Bill James'  Instablog

Self-Reliance Papers #1: Constitution's Federal Mission

This is a request to all Americans to ask the Supreme Court to use their upcoming decision on the 2010 Federal Patient Protection and Affordable Care Act, nicknamed ObamaCare, to declare The Federal-Aid Highway Act of 1956 unconstitutional. The reason both laws are unconstitutional is outlined in this paper.

The future consequences of ObamaCare may be wonderful or bad. After half a century, the unintended consequences of The Federal-Aid Highway Act of 1956 have revealed themselves as the civilization killers of Peak Oil, Climate Change and Debt. A speedy decision by the Supreme Court to assert the Constitution's limitation to only "promote" welfare is a chance to:

• Force aside powerful special interests that profit by America's oil addiction.
• End the Federal monopoly that continues to aid these civilization killers.
• Mitigate the consequences of increasing gas prices, increasing national debt to import oil, destabilizing governments, engaging in constant war to protect foreign oil and polluting that adds unknowable risks to the future climate, liberty and security of our Posterity.

I apologize for the blunt introduction of ideas and my limited writing skills. Supporting facts are in the public domain and will be provided in future papers.

Call to Action: Use rising gas price and other consequences of The Federal-Aid Highway Act of 1956 in the coming US Supreme Court judgment on ObamaCare to illustrate why all Federal provision of welfare is unconstitutional. Encourage States to assert their rights and duties to tax for and provide welfare such as transportation and health care.

Linking The Federal-Aid Highway Act of 1956 to ObamaCare is done for four practical reasons:

• There are 26 States already engaged in the ObamaCare hearing. They have a self-interest in seeing authority to tax and provide welfare restored to the States.
• ObamaCare is scheduled for a hearing at the Supreme Court on March 26, 2012 with a decision by July 2012. Despite being the driver of Peak Oil, Climate Change, Debt and wars to protect foreign oil, there are no plans to contest The Federal-Aid Highway Act of 1956.
• All acts of government are acts of "interested men." Nearly every member of the current political class derives benefit from building highways that mandate use of oil. For this reason great noise and no action results in half a century lost to solve long known problems listed above.
• Much higher prices and gas lines are likely in 2012. Linking this pain to its unconstitutional cause, while a like cause is being heard, may end all such Federal encroachments.

I know many who support ObamaCare are concerned with Climate Change and many who oppose ObamaCare support continued Federal subsidies for highways/oil. I believe survival depends on setting aside partisan differences and joining around Constitutional principles.

Being "laboratories of democracy" and providing welfare are within the mission of State governments. Within my limited understanding, ObamaCare and the 2006 Massachusetts Act Providing Access to Affordable, Quality, Affordable Health Care, nicknamed RomneyCare, seem nearly identical. RomneyCare is Constitutional for exactly the same reason ObamaCare is not. States have the Constitutional duty to both experiment with and provide welfare. The Federal mission is restricted to only "promote" welfare; Federal actions must stay focused on the awesomely difficult and rarely achieved objective to "provide defense" of liberty for us and our "Posterity."

Currently we are failing the Federal mission by depleting resources (Peak Oil) needed by our Posterity while enslaving them with Debts they have no representation in approving. Add to that failure continuous military engagements since 1990 for foreign oil. Add to that Climate Change. Civilization killers created by Federal managed infrastructure.

Background: The Constitution defines the mission of the Federal government,

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

Problem: The Federal-Aid Highway Act of 1956, provided the Interstate Highways. With 1/3rd of all miles now driven on Interstates, these highways shaped how cities were built and made oil the lifeblood of America's economy. The infrastructure built effectively mandates that to earn a living Americans must borrow money from a bank, buy a car, and buy gasoline. This mandatory purchase of products is identical to the States' objection to ObamaCare.

Solution: Self-reliance is the solution to imported oil.

Federalist #63: "so there are particular moments in public affairs when the people, stimulated by some irregular passion, or some illicit advantage, or misled by the artful misrepresentations of interested men, may call for measures which they themselves will afterwards be the most ready to lament and condemn."

As much as Americans love Interstate Freeways, our lament for the oil addiction they cause will grow and should focus on The Federal-Aid Highway Act of 1956.

Consequence: Treason. "Treason against the United States, shall consist only in levying War against them, or in adhering to their Enemies, giving them Aid and Comfort."

