Like Bees to Honey: Inviting All Lawmakers to Save Our Republic

Reflections from the Editor and a Club for Growth Foundation Fellow

BY MICHAEL THOMAS HAMILTON, Good Comma Editing

Afterword

One pillar that upheld Rome as a republic for hundreds of years was the relative restraint of her tax system for her many provinces that sprawled east and west of the “eternal city.” This restraint had at least two effects noteworthy for Americans in our time. First, it enabled provincial inhabitants to continue conducting affairs and prospering largely as they had prior to their local rulers’ submission to Rome. Second and equally important, the amount of money available to spend on ill-conceived public policy decisions and crony business dealings was capped. For a time, Rome’s finite reserves did what no other government or army on earth could: check Rome’s power.

Then, one day in 123 BC—about 100 years before the republic collapsed at the feet of Rome’s first emperor—Rome changed her tax policy. The impetus was an unexpected revenue windfall instantly addictive to Rome’s leaders: the king of a subdued province in present-day Turkey had died—but, rather than leaving his state’s vast treasury to his heirs, he had bequeathed it to Rome, as if conceding her authority to be inescapable and final.

For 10 years, the Senate debated whether to redistribute the gold to Roman citizens, fund agricultural land reform, subsidize grain markets, invest militarily—or leave the surplus to the pitiless provincials whose king had overtaxed them. Eventually, traditional Roman suspicion of gold as a gateway drug to moral corruption yielded to the bullish optimism that free money always fuels in the name of the “common good.” Naturally, the most bullish were those positioned to influence the flow of such money. At last, dreaming bigger than one king’s treasury, Rome began mercilessly taxing her eastern satellite states, while accelerating the ravaging of her western lands through silver mining. As popular historian Tom Holland put it, “The lid of the honeypot was now well and truly off.”¹

America’s Honeypot

In the United States, the lid of the honeypot has been off for about 100 years as well, and today the consequences of our fiscal and monetary policy are laid bare. During the Roaring Twenties of a century ago, speculation made with loose, cheap credit abounded. As investment fueled by artificial wealth boomed, unemployment dropped toward historic lows. The catastrophic bust mired the US in the Great Depression and sunk the global economy with it. As if spending could cure overlending, FDR implemented an unprecedented series of taxpayer-funded public works programs. But the “honey” of “the New Deal did not end the Depression. Unemployment was as high before World War II as it was in 1932, and incomes and productivity had actually declined.”²

Nevertheless, Keynesian advocacy of greater spending—and the expansion of government’s sphere of action, and then control— continued to prevail through the war. Contrary to claims at the time that interventionist policies (price and wage controls and rationing) and buying war bonds would supply Allied victory, “almost all the funding for the war came from taxes and the Fed’s inflating of the currency,” teeing up a 17% annualized inflation rate immediately after the war.³ Even today, decades after orthodox Keynesianism fell out of favor with economists across the political spectrum, it is Keynesian terminology that politicians, officials, and economists use to describe the government’s taxation, spending, and manipulation of supply and demand for goods, labor, and money. Words give form to ideas, defining and directing the trains of thought of those who use them. Fulfilling this Orwellian prophecy, Nixon famously echoed non-Keynesian Milton Friedman’s lament, “We’re all Keynesians now.”⁴

Since the late 1940s and 50s, the honey has ceaselessly flowed from the US Treasury and the Federal Reserve to programs and industries deemed by those in power to be of national interest. Spilling far beyond the military-industrial complex that Eisenhower foresaw, taxpayer funding next fueled Lyndon Johnson’s Great Society welfare programs. These would evolve into an albatross around the neck of every federal and state legislator, every president and governor. Predictably, “Social Security, Medicare, Medicaid, and kindred welfare state programs moved to the center of our political life, dominating the domestic agenda and eventually usurping the majority of federal spending, now delicately termed ‘uncontrollable.’”⁵ Despite early gains against racial injustice in the 60s and provision of longer-term relief for aging Americans, half a century later, many such programs have proven a snare to poorer citizens’ individual prosperity and achievement, rather than a safety net.

Contrary to the restless swarm buzzing around America’s bottomless honeypot, cooler heads emerged from the shade in the 1970s after decades of “stand[ing] athwart history, yelling ‘Stop,’ at a time when no one [was] inclined to do so.”⁶ But the free-market recommendations first championed by Austrian economists Ludwig von Misis and Frederick Hayek would continue to swim upstream. Tying the value of the US Dollar to nothing more than America’s fiat, or assertion, that it has value, Nixon essentially guaranteed his successors’ perennial escalation of government manipulation of consumer behavior through profligate fiscal and monetary policies.⁷

History may not truly repeat, but it does reincarnate. The burst of the dot-com bubble in the stock market in 2000 was prelude to a far worse correction. Once again fueled by extremely cheap credit—much of it extended to a critical mass of citizens unable to make their mortgage payments—the 2008 crash evaporated $7.4 trillion in stock wealth, equal to $66,200 per US household.⁸ The mantra that certain companies and industries were“too big to fail”(meaning to let fail) ushered in a new era of corporate welfare. In this era, richer people who make risky investments extract honey from poorer people who make safer investments or who cannot afford to invest at all. Again choosing to spend America’s way out of an overlending and overspending crisis, empowered officials dumped more “free” money into the economy through “quantitative easing”—for a decade. Concurrently, Barack Obama and Congress made taxpayers liable for the health insurance fees of millions of Americans (even of those who earn more than many of the taxpayers funding their insurance plans!). Subsequently, both red and blue presidents and Congresses—Trump and Biden—made multiple direct payments to the American people. Biden has further promised that workers who paid off their own college loans shall also pay off the loans of people who have not.

