Robert Wenzel interviews Daniel McAdams

The Sequester ‘Crisis’ and What Should Be Done

By Ron Paul

Despite what the media and politicians would have us believe, the United States did not collapse last Friday when the package of spending reductions known as “sequestration” went into effect. The financial markets hardly blinked, as they have come to be more skeptical about these periodic government-hyped “crises.”

What had been portrayed as a drastic reduction in government spending was merely a decrease in the projected rate of increase in government spending over the next decade. Under sequestration, government spending increases by $2.4 trillion over the next 10 years rather than $2.5 trillion without it.

So we are speeding toward collapse at only 100 miles per hour instead of 110 miles per hour.

Some in Congress are using the panic over sequestration to justify another surrender of legislative authority to the executive branch. These members want to “pass the buck” on prioritizing federal programs by giving the president, cabinet officials, and high-level bureaucrats authority to set spending priorities. However, it is Congress’s job to set priorities in federal spending.

he drafters of the Constitution give the legislature the authority over spending because they recognized it was a threat to liberty to allow this power to be concentrated in the executive branch. Congress’s willingness to cede more authority to the executive should be opposed by everyone who values liberty and limited government.

Some of the loudest objections to sequestration have come from the champions of the military-industrial complex. Yet under sequestration defense spending will still increase by 18 percent over 10 years as opposed to 20 percent without sequestration.


There are claims that the military will face a one-time real reduction back to 2007 levels of spending, before beginning to climb again next year. That remains to be seen. However, few claimed at the time that 2007 levels of military spending, occurring as they did during the huge post 9/11 build-up, were inadequate.

But despite the fact that the US spends more on military than the rest of the world combined, we are told that even this modest, short-term reduction would be, in the words of outgoing Defense Secretary Leon Panetta, “shameful” and “irresponsible.” A return to 1980’s levels of military spending in real dollars – a time of significant military build-up – is considered outrageous even though the US faces no Soviet Union or equivalent threat.

In fact, the entire $1.2 trillion dollars that the sequester is supposed to save could be realized by cutting one unneeded, wasteful boondoggle: the $1.5 trillion F-35 fighter program. The F-35, billed as the next generation all-purpose military fighter and bomber, has been an unmitigated disaster. Its performances in recent tests have been so bad that the Pentagon has been forced to dumb-down the criteria. It is overweight, overpriced, and unwieldy. It is also an anachronism: we no longer face the real prospect of air-to-air combat in this era of 4th generation warfare. The World War II mid-air dogfight era is long over.


As defense analyst Winslow Wheeler wrote last year:

“It's time for Defense Secretary Leon Panetta, the U.S. military services, and Congress to face the facts: The F-35 is an unaffordable mediocrity, and the program will not be fixed by any combination of hardware tweaks or cost-control projects. There is only one thing to do with the F-35: Junk it.”


We should not look for cancellation of the F-35 program any time soon, however. The military industrial complex understands the political necessity of spreading its military Keynesianism as widely across Congressional districts as possible.

That is why F-35 manufacturer Lockheed-Martin can boast on its website that “the F-35 provides 127,000 direct and indirect jobs in 47 states and Puerto Rico.” What is unfortunately not understood is that these 127,000 workers would be far better utilized producing needed goods and services rather than treated as a jobs program disguised as national defense.

Despite the alarm over cuts that are not real cuts, it is clear that the US government is not serious at all about changing its ways. In a recent tour of the Middle East, newly-confirmed Secretary of State John Kerry announced that the US would be sending another $60 million to the rebels seeking to overthrow the Syrian government – in the midst of the sequester “crisis”!

Despite the rhetoric, there appears no intention on the part of the government to take our fiscal crisis seriously or abandon the idea that we should run the rest of the world.

The Imperial Presidency and the Coming Dictatorship

When the Founding Fathers had met in Philadelphia in 1787, one issue they had to address was the issue of executive powers. While Alexander Hamilton was openly in favor of a permanent American executive (an American King of sorts), a majority of the Founders feared and opposed expansive and iron-fist executive powers. They crafted the Constitution that created a limited executive whose role was to enact those laws that are in pursuance of the Constitution. The Presidency was not to make laws out of thin air (as with most executive orders) or to issue edicts by which the entire country would be dictated by. The Presidency was to have very few functions, and even then, most of those functions can be carried out only with the advice and consent of the Senate. But even the Founders recognized that executive power over time will expand and grow to the point where they could become imperious.

