8E411's  Instablog

Send Message
Day trader, technical analyst, research assistant, business manager, husband, father, mentor, Eagle Scout. I wear a lot of hats, and they all fit just right.
My blog:
  • Time For A Constitutional Amendment 2 comments
    Dec 31, 2012 10:02 AM

    To borrow from the movie "Network" ... I'm mad as hell, and I'm not going to take it anymore.

    I'm nobody special - your typical middle-income American. My wife and I have a modest home with a modest monthly mortgage that we have paid monthly for over 20 years. With that simple discipline, we avoided being beneficiaries of the housing bubble ... and likewise avoided being victims of the bubble bursting. We have two cars, both of which are over seven years old and paid for in full. We have two children, both of whom are attending college (out of state) and for which we have had to sign for substantial student loans. We have no illusions about those bills coming due - and are planning for them accordingly.

    Simply put: we have lived within our means for our entire lives - much like millions of other Americans just like us. And yet, we are facing payment of a monstrous bill that was not of our making ... and which our elected leaders cannot stop bickering about long enough to actually demonstrate some rudimentary fiscal responsibility.

    Our nation has collectively been sitting on the edge of its seat since before the election on November 6th, waiting for leadership and direction (ANY leadership and ANY direction) out of the political leaders in Washington. In spite of early promises that issues would not remain unresolved until the end of the year, we have now arrived at December 31st and are standing at the precipice of a fiscal cliff of their creation. We have received little from Congress and the President beyond finger-pointing, blame, and rigid insistence on inviolable party positions.

    With one exception - on Friday the President approved a raise for all members of Congress.

    In the wake of the global financial crisis of the last four years, the one thing needed most from these officials - leadership - is shamefully missing. Even the most tenured followers of American politics have indicated they have never before seen such extreme partisanship in our country.

    The real question our nation needs to be facing, in the wake of this dearth of common sense leadership, is how we can most effectively hold our elected leaders responsible for their actions (or lack thereof). The most rudimentary argument of course centers on term limits; the contrarian view asserts that in fact term limits already exist (they're called elections). The fact remains that our nation's political landscape, and more importantly its election process, have been overtaken by the influence of two things: money and job security. Incumbents can spend unholy amounts on re-election campaigns, funded by donations from corporations, political action committees, and wealthy donors too numerous to count.

    So if we citizens have completely lost the ability to hold our elected leaders accountable (and I believe we have), what course of action can we find that would possibly make them turn away from their committed path of divisiveness and inaction?

    I believe Warren Buffett was prescient in his CNBC interview of July 7, 2011: "I can end the deficit in five minutes ... You just pass a law that says that anytime there's a deficit of more than 3% of GDP, all sitting members of Congress are ineligible for re-election." www.cnbc.com/id/43671706

    Article V of the U.S. Constitution mandates that Congress propose amendments to the Constituion on application of the Legislatures of two-thirds of the states. (Alternatively, a Constitutional Amendment can be proposed by two-thirds approval of both the Senate and the House of Representatives, but I believe the prospect of that happening is laughable). Once proposed, an Amendment is ratified and added to the Constitution upon approval of 75% of the states.

    I would love to see an Amendment to the U.S. Constitution that considers the following:

    - Warren Buffett's aforementioned position. It holds members of Congress accountable for their own action. If they choose to operate the country in a fiscal imbalance that exceeds 3% of the country's gross domestic product ... their current term is their last term.

    - I would further expand Mr. Buffett's position by including the mandate that Congress pass a budget. There will be no forther opportunities for "extensions" which allow the government to continue to operate without a budget in place. This budget must also account for a minimum 5% reduction in the national debt per year.

    - Finally - until such time as the United States no longer carries a national debt, all federal budgets MUST be balanced. Spending cannot exceed the prior year's actual income; budgets cannot use projected income as a valid determinant of revenue.

    Additional provisions I would like to see enacted:

    - An end to Congressional pensions. Serving in Congress was NEVER meant to be a career position - and the notion of former members continuing to draw their salary after leaving office is utterly laughable. Can you think of any employer that would willingly pay your salary to you, for life, after you leave their service? Neither can I.