Addiction to imported oil is an enemy, more deadly than most. We built it and aided its expansion to 60% of our needs.

Eight successive Presidents have declared imported oil a threat to national security, an enemy of the Constitution. In the same period, government monopolies built infrastructure, including federal interstate highways and rural electrification, that has caused the loss of thousands of miles of railroads, hundreds of thousands of windmills, blocked innovations and required oil import increase from 20% to 60% of needs. As noted by Article III, Section 3 above, treason does not require intent, only giving an enemy "Aid and Comfort" as the increase to 60% of needs indicates.

Declaring the problem as treason is inflammatory. True, but blunt. In 1956 it was known that US oil production would peak in 1970, yet for short term political gain, Federal officials addicted Americans to oil. I do not doubt the elements of good intent, but the Federal mission is not to intend to defend liberty, but to defend her. Americans are now experiencing the slow unfolding of oil's Potato Famine, consequences of a monolithic dependence on a source of energy 60% outside our control. Made worse, in that we must borrow to import oil.

Scale of the Consequence: Life requires energy. Less affordable energy, less life. Oil is finite, so life and nations based on oil are terminal.

Add up all the output from all the oil wells in the United States and Peak Oil was in 1970. Federal policy has since been to sell American self-reliance for debt in exchange for imported oil. Instead of capitalizing the excessive costs of this policy so Americans could adapt in a free market, costs like oil depletion and wars to defend foreign oil were socialized into the national debt.

When anyone promises "We have a supply of natural gas that can last America nearly 100 years, and my administration will take every possible action to safely develop this energy," we should be terrified. Shifting infrastructure typically requires 30 to 200 years. Depleting the last resources while socializing the cost onto our Posterity is unconstitutional.

The Constitution requires "secure the Blessings of Liberty to ourselves and our Posterity." Solar energy is abundant, so life and nations based on forms of solar energy can achieve abundance. The only barrier to powering our cities within a solar budget by 2020 is the same barrier that kept the Internet from commercializing for 20 year: Federal commercial monopolies. We do not have an energy problem, we have a central planning problem.

Timeline on the Consequence: Political instability could collapse the oil-powered economy any day. Events in Iran and Mexico seem extremely likely to collapse the US food system in the next 0 to 18 months. At most, given world peace, geology will force the collapse along the time-line noted by the Joint Forces Command in 2010:

"By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day."

"At best, it would lead to periods of harsh economic adjustment. To what extent conservation measures, investments in alternative energy production, and efforts to expand petroleum production from tar sands and shale would mitigate such a period of adjustment is difficult to predict. One should not forget that the Great Depression spawned a number of totalitarian regimes that sought economic prosperity for their nations by ruthless conquest."

There is precious little time before our lament of higher gas prices turns to desperation for food. Plant a Victory Garden as a statement of personal commitment to self-reliance. If everyone grows a third of their own food, the coming oil supply shocks will not cause a famine.

Federalist Papers: In the 37-year struggle to establish a government based on liberty, the Founders recognized that every act of government is the act of "interested men." To limit human nature from doing harm in the name of doing good, the Federal government was to be limited, frugal, balanced and have the single mission of defending liberty. The Constitution's mission statement is specific, "provide for the common defence, promote the general Welfare"

The Federalist Papers written by Hamilton, Madison and Jay in support of the Constitution's ratification explain the intent of the Constitution. The Constitution intended that governments of the Federal and States were to have different missions and balance the other's power as they compete for the affections and willingness of the people to be taxed:

Federalist #45 (Madison): "The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite. The former will be exercised principally on external objects, as war, peace, negotiation, and foreign commerce; with which last the power of taxation will, for the most part, be connected. The powers reserved to the several States will extend to all the objects which, in the ordinary course of affairs, concern the lives, liberties, and properties of the people, and the internal order, improvement, and prosperity of the State."

The mission of the Federal government is to be the best in the world at providing defense of personal liberty and limited to being only a cheerleader promoting welfare.

Limit on the Commerce Clause

Federalist #41 (Madison): Some, who have not denied the necessity of the power of taxation, have grounded a very fierce attack against the Constitution, on the language in which it is defined. It has been urged and echoed, that the power "to lay and collect taxes, duties, imposts, and excises, to pay the debts, and provide for the common defense and general welfare of the United States," amounts to an unlimited commission to exercise every power which may be alleged to be necessary for the common defense or general welfare. No stronger proof could be given of the distress under which these writers labor for objections, than their stooping to such a misconstruction.