There should be no doubt in the minds of most Americans that the modern Presidency has concentrated too much power into it's hands. The powers that most Presidents have exercised in the last century to the present day is unconstitutional. We indeed are living under an Imperial Presidency. But despite the near dictatorial powers that the Presidency wields, many Americans continue to revere the institution and the vast and expansive powers the Presidency exercises over our liberty and natural rights.

The current administration of President Barack Obama is yet another example of continual disregard for the Constitution and the limits it places on the power of the Presidency specifically and the Federal Government generally. This is not to say that his predecessors were not bad Presidents or did not act imperially. Indeed, George Bush, Bill Clinton, Ronald Reagan, Franklin Roosevelt and many other Presidents have acted imperially. But by which standard do we measure whether or not a President is acting imperial? As Lew Rockwell has examined, there are three ways in which a President can be imperial: international belligerence, domestic belligerence, and running roughshod over another branch of government. In many cases, imperial Presidents have been involved in all three activities. All three of these activities violate the constitutional liberties and natural rights of every individual American, and in some ways, the natural rights of non-Americans.

President Obama has been interventionist in both domestic and foreign affairs. Despite the rhetoric of “bringing our troops home”, the American empire of military bases and political dominance still exists with 800-1000 military bases in over 135 countries, the war in Afghanistan continues, Iraq will continue to hosts thousands of private contractors hired from the U.S. government, the President has been threating war in Syria and Iran while getting the U.S. into unconstitutional wars in Yemen, Libya and Mali. Despite the doom and gloom picture painted by warmongering neoconservatives and humanitarian progressives, President Obama is not ending the wars or the empire. Domestically, the President is not shy about promoting Keynesian policies of increasing government spending, artificially lowering interest rates, raising taxes, expanding the money supply and generally gaining more and more control over the private economy. But as the last 4 years have demonstrated, Keynesian and socialist/fascist economics do not work and have failed to alleviate the majority of Americans from the economic slump that came about from the Great Recession. 

 While domestically, the problems of higher taxes, increasing government spending and crippling national debt all prey on the liberties and natural rights of Americans, the policy of empire overseas and targeted assassination of American citizens is just as equally harmful to our freedom.

For some time, there was speculation about the Obama administration’s policy of targeted assassinations and whether or not the administration can legally assassinate American citizens. After such speculation and stonewalling federal judges and ordinary citizens, the Obama administration has recently sent the Justice Department’s legal memos to NBC that claim the legal justification for a policy of targeted assassination of persons overseas, including American citizens. Judge Andrew Napolitano recently commented on the Justice Department’s memos, saying that the logic of the document “is flawed, its premises are bereft of any appreciation for the values of the Declaration of Independence and the supremacy of the Constitution, and its rationale could be used to justify any breaking of any law by any ‘informed, high-level official of the U.S. government.’” He continues:

The quoted phrase is extracted from the memo, which claims that the law reposes into the hands of any unnamed “high-level official,” not necessarily the president, the lawful power to decide when to suspend constitutional protections guaranteed to all persons and kill them without any due process whatsoever. This is the power claimed by kings and tyrants. It is the power most repugnant to American values. It is the power we have arguably fought countless wars to prevent from arriving here. Now, under Obama, it is here.

The whole question of targeted assassinations of persons including American citizens became more exposed when President Obama dispatched drones from the CIA to kill Anwar al-Awlaki, an American citizen born in New Mexico with affiliations to Al-Qaeda. After assassinating him while he was riding a car in a desert in Yemen, Obama administration dispatched a follow-up drone strike that killed Awlaki’s 16-year-old son and his American friend. Awlaki’s father sued the Obama administration in court to prevent the killings in advance, but to no avail.

The administration has attempted to justify this policy of targeted assassination by claiming that even if someone wishes to trigger the use of force thousands of miles away from our shores-thus making it “difficult” to arrest such a person-the government through the President has the right to kill such individual with impunity. No mention or consideration is even put towards the fact that assassinations and non-judicial killings are illegal and unconstitutional under U.S. law. There was no declaration of war against Yemen (the location of the assassination and Awlaki), and there is no article in the Constitution that gives the President or the Federal government the power to assassinate people in non-judicial killings.