    - Elimination of tenure. Continually re-electing someone because of their seniority, and therefore the position (and influence) they hold in Washington, simply interferes with our senators and representatives acting as true representatives of their own constituency.

    - Members of Congress pay into the Social Security and Medicare systems, the same as all other Americans. They will, of course, also be entitled to receive such benefits upon reaching the appropriate age.

    - Members of Congress may avail themselves of the same opportunities for retirement planning as all other Americans. The Congressional Retirement Fund will be eliminated; all funds will be transferred to the Social Security system.

    - Funds in the Social Security and Medicare systems CANNOT be used for purposes of balancing a federal budget. These entitlements are committed for a specific purpose; consequently, it is immoral and irresponsible to use these figures for purposes of balancing the ledger.

    - Elimination of unfunded mandates. All expenditures anticipated for government mandated programs (Social Security, Medicare, etc.) must be accounted for in the annual budget. It will be unlawful for Congress to pass a budget that reflects a shortfall in funding for mandated programs.

    - Congressional health care is eliminated. Members of Congress shall avail themselves of the same health care opportunities available to the general public.

    - It will be unlawful for Congress to vote itself a pay raise. Any raises received by members of Congress will be capped by the annual calculated cost of living increase applied to Social Security and Medicare.

    - All provisions of this Amendment are retroactive to all previous members of Congress. Any and all existing contracts with and benefits to current and prior members of Congress are revoked.

    How pracitical is this, really ... and what are the chances it could actually be done?

    The timing on this is PERFECT: We are at the beginning of a new legislative session, with 22 months until the next (mid-term) Congressional elections. There is ample time to force a change in our electoral system; seven of the 27 Amendments to the Constitution were implemented in less than one year. The 26th Amendment (granting the right to vote at age 18) was ratified exactly 100 days after it was passed by Congress.

    It is undeniable that the demands on American's time have grown substantially in recent years ... as has the volume of information that we are bombarded with. I believe these increased demands on each of us have unfortunately brought more reliance on others' decision-making (particularly our politicians). The grass-roots efforts to make sure our elected representatives hear our voices, and more importantly take need of them, have been evaporating. The only way for Americans to actually take control of our nation's current lack of fiscal discipline is (to borrow from Nike) to just do it. The alternative does not bear further consideration.

    No rational mind can argue that our current fiscal path is sustainable. The longer we allow it to stay that way, the more dire the consequences when we finally find the courage - or the leadership - to comprehensively resolve the problems.

    "The only way to change something that's not sustainable is to change it." - Warren Buffett

Back To 8E411's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (2)
Track new comments
  • dreammil
    , contributor
    Comments (2) | Send Message
    @Tim S. Great piece sir, nice structural thinking. I vote for all of it. The best idea is to make deficit cutting metrics as measure of their performance. How do you make a senator to think about good of the country before agenda of his party to stay in power. Once they started to be paid for their service, forget it.


    I don't believe Pelosi really cares to tax rich, she just have to say it like a speaking Barbie, it is just the agenda of the party. And dems party leaders are rich, they shouldn't care about taxing rich, they just have to have some contrarian agenda to the reps always, because otherwise reps would dominate elections. Now they should all stick to agendas they have, just to keep it contra.


    Another case to the point, reps just conveniently have some higher guidance coming from religious traditions, consequently they would automatically take side against gay marriage , so what dems to do - vote in favor. They even forget why they like the idea so much, all sane people know that there is nothing beautiful and sacred about it, just another unfortunate side effect of civilization, but now they have all LGBT on their side. Let's keep sticking to what's working, right dems?


    Reps wanted to cut down on illegals, because they think it is actually responsible thing for the government to act according to the law, not disregarding the law. Ok, dems what to do? Ease for illegals obviously, with some meaningless reasoning that they have value for our progress, who cares about breaking laws. Of course they have value to vote for dems.


    Reps wanted to cut budget deficit, ok maybe it is honest, despite so many of them caught voting for earmarks by our "lovely MSNBC team" (hate these commies) and many reps are presumed being supported by traditional reps industries like defense, smoking, oil, which also will be hit by cliff big time. But maybe regardless the interests, just to be contrary again, because it is their last leverage against dems increasing taxes? Need to keep con to dems, beside all pork, right?