America’s immense spending and rapid government expansion over our relatively brief history uniquely position 21st-century Americans—but whether we teeter on the cutting edge of a new frontier or on the slippery slope of an abyss remains to be seen. As of this writing, the Fed’s balance sheet reads $8 trillion, having reduced it from $8.7 trillion in an effort to check and prevent the return of recent runaway inflation that the Fed itself caused.⁹ The current national deficit hovers at $1.9 trillion, while our overall national debt has ballooned to $34.7 trillion: a lidless honeypot.¹⁰ Today, thanks to the popularity of the Broadway musical Hamilton, it is again cool to invoke the blessing of the first treasury secretary of the United States on our national debt. But this abuses Alexander Hamilton, who wrote,

Frustrated that even bigger spenders than himself had distorted his statement that “a well-funded debt would be a national blessing that would protect American prosperity,” Hamilton was still clarifying five years later:

Progressive accumulation of debt is perhaps the natural disease of all governments…….It is not easy to conceive anything more likely than this: to lead to great and convulsive revolutions of empire.¹²

Alexander Hamilton would have regarded our lidless honeypot with weeping and gnashing of teeth—first because of how much we spend, but second because, due to today’s regulatory environment, our elected leaders spend in the wrong ways and on the wrong things to achieve their stated outcomes.

Fix or Fall

Yet judging by today’s polarized, volatile, highly combustible political and social culture, limitless government spending has not restored the American happiness or relative unity of earlier times. Whatever endorphins that spending sprees are supposed to release, Americans aren’t feeling them (at least not in the public square). Rumblings of another American civil war appear to be more common now than at any time since 1860, with half of one 8,600-respondent panel claiming they “expect a civil war in the US in the next few years.”¹³ As Election 2024 approaches, two presidents currently vie for victory; one faces waves of allegations, the other an undeniable pattern of senility. Both major parties share concerns that the true winner will not hold that office—if not due to election fraud, then due to a planned resignation, or even an invocation of the 25th Amendment, that passes power to the vice president. Now—seemingly closer than ever to “the end of days”—America’s march down a divided highway toward the selection and empowerment of our next Great Man feels eerily Roman.

The prospect of bridging that divide at our nation’s critical moment is precisely why the policies recommended throughout this Club for Growth Foundation handbook are promising for lawmakers and their constituents. Rather than conceiving stillborn legislative agendas to be pronounced dead on arrival in either chamber, the authors have produced (or have highlighted current lawmakers’ production of ) public policy solutions that ought to appeal to broad swaths of legislators across the political spectrum. Bombastic howls for the red meat of “mere” deregulation—as a cynic might expect from a cadre of free-market- minded scholars, experts, and purists tasked with such a project—receive no quarter in this book. With admirable ingenuity and restraint, the authors have descended from the lofty idealism of Mount Olympus to offer practical solutions to pragmatic lawmakers running political races. They invite lawmakers on all sides of the valley to share common (and usually commonsense) ground.

Instead of mere deregulation—a proposition big- government proponents might kill in the cradle— these policy recommendations consistently call for regulatory innovation that would make today’s regulatory environment more efficient and relevant. Such efficiency and relevance have (or should have) universal appeal to progressives, conservatives, and libertarians alike. Efficiency would enhance regulators’ decision-making abilities, not remove them. Relevance would enable regulators to redirect and refocus their attention on the most critical intersections of American interests in tax, manufacturing, energy, infrastructure, education, and legal policy. Efficiency and relevance would not defund the departments or agencies that oversee these areas that, for better or worse, are forever in the federal government’s purview. Instead, efficiency and relevance would allow regulators to redeploy funds and manpower to address areas that bipartisan coalitions have identified as inflection points for American prosperity.

A convenient byproduct of making regulation itself more efficient and relevant is its multiplication of efficiencies for everything lawmakers regulate. Grant Dever, author of this handbook’s “Liberating America: Overcoming Energy Scarcity and Inflation,” writes that H.R. 1, the proposed Lower Energy Costs Act (LECA), “would make it much easier for businesses to conduct maintenance of existing projects and to seek new opportunities on lands that have already been assessed, reducing unnecessary paperwork and bureaucracy.” LECA would achieve this not by letting businesses run unregulated but by merely reducing redundancy where regulators have already spoken. The same bill would limit officials’ review of permit application materials to one or two years, depending on the materials—hardly unreasonable, considering this is barely fast enough to keep pace with the technology that applicants are likely to use for the projects, if they ever receive permits for them.

