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How can we secure our economic rights?

This all too well known quote “A Republic if you can keep it” from Benjamin Franklin expressed the trepidation that many of the founders felt regarding the new federal government they had created.  The checks and balances built into the Constitution might not prevent the abuse of power by elected officials.


The Constitution protects both economic and personal liberties.  The Fifth and Fourteenth Amendments protect the due process rights of citizens, including the right of citizens to work, start a business, own property, etc.; indeed, the founders viewed economic liberties as simply an extension of our personal liberties.  The Supreme Court was charged with protecting the economic and personal liberties embodied in the Constitution.


Over the years, the Court has done a better job of protecting personal liberties, such as religious freedom, freedom of the press, etc.  The Court has been less successful in protecting economic liberties.  Unsustainable growth in federal debt imposes tax burdens on current and future generations; inflation weakens the value of the currency and increases the cost of living; high and uncertain tariffs disrupt the decisions of businesses and consumers.


Milton Friedman concluded that what the nation needs is an economic constitution to constrain the power of the federal government.  The fundamental idea of an economic constitution is to replace discretionary government decision-making with constitutional rules.  With an economic constitution, elected officials could be held accountable for any abuse of power that violates our economic liberties.


Switzerland provides a model for an effective economic constitution constraining the power exercised by the federal government.  The Swiss debt brake constrains the growth in federal government spending to the rate of growth in the private economy.  Federal government deficits must be offset with surplus revenue to balance the budget in the near term.  Swiss monetary rules maintain the value of the Swiss franc.  Swiss free trade agreements with other countries eliminate tariffs on manufactured goods, and these rules have been honored in the long term.


Switzerland’s constitution created the strongest federalist system in the world, vesting strong powers in their cantonal and municipal governments.  The Swiss constitution provides for direct democracy through initiative and referendum at all levels of government.  Swiss citizens vote on government expenditures, taxes, debt and many other decisions impacting the economic as well as personal liberties of their citizens.


New constitutional rules protecting economic liberties have often been proposed in Congress without success.  For example, over the past century, many resolutions have been introduced in Congress calling for a balanced budget amendment to the Constitution, but none of these resolutions has received the two-thirds vote in Congress required to submit them to citizens for ratification.


U.S. citizens do not have the power of direct democracy at the federal level comparable to that enjoyed by Swiss citizens; the Constitution does not provide for initiative and referendum.  But Article V of the Constitution does give citizens as well as Congress the power to propose amendments. That power has never been used to enact an amendment, because Congress pre-empts the states by proposing their own amendments. But we can no longer rely on Congress to protect our economic liberties.


Citizens must break the deadlock that has prevented the states from proposing amendments.  In 1979, two thirds of the states had submitted resolutions calling for a fiscal responsibility amendment to the Constitution, but Congress failed to count the resolutions and call the convention.  Private organizations are now suing Congress for failing to fulfill their administrative duty under Article V to call the convention.  They are working with grassroots organizations and state elected officials to support this effort.  Using an Article V convention to enact a fiscal responsibility amendment would set a precedent for other amendments to constrain the power of the federal government and preserve our economic and personal liberties.


Barry W. Poulson is professor emeritus at the University of Colorado, Boulder Colorado, and on the Board of the Prosperity for US Foundation. William Owens is a former vice chairman of the Joint Chiefs of Staff. He is on the Board of the Prosperity for US Foundation.


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