Freedom for Those Who Deserve It
Posted by: Not The Only One in Government Incompetence, Voting, Government Corruption, Civil Rights, EconomicsMichigan set an unsettling precedent in American politics recently when Governor-appointed Emergency Finance Managers were allowed to overreach their powers over certain towns, cities and counties throughout the state. With Michigan running in debt for decades, EFMs were appointed about 20 years ago and only until recently have had a mostly advisory position within the cash-strapped local governments and school districts to which they are assigned. But now the state government has expanded what the EFM can do, overstepping the powers of locally elected officials, and in some cases, firing them.
To be fair, the EFM laws do have a list of requirements that would place a town or city under EMF control; inability to pay creditors or its own payroll are considered under these laws to be signs a local government may be unable to dig itself out of its deep debts. And when the state the immense fiscal insolvency of a local government, the state gives advance notice that their local EFM will be given broader authority if such fiscal irresponsibility continues. In Detroit, for example, Robert Bobb, the EFM for that school district, has voided union contracts, laid off ineffective teachers, closed failing schools and established charter schools. Naturally there has been a backlash against these new measures. The Michigan Citizen, a black newspaper, has dubbed EMFs the “new Jim Crow”, claiming it disproportionately targets cities and towns with large black populations. Jesse Jackson has said the Governor is “trampling democracy”. Even Stephen Colbert of the parody commentary show the Colbert Report lampooned the new EFM laws, dubbing it, “autocratic for the people”.
If Presidents George W. Bush and Barack Obama have taught us anything, it is that government bailouts do not work, whether they are to failing businesses or entire industries. Unlike Washington, Michigan cannot print its own money and cannot bailout itself, much less its local governments.
I’ve always felt that freedom was for people who deserved it, who made the right decisions most of the time, or at least enough to keep them from losing their freedom. People who use their freedom to make money with a job and make the right choice. People who use their freedom to make money by robbing people or stealing cars make the wrong choice end up losing their freedom and behind bars. Sure, freedom to make the wrong decisions, but as long as you are the only victim of your poor judgement, you shouldn’t have to worry about losing your freedom.
The people of Michigan were free to vote for whoever they wanted, and the elected their own town and city legislatures, and these people chose to spend more money than they took in, until they were neck-deep in debt. Michigan voters wanted bigger government: well,, they got it. In an effort to keep local governments functioning and prevent them from being so broke they cease to exist the state of Michigan has taken away the peoples’ rights to elect whoever they want, because whoever they wanted to elect have created this fiscal disaster. The people of Michigan voted into office people who advocated for a bigger, more expansive and expensive government, a reflection of the electorate’s true desires. Who cares if the governments didn’t have the money to pay for all these services, or in some cases cut taxes while increasing spending, giving themselves and their cronies fat salaries? Michigan cares, at least they do now. EMFs have been made the warning sign for local governments to stop pandering to special interests like big corporations, labor unions and the selfish financial interests of the people who run them before it is too late and their executive powers have been usurped by state officials.
But this sets an interesting precedent; that state governments would rather take the democracy away from its citizens rather than have its local governments drown in a sea of red ink and disappear. That the government would rather put its own self-preservation ahead of the freedoms it claims to uphold. Last year former California Governor Arnold Schwarzenegger requested a $6.9 billion bailout from the federal government. We know Washington no longer pays attention to the U.S. Constitution; what would happen if Washington mimicked Michigan’s EFM laws and designated and authorized federal EFMs to states buried in debt to step in, fire the governors and state legislatures, and make huge cuts to state budgets?
EMFs are a final act of desperation of a government terrified that any one of its citizens may actually live a freer existence without a local government. Bailing them all out is not a realistic option, and letting them die slow deaths is not an option the state wishes to entertain. Big-government states have been running in the red for decades. while states with smaller, thriftier governments have been able to maintain good fiscal health. We may one day wake up in a country where some Americans live in states where democracy is still in play, and other Americans live in states with absolute rule by rulers who were neither chosen or accountable to the people of that state.
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August 2nd, 2011 at 1:56 pm
We are all pretty nervous, if not, we are ignorant! For a moment I will back away from pontificating on the global markets ability to ignore the severe impact it could have on the US economy. I will focus on inflation and the fact that Quantitative Easing (Fed Reserve printing money it doesn’t have) is not coming to an end. We will see the first real inflationary cycle in the USA that we have not seen in many years. This is not some fictitious fear, it is happening as we speak. THE CONSUMER IS GOING TO TIGHTEN THE PURSE STRINGS. The consumer is the driver of the economy. The divide in the USA is no longer Main Street and Wall Street; it is the local municipalities vs. Main Street. The Labour issue in the country will grow at many local municipalities and will feel empowered to battle the local unions eliminating decade of achievements over collective bargaining. It does not matter what side of the line you stand on, what matter is that the country is divided. Gold is hitting new highs, why? Because people are becoming very nervous. There is a fascinating dynamic going on in the market, the smart money is short, and the USA continue to ignore a debt issue, their own budget running out of control. Senior citizens are fearful of retirement, college graduate are fearful of unemployment, and soon investors will be fearful of the US market, as cities and towns continue to get squeezed by cuts in federal funding. The GDP number on Friday, July 29th was an indication that states and local governments, which make up 12 percent of GDP, are really pulling back. The US is certainly in a double dip on housing, which is putting enormous pressure on the economy. The states most tied to housing have had to cut social programs and raise taxes, which, in turn, pushes home values down even further. Those states with “clean” balance sheets in areas “the emerging markets of the United States” attract more business, have more tax surpluses and don’t have to raise taxes. Some states are in bad shape because they relied so heavily on federal stimulus money, which ran out at the end of June. Forty-six states have passed balanced budgets that include big cuts. This affects the macro environment, this affects employment, this affects spending, this affects every corporation within the United States because so many corporations are reliant on contracts from state and local governments. The debt crisis situation in D.C. exacerbates it, but the states are in such a bad situation even without the situation in D.C. All industries will cut staff and then it will get really bad when the state and local governments really start to impact the corporations when they are forced to cut back on issuing contracts. Next it will be the municipal defaults, “muni bond defaults are just a product of overspending and overleveraging the system.