It is difficult to argue that a guy in a car in a desert far, far away from our shores can be a serious threat to our security to warrant sending drones to kill him on the spot. Even an argument for declaring war on the country harboring him is more difficult to make (does Afghanistan ring a bell?) due to the costs in terms of lives, fiscal responsibility and liberty necessary to find one man. It would have been better to have arrest the man and put him on a trial by jury. Extradition would have been necessary. The Attorney General has argued that the President’ careful consideration of each target is a fine constitutional substitute of due process. This flies in the face of everything the founding of the United States stood against and the Constitution.

Many liberals who feel that the policy of targeted assassinations may be too harsh suggest that the remedy can be found in a court modeled after the FISA Court. The FISA court was established by the Foreign Intelligence Surveillance Act which was passed by Congress after the 1978 Church Committee exposed the massive abuses by the FBI who spied on and harassed Americans in the United State. The FISA court is not a real court; rather it is an executive panel with secret proceedings, housed right in the Justice Department, with the power to issue special warrants for spying on international communications with the enemy.

Faith in a FISA model court as a response to the policy of assassination is misplaced. As Anthony Gregory put is simply:

Between 1978 and September 11, 2001, there were about 13,000 FISA applications. Guess how many were rejected? Zero. That’s right, zero. This included a warrant issued to spy on a man in Phoenix accused of organizing a crime ring to steal and sell baby food.

Simply put, such a model will be nothing more than a rubber stamp for the President to kill anyone he wishes.

Make no mistake; such power grabs will not be used for the benefit of the American people or our liberties. Typically when an executive (whether that be a king, dictator or president, etc.) gains new powers, they typically exercise such power in the worse ways possible. This also applies to government generally.

Of course, it should come as no surprise that Obama is attempting to exercise such dictatorial power. He has made implications that he would use executive action to get around Congress in order to get anti-gun measures and budget measures passed. Congress has of course acquiesced to the power grabs by Presidents. As Chris Rossini has observed, the mainstream media seems to be preparing the American people for dictatorship. Let us hope that Americans will stand up to the federal government and resist iron-fisted executive power and undo the Imperial Presidency that has been foisted upon our country for some decades now. 

Examples of Centralization and Imperialism Against State Sovereignty

In response to a question about examples of states being held against their will in unions posted in Liberty Classroom's forums, historian Brion McClanahan provided the following response:

There are countless historical examples of “sovereign political bodies forced to remain in a union.”  Too often Americans think that the only instances of forced centralization are found in the nineteenth-century United States and in twentieth-century Europe, but the general trend of history has been one of centralization and tyranny under a strict definition, meaning the arrogation of power to an individual or central entity.  This could be classified as imperialism, be it economic, political, or cultural.  Individual liberty and decentralization have been fleeting concepts in human history and are typically made possible only through dedicated efforts on the part of vigilant defenders, often at great cost.  Centralization and its evil step-child nationalism tend to conserve the imperial culture at the expense of tradition.  This is why the founding generation, a group of men well versed in the classics, understood that their political experiment—a decentralized federal republic—would quickly descend into monarchy unless Americans firmly embraced both republicanism and a dedication to the preservation of life, liberty, and property, and why no American should champion imperialism at home or abroad.  Simply put, imperialism and centralization are un-American.

As for examples, in the ancient world sovereignty—legitimate political power—was found in the city-state.  As kings and warlords gained strength, they tended to force the expansion of their culture to wary neighbors.  Early examples include the unification of the Egyptian empire under the first Pharaoh, Narmar, and later the consolidation of the Persian Empire under Cyrus the Great.  Persia often forced wavering Greek city-states in Ionia into submission.  On the other hand, the Greeks were no strangers to imposing their will on reluctant allies.  Athens formed the Delian League following the Persian Wars in the fifth century B.C. and required tribute.  When Thasos attempted to declare its independence, Athens burned it and slaughtered its inhabitants.  Alexander the Great marched into Thebes and crushed an independence movement in the fourth century B.C.  In each case, these sovereign Greek city-states were forced into an illegitimate “union” they did not want.

