The Constitution's Last Gasps

We must save our financial system has been the plea in Washington D.C. for the last week. Politicians and government officials feel "something" must be done or the country faces a meltdown of its financial system. That "something" is massive financial bailouts of banks and financial institutions in distress. The action is necessary, they claim, because the consequences of inaction are far worse. Yet, what are the consequences of inaction, and what of the legality of this action?

The Constitution clearly states that only Congress has the power to spend tax money. It is also pretty clear that this statute has been ignored since the inception of the Federal Reserve (1913). The summer of 2008 has been one of ever more unprecedented and unconstitutional action by the Federal Reserve, culminating in multi-billion dollar direct financial bailouts of America's largest financial institutions. Once the inflation, interest payments, bad debt write-offs, the Fed's low-interest auctions, and the government's ill-advised stimulus package are factored into the scheme, the American tax-payers stand to lose several trillion dollars and, more importantly, have already lost their system of government.

The backbone of the American form of government is its system of checks and balances. That system is broken. Congress played no role in the bailouts of AIG or Bear Sterns, yet several billion in tax-payer money have been used. The Federal Reserve's power to spend is unchecked and therefore its effect on Amerca's existence is unlimited. America's elected officials, all under oath to uphold and defend the Constitution, have placed the importance of a centrally planned financial system over that of its system of government.

In both the short and long-terms Americans will be hurt more by inadequate, and indeed criminal, governance than by the predicted "meltdown" of its government's financial system. The tyranny waged by American politicians has never been greater than it is today. This financial "crisis" is primarily due to the central planning of Federal Reserve and has been exacerbated by government legislation that unreasonably favored homeownership for all Americans: it is the government and the Federal Reserve who set the stage for this debacle.

It is painfully obvious that America's elected officials are more concerned with the facade of action in an election year than their sworn duty. It is obvious that the free-market is free only when it behaves in a manner conducive to their re-election. It is obvious that the Constitution is no longer a restraint of power but a historical document to be mentioned only when discussing days of yore. It is obvious that America's days as a freedom-loving, law-abiding bastion of opportunity for all have come to an end.