Had no other enumeration or definition of the powers of the Congress been found in the Constitution, than the general expressions just cited, the authors of the objection might have had some color for it; though it would have been difficult to find a reason for so awkward a form of describing an authority to legislate in all possible cases. A power to destroy the freedom of the press, the trial by jury, or even to regulate the course of descents, or the forms of conveyances, must be very singularly expressed by the terms "to raise money for the general welfare."

Madison, Father of the Constitution and Bill of Rights states unequivocally that Federal taxes would not pay for "forms of conveyances." The power to "regulate" commerce did not extend to managing commerce and is primarily intended to avoid defense entanglements. "Postal roads" is a limitation to support the technology of free speech at the time, not moving cargo or people.

Opposed to Constitutional ratification, the Anti-Federalist Papers objected that limits on powers were not specific enough to prevent the encroachments as exemplified by the Federal highway monopolies addressed in this paper:

"Those who have governed, have been found in all ages ever active to enlarge their powers and abridge the public liberty."

After the Constitution's ratification, the Anti-Federalist movement faded. Yet, Madison consolidated their concerns into the Bill of Rights and pushed through ratification. The Bill of Rights more specifically states the Federal limits to stay outside the creative-destruction of speech, religion, commerce and powers belonging to the States and the People. In a world of potential enemies and human frailties, the Federal government has a difficult, single, vital purpose: defend liberty.

The daily commitment of US military forces since 1990 in protecting access to foreign oil underscores the failure of current political leaders to enforce the primary mission of the Constitution. The need for foreign oil is a requirement of the highway monopoly.

Free Market Solutions: America is a capitalist nation for one reason, love of personal liberty.

There is no smaller minority than the lone inventor. People like Franklin, Henry, Washington, Paine, Jefferson, Madison, Goodyear, Bell, Edison, Ford, the Wright Brothers, Gates and Jobs are, at the beginning of their efforts, outcasts, traitors to the established order. For every name we know there are thousands whose contributions pushed an idea, industry or innovation ahead while their efforts went unrecognized and unrewarded. Free markets are both unkind to and the only hope of innovators.

Vendors present their ideas to customers. When the government is the customer, consistency, better "know-how" dominates. We get ever more of what we have. Solutions are then pushed on to users as the only or a limited choice.

Vendors in a free market must differentiate their offering to attract customers. Some offer lower prices, and/or better service, and/or innovation. Most innovations fail, some are elevated by customers to commercial success and a very few create a 10x, ten times better solution that shifts the paradigm to a change in "know-what." Long dormant under the Federal monopoly before 1984, the Internet, cell phones and personal computers changed the world once liberty to choose networks was returned to free market choice in 1984.

America's Founders structured the Federal government based on the need for minority innovators and the wisdom of the many. The States, innovators, and governments closer to the people were to provide a forum for minority opinions and be "laboratories of democracy" framing the choices. The Senate, representing the State governments and protecting minority views, was to represent choices applicable to the Federal mission. The House was to represent the wisdom of the many in choosing between choices.

Unfortunately, in 1913 the 17th Amendment, which established direct election of United States Senators by popular vote, shifted this balance. Four years later, in the emergency of mobilizing to fight World War I, special Interests stepped into the State roll of framing choices. Communications, power and transportation infrastructures were monopolized/socialized as "natural monopolies" with contracts granted to those special Interests. Special Interests still dominate the framing of Federal laws.

In 1984 communications was returned to free markets. A century of rotary telephones was displaced as millions of jobs were needed to create and build innovations that provided better service at lower costs. Long dormant, the Internet and cell phones found commercial niches to refine and scale to commercial acceptance. That success will be repeated once transportation and power infrastructures are returned to free markets. We will accomplish what Thomas Edison noted as practical in 1910:

"Sunshine is spread out thin and so is electricity. Perhaps they are the same, Sunshine is a form of energy, and the winds and the tides are manifestations of energy."

"Do we use them? Oh, no! We burn up wood and coal, as renters burn up the front fence for fuel. We live like squatters, not as if we owned the property."

"There must surely come a time when heat and power will be stored in unlimited quantities in every community, all gathered by natural forces. Electricity ought to be as cheap as oxygen...."