China was also forged by blood.  The Qin Dynasty (ca. 221 B.C.) required the standardization of language and currency, but was eventually wrecked by rebellion, i.e. resistance to centralization.  And the first Chinese Emperor, Chin, forced independent states to adopt “national” laws.  Individuals that resisted were beheaded.  The result was several hundred years of almost constant warfare to subdue unwilling participants to the Chinese empire.

In the Americas, both the Inca Empire and the Aztec Empire were built on conquest.  The Moche and the Nazca in Peru were forced into the Inca Empire, and when the last Incan King, Atahualpa, was captured by Francisco Pizarro, he attempted to purchase his freedom by looting all the wealth of subservient tribes, to no avail.

The Romans were masters of the world by the first century B.C. precisely because they could project power around the Mediterranean.  Some submitted due to the promise of the “Pax Romana,” the majesty of Roman peace, but not all went down quietly.  The Greeks continually rebelled against Roman power and the Punic Wars were in part a response to Roman imperialism. The Celts were forced to kiss the feat of Caesar after his successful Gallic campaign, and had the Germanic tribes not been the formidable, warlike people that they are, the Romans would have pressed farther into central Europe.

In more recent history, Scotland was forced into an alliance with England by the 18^th century after several attempts at Scottish independence failed.  There were around 300 virtually autonomous German states as late as the 18th century, yet all were consolidated by Otto von Bismarck in the 19th century through “blood and iron.”  The separate states ofItaly were coerced into a centralized state by Giuseppe Mazzini and Giuseppe Garibaldi in the 19th century.  Both Argentina and Brazil had wars of centralization in the 19th century against “rogue” provinces, most important the State of Buenos Aires in Argentina.  In fact, the 19th century has been called the era of nationalism precisely because consolidation was a central theme of the period.  In each instance, sovereign, legitimate governments—tribal, local, or more complex—were overwhelmed by the forces of centralization and tyranny. Understanding this trend is the key to resisting the powers of centralization in the 21st century.  Liberty and republicanism are the lasting jewels bequeathed to us by our ancestors, but they can be maintained only by an educated, moral citizenry, for as Thomas Jefferson wrote, “If a nation expects to be ignorant and free in a state of civilization, it expects what never was and what never will be.”  But don’t just take my word for it.  Much of this material is discussed in Dr. Jason Jewel’s excellent Western Civilization courses at Liberty Classroom.  I trust him, too.

What Real Austerity Is

By Mark Thornton

Austerity has been hotly debated as either an elixir or a poison for tough economic times. But what is austerity? Real austerity means that the government and its employees have less money at their disposal. For the economists at the International Monetary Fund, “austerity” may mean spending cuts, but it also means increasing taxes on the beleaguered public in order to, at all costs, repay the government’s corrupt 

creditors. Keynesian economists reject all forms of austerity. They promote the “borrow and spend” approach that is supposedly scientific and is gentle on the people: paycheck insurance for the unemployed, bailouts for failing businesses, and stimulus packages for everyone else.


Austrian School economists reject both the Keynesian stimulus approach and the IMF-style high-tax, pro-bankster “Austerian” approach. Although “Austrians” are often lumped in with “Austerians,” Austrian School economists support real austerity. This involves cutting government budgets, salaries, employee benefits, retirement benefits, and taxes. It also involves selling government assets and even repudiating government debt.


Despite all the hoopla in countries like Greece, there is no real austerity except in the countries of eastern Europe. For example, Latvia is Europe’s most austere country and also has its fastest growing economy. Estonia implemented an austerity policy that depended largely on cuts in government salaries. There simply is no austerity in most of western Europe or the U.S. As Professor Philipp Bagus explains, “the problem of Europe (and the United States) is not too much but too little austerity—or its complete absence.”


Most of Europe and the U.S. continue to have massive budget deficits and growing national debts relative
to GDP. The Keynesians’ magical multipliers have once again failed to materialize. Given that most of these
economies have not achieved growth from stimulus, they should give the idea of true austerity a fresh look.


Austerity for individuals, means living a highly restricted lifestyle. The best example is the monk who
lives on a subsistence diet, wears simple clothing, possesses a few basic pieces of furniture, and uses only necessary utensils. His days consist of long hours of work and prayer with no leisure activities and he may not even enjoy indoor heating and plumbing.


Austerity applied to whole countries, is not necessarily so harsh or ascetic. It simply means that the government has to live within its means.

Read the rest of the article from the Mises Institute's monthy publication call The Free Market

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