Simplifying regulatory processes would enable actual regulation to occur, instead of the Chinese water torture of waiting endlessly for regulators to review, or consider reviewing, while opportunities expire. Simplification should entice both those who want more regulation and those who want less. For example, LECA would help businesses mine for critical minerals (and reduce US dependence on other countries) by designating a single agency as the point of contact when multiple agencies are involved, requiring concurrent (as opposed to consecutive) review of projects, and establishing clear timelines to reduce uncertainty. This proposes nothing that members of Congress with a shred of organizational leadership experience would not desire from and (one hopes) require of their own staff.

There is room for both sides, both parties, both agendas, to find satisfaction in the regulatory innovation recommended in the pages of this handbook. “Would you rather have cheap fuel or reduce carbon dioxide emissions?” is no longer an accurate question in all contexts. Innovation has lowered energy costs— the Shale Revolution’s increase of the supply of natural gas saves many households $2,500 annually—and has lowered carbon dioxide emissions precipitously, contrary to forecasting during the George W. Bush presidency.¹⁴ Similarly, the proposed Advanced Reactor Fee Reduction Act would waive the application fee for the first companies awarded licenses to operate various categories of advanced reactors. Considering that one company recently spent $500 million to prepare its application, this carrot would entice more companies to innovate, “rather than waiting for others to pave the way in the hope that the process becomes more efficient over time.”¹⁵ Naturally, attracting more applicants would also increase the flow of fees to the collecting agency and bolster regulatory activity—a win for all sides.

The handful of bipartisan energy solutions I have highlighted here are representative of the golden mean that every other policy paper in this book emphasizes by offering lawmakers of all stripes a roadmap to regulatory innovation in tax, manufacturing, infrastructure, education, and legal policy. In an era when the legislative branch’s chief ability seems to be that of ceding and bleeding away its power to the leviathan executive branch, these recommendations propose to break congressional gridlock with a bipartisan blitz up the middle way. Surely that is a more mouthwatering, and hopeful, prospect than the lidless honeypot of our past and present.

Endnotes

1 For a fuller retelling of what I have recounted, see Tom Holland, Rubicon: The Triumph and Tragedy of the Roman Republic (London: Abacus, 2004), 28–47.

2 Ron Paul, End the Fed, the Foundation for Rational Economics and Education, Inc. (Grand Central Publishing: New York, 2009), 69.

3 Ron Paul, End the Fed, 34–36.

4 Jeffrey Snider, “We’re All Keynesians Now Because We Have No Choice,” RealClearMarkets, July 8, 2016, https://www.realclearmarkets.com/articles/2016/07/08/were_all_keynesians_now_because_we_have_no_choice_102254.html.

5 Charles Kessler, “The New New Deal,” Imprimis vol. 39, is. 5/6, Hillsdale College, May 2010, https://imprimis.hillsdale.edu/the-new-new-deal/.

6 William F. Buckley, “Our Mission Statement,” National Review, November 19, 1955, https://www.nationalreview.com/1955/11/our-mission-statement-william-f-buckley-jr/.

7 Jeffrey Snider recounted for RealClearMarkets, “The quote attributed to Nixon was actually given by Milton Friedman—twice. The first was in a Time Magazine article from December 1965 all about Dr. Keynes. Friedman was purportedly very upset about his inclusion in the work, judging it to be a case of words taken far out of context. In 1968, he attempted to set the record straight, declaring instead that, ‘We all use the Keynesian language and apparatus; none of us any longer accepts the initial Keynesian conclusions.’ As Nixon would prove in just three years, all that matters is the former. See Jeffrey Snider, “We’re All Keynesians Now Because We Have No Choice.”

8 The Pew Charitable Trusts, “The Impact of the September 2008 Economic Collapse,” April 28, 2010, https://www.pewtrusts.org/en/research-and-analysis/reports/2010/04/28/the-impact-of-the-september-2008-economic-collapse.

9 Board of Governors of the Federal Reserve System, “Federal Reserve Balance Sheet Developments,” November 2023 (latest available), https://www.federalreserve.gov/publications/files/balance_sheet_developments_report_202311.pdf.

10 usdebtclock.org.

11 Quoted in Ron Chernow, Alexander Hamilton, ch VIII 20:10–21:28, narrated by Grover Gardner (New York: Penguin Audio, 2004), Audible audio ed., 11 hr., 51 min.

12 Quoted in Ron Chernow.

13 Rodrigo Pérez Ortega, “Half of Americans anticipate a U.S. civil war soon, survey finds,” Science, July 19, 2022, https://www.science.org/content/article/half-of-americans-anticipate-a-us-civil-war-soon-survey-finds.

14 Grant Dever, “Liberating America: Overcoming Energy Scarcity and Inflation,” in this handbook.

15 Grant Dever, “Liberating America: Overcoming Energy Scarcity and Inflation.”