When liberty to choose transport and power networks are returned to the people, innovators will find customers to support a change in "know-what." The interaction between innovators and customers will refine innovations into commercially scale-able products.

Privately funded freight railroads average over 450 ton-miles per gallon. The Personal Rapid Transit (PRT) network in Morgantown, WV has delivered 110 million injury-free, oil-free passenger-miles. We need personal mobility, we do not need to burn oil moving a ton to move a person on congested highways.

West Point's System Engineering text identifies the problem of government monopolies:

In fact, one of the most significant failings of the current U.S. transportation system is that the automobile was never thought of as being part of a system until recently. It was developed and introduced during a period that saw the automobile as a stand alone technology largely replacing the horse and carriage. So long as it outperformed the previous equine technology, it was considered a success. This success is not nearly so apparent if the automobile is examined from a systems thinking perspective. In that guise, it has managed to fail miserably across a host of dimensions. Many of these can be observed in any major US city today: oversized cars and trucks negotiating tight roads and streets, bridges and tunnels incapable of handling daily traffic density, insufficient parking, poor air quality induced in areas where regional air circulation geography restricts free flow of wind, a distribution of the working population to suburban locations necessitating automobile transportation, and so on. Had the automobile been developed as a multilateral system interconnected with urban (and rural) transportation networks and environmental systems, U.S. cities would be in a much different situation than they find themselves in today.

What is important here is not that the automobile could have been developed differently, but that in choosing to design, develop and deploy the automobile as a stand alone technology, a host of complementary transportation solutions to replace the horse and buggy were not considered.

The highway monopoly caused the loss of thousands of miles of railroads and delayed expansion of Personal Rapid Transit (PRT) networks since Morgantown. My understanding in this paper is based on a 12-year effort to invent and build JPods PRT. JPods are ultra-light personal railroads that cut the cost of urban transport from 56 cent a mile for your car to 4 cents a mile. Cutting energy required by 85% makes it possible for solar collectors over the rails to gather 5,000 to 30,000 vehicle-miles of power per mile of rail per day: urban transportation within a solar budget. This 10x savings allows the networks to be built and operated with private capital. Our to-date rejected request of government monopolies has been to allow a free market by granting rights-of way access to anyone that will:

• Pay 5% of gross revenues to the aggregate rights of way holders.
• Exceed 120 passenger-miles per gallon or energy equivalent.
• Exceed the safety record of highway networks.
• Properly insure and inspect the networks in compliance with insurance and commercial standards.

My hope: That the Supreme Court's decision on ObamaCare will declare The Federal-Aid Highway Act of 1956 and all Federal monopolies unconstitutional. Five million jobs will be created within 4 years and American cities will be powered within a solar budget by 2020. We have a bright future.

If we unleash private capital's ability to provide innovative energy-efficient transportation, a rapid transition to abundance is possible. On the other hand, if we remain in denial of our addiction oil and debt, weaning ourselves is going to be very painful. Meaningful work but painful.

Disposable Energy is how much energy a family's disposable income will buy, energy we can apply to accomplish economic work towards our happiness. Disposable Energy shows what

most families currently feel, a crash similar to the 1973 Oil Embargo. Oil powered economies in the US and Europe are collapsing at the relentless pace of oil field depletion.

Life requires energy. Affordable access to oil energy is crashing. Our choices in the next few months will play out over the next 20 years in one of two choices:

• Embrace self-reliance, end unconstitutional Federal monopolies that created the civilization killers we face, change the lifeblood of our economy from oil to ingenuity, cutting energy required per passenger-mile by 85%, or,
• Cling to our oil addiction until political instability or oil field geology results in nature cutting the number of passengers by 85%.

Current interests will likely fight to delay ending monopolies that protect their interests from free market competition. So a Supreme Court decision that enforces the Constitution and ends Federal policy that mandates oil addiction seems a key way to get timely action.

Federalist #42 (Madison): "But the mild voice of reason, pleading the cause of an enlarged and permanent interest, is but too often drowned, before public bodies as well as individuals, by the clamors of an impatient avidity for immediate and immoderate gain."

Self-reliance is local, We the People, self-reliant, are the foundation of individual liberty:

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

Thanks

Bill

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Additional disclosure: Author is the founder and fully invested in JPods, Inc.