    That is what happening. Country has 2 parties to make democracy work, but now parties become so big, that they play for the party itself, not for the country. And they slowly working on replacing logic by absurd, well maybe dems more than reps, but they are much better in making everybody believe that they aren't as bad, and they against rich.


    New game - the biggest achievement of dems in the last crises: all these 99% who still live in mother's basements, instead of wanting to become rich now think that rich is not cool. Country is being ruled by big game between parties, and not to achieve some greater good. It is surreal, and that is the root explanation why trillions became old billions, why illegals are now to be glorified by the president, how success is to be punished, how being rich is not cool, how welfare state is encouraged and incentive to raise above and become giver, not taker, is eliminated. Welcome to Obama's century, remember Clinton's fetish speech "...we will build the bridge to 21st century...", that was bridge to Washington absurd.


    Everybody now dislike Washington, but guess what - they will forget soon, make wrong conclusion and vote for the Mr. Wrong next time again. Maybe it was always this way about politics, but did politicians ventured before to attack and restrict the very basics of capitalism and private entrepreneurship?


    It would be great to change law to somehow legally help democracy work again. Mathematically your writing exercise is very exciting, how do you make it practical? Rules are complex already, may be we should simplify them?




    1 Jan 2013, 01:28 AM Reply Like
  • dreammil
    , contributor
    Comments (2) | Send Message
    Can I add my 2c:
    1. Voting rights only for taxpayers and people who retired or unemployed, but paid more than $3,000 in taxes in the past for at least 3 in the last 5 years, or over 15 years in their life. What is the value of voters who can't legally buy booze and never paid taxes yet to all of a sudden vote for president, just because they know how to organize via Twitter?
    2. No reelections ever for any government position, including Capitol Hill. Why would anybody like sitting ducks on the spot which should be used for some important activity or why would anybody wants to elect somebody who will spend most of his energy thinking of reelection. One term, at least we pay for the work, not for campaigning.
    3. Election system should be dismantled entirely and replaced with direct internet referendums to save money and establish real democracy versus political democracy, eliminate possibility of indecisions, inactions and filibusters. I know there is a possibility of computerized conspiracy, still better than current system. People who like election system, do you like your dysfunctional elected officials now? It is pathetic in the era of internet and 747 jets to have voting system invented in 17 century with equestrian transportation and messenger's communications. (or wait, it wasn't 17 century, it was modeled on Romans)
    4. Senators, representatives, pres and vice pres should not be paid salaries or benefits, period, and no 2 Mln fed budget for first lady office. They should be paid out of their election campaign money. People who want candidates to be elected should know that the guy will really make something meaningful, not just occupy spot, and be glad to pay for them. For example why should I pay for this guy now? I should send him my money while he fly Airforce1 campaigning for Obamacare? If someone voted for pres who is busy thinking of his position on gay marriage let him pay for his nice life in the White House, this someone should now pay for the pres of his choice, not me. And for Corporations and people making over 1 Mln they should be able to finance campaigns unlimited, but only if they make matching donations into Medicare fund and Defense budget maybe 60/40.
    5. Reduction of social program budgets should be achieved only by reducing waste, not by cutting programs. Government is as inefficient as socialist states. When the budget cut, they just cut program, coverage, or benefits, there are no incentives to actually govern this programs efficiently and prevent waste. The entire management is to cut program when the budget cut, or add program when budget increased. Who would care about efficiency? Even I would like to manage this way. (My neighbor on the medicare/medicaid got $5,000 electric scooter, which he never used, and almost got into hip replacement surgery ($20,000) by his doctor last summer, his son interfered and prevented that, this old guy doesn't move out of bed in the nursing home for already 2 years, how would he benefit from the new hip).
    6. No lobbyists in Washington, just prohibit it by law. Senators can do whatever they want in their state offices, get any influences I don't care. But you elect this guy, you trust he will work for you, you send him to Washington, and all of a sudden he is surrounded by all this lobbyists with special interests in Washington, would he remember his promises?
    1 Jan 2013, 01:30 AM Reply Like
Full index of posts »
Latest Followers

Latest Comments

Most Commented
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.