well to ask the whyness of our supposed obligations.
We might begin by identifying the real parties in interest in all of this. Such an inquiry would be yet another invocation of the "cui bono?" question: who has benefited from the destructive mess that has been created? How should moral and causal responsibility be allocated in defining who should bear the costs? If my neighbor loses his job and later goes bankrupt, should I be considered "responsible" for his losses, as well as obligated to his creditors?
This is but a revisitation of an earlier financial "crisis" that American taxpayers were called upon to resolve. In the early 1970s, New York City was unable to meet its obligations to bondholders who had underwritten various governmental projects — including the construction of the World Trade Center. The corporations and others whose special interests had been served by such endeavors, were not receiving their promised bond payments. The politicians and the mainstream media were quick to the rescue. You may recall the "financial crisis" that had hit New York City, represented as some vague "threat" to all residents of Gotham.
I recall the anguish of a fellow faculty member at a university where I was teaching at the time. He literally cried — real tears — at the prospects facing New York City, as he begged our support for a rescue from Congress. "My wife and I (sob!) spent our honeymoon in (sob!) New York, and the thought that Central Park (sob!) and the theaters (sob!) should disappear is (sob!) too painful to bear." "Where do you think all of this is going?", I asked. "Do you think Middle-Eastern bankers are going to attach a rope to Manhattan and pull it to Saudi Arabia?" He just gave me the same kind of empty stare we are likely to see on the face of Boobus, as he embraces his "responsibility" for seeing to it that the current gang of special interests receive their promised spoils.
The political establishment and its media toadies will condemn any sentiment that suggests that you and I approach the solution to the national debt crisis with the same self-interest motivation that led the institutional order to create it. We will once again be admonished to put aside our "selfishness" for the "greater good," an appeal that will bring us face-to-face with Stendhal’s observation that "the shepherd always tries to persuade the sheep that their interests and his own are the same."
Butler Shaffer [send him e-mail] teaches at the Southwestern University School of Law. He is the author of the newly-released In Restraint of Trade: The Business Campaign Against Competition, 1918—1938 and of Calculated Chaos: Institutional Threats to Peace and Human Survival. His latest book is Boundaries of Order.