9. Devolve Unconstitutional Spending

A Plan to Renew the Promise of American Life, Plank 9

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Plank 9. Devolve unconstitutional spending. 


Specific Recommendations

9.1. Review all 2,200 federal departments, agencies, programs, and activities, to determine whether each is constitutionally authorized and best carried out by the federal government, as opposed to the states or private actors.

9.2. Eliminate or devolve every federal department, agency, program, function, and activity that is not constitutional, necessary, affordable, and moral.

9.3. Follow a basic strategy of block-and-devolve, with respect to any program that cannot be justified, according to the following formula: If it cannot be justified, eliminate it. If it cannot be eliminated, devolve it. If it cannot be devolved, block-grant it. If it cannot be block-granted, reform it to make it block-grantable, and then block-grant it. And then, as soon as possible, devolve it.

9.4. Eliminate or devolve to the states all special preferences, welfare, and grants-in-aid, and all income-support programs not associated with federal employment.

9.5. In the special case of joint state-federal programs like Medicaid, where block-granting may be impeded by state reluctance, it may be necessary, for practical political reasons, to break Medicaid up into multiple sub-block grants, focused on its main sub-populations. And it may even be necessary, as a first step, to make the program all-federal (i.e., relieve states of the financial burden of helping to finance it), in order to get it under control, and then reform it to make it block-grantable or devolvable.

9.6. As a first step to necessary reforms of Social Security and Medicare, eliminate the federal payroll tax and fund these programs entirely from general revenues.

9.7. As a matter of principle, make participation in all federal welfare, health insurance, and income-support programs optional for individuals. For example, eliminate the individual mandate penalties in Obamacare and Medicare. In the same spirit, soften the late-enrollment penalties in Medicare Parts B and D. And do not impose such mandates or penalties under other guises.

9.8. In the area of narcotics control, devolve federal expenditures and activities to the separate states and terminate the failed federal drug war, which, like alcohol Prohibition, has fueled organized crime and gang violence without suppressing demand or reducing addiction rates. Amend federal drug laws and treaty commitments as necessary to effectuate a return to federalism and common sense.

Explanation

Reform should focus less on reducing wasteful spending than on eliminating unauthorized spending. The first goal of reformers at the federal level should not be to ‘root out waste’ or ‘run government like a business.’ The first goal should be to get the federal government out of those lines of business that it should not be in.

Of every activity, we must ask a four-part question: ‘Is it constitutional, necessary, affordable, and moral?’ If the answer is ‘No’ or ‘Unclear,’ it should not exist.

  1. To be ‘constitutional,’ spending must be authorized or commanded by the U.S. Constitution. Since the Constitution is framed as a grant of limited, enumerated powers, we must always assume that any power not expressly granted, or implicit in a granted power, is withheld: it is reserved to the states or the people. (Tenth Amendment.) To keep Congress’s legitimate powers from becoming unbounded, we must construe those powers as narrowly as possible without falling into absurdity. (Ninth Amendment.)
  2. To be ‘necessary,’ spending must be governmental in character and its purpose clearly unachievable by state or private entities absent federal involvement.
  3. To be ‘affordable,’ spending must be compatible with a policy of routine, modest surpluses, both in terms of volume and growth rate, must achieve its purposes, and must not suffer from high rates of waste, fraud, or abuse.
  4. To be ‘moral,’ spending must be inherently just, decent, and non-injurious.

As a rule of thumb, if the states have the ability do a thing and aren’t constitutionally prohibited from doing it, and if the feds aren’t given exclusive power to do it, then the states should do it and the feds should not.

Activities identified as unauthorized or unnecessary must be eliminated or, where advisable, devolved to the states and the private sector.

To ‘devolve’ an expenditure means to simultaneously eliminate it while reducing federal receipts by the same amount. Devolution leaves the states and private sector free to continue the federal spending at their own level, if they wish. Devolution can occur at any time, but it should never be done gradually. It only works if done in one fell swoop.

1. Special Preferences

Special preferences—policies that favor some interests over others, or attempt to pick winners and losers in the marketplace, whether through spending, taxation, or regulation—should be eliminated because they do not provide for the general welfare of the United States.

2. Welfare

The federal power to provide for the general welfare does not include a power to take care of our needs, share the wealth, fight poverty, ensure social security, promote local or regional economic development, educate your children, or promote social uplift. All such powers are left to the states and the private sector. For example, the federal government has zero warrant to be involved in education, except where necessary to carry out its national defense and civil rights powers. Likewise, its health care financing programs and its various income-support programs. All such federal welfare programs should be removed from the federal books. It does not matter whether or not federal assistance goes to individuals or to state governments, nor whether aid takes the form of spending, taxes, or regulation. But consolidating welfare programs into grants-in-aid (block grants) is a permissible transitional step, provided it is understood to be transitional.

3. Entitlements

Entitlements are unconstitutional and unnecessary (at the federal level) and therefore must be eliminated or devolved, although, given people’s dependency on them, a phaseout period is unavoidable. Apart from the context of federal employment, Congress has no power to provide people with pensions, health benefits, and the like. The Supreme Court has repeatedly affirmed this, most famously in Nestor v. Flemming (1960).

‘Earned’ Benefits. Medicare and Social Security are structured to look like earned benefits, but they are not. As a legal matter, they’re welfare. Why, then, do entitlements exist? Because the Court has embraced two politically convenient notions: first, that Congress’s power to tax-and-spend for the general welfare and common defense is not limited to carrying out the enumerated powers, but is pretty much unbounded; and second, that, while Congress has no power to provide ‘social insurance,’ it may in effect do so, as long as it treats the program’s payroll taxes and welfare spending as if there were unrelated.

The test of whether ‘earned’ benefits really are earned is whether anyone could sue the government if Congress abolished or reduced the benefits. And when it comes to Social Security and Medicare, no one could. Citizens have no legal recourse. Why? Because those benefits don’t belong to us. They belong to the government.

Obamacare and Medicare. Both Obamacare and Medicare rest on an individual mandate to participate in the program. (If you try to disenroll from Medicare, the government will automatically take away your Social Security retirement benefits and make you repay any Social Security benefits received to date.) These mandates are un-American and should be repealed. (I’m speaking here about the mandate to accept benefits, not the mandate to pay taxes.)

4. Earmarks

As long as earmarks meet the basic, four-part test set out above, they are acceptable. But they should be watched. While not inherently evil, they are potentially dangerous, because they can easily serve as legislative bribes. They can be used to grease the skids for bigger government.

Conclusion

The basic strategy for dealing with entitlements should be ‘block and devolve.’ If it cannot be justified, eliminate it. If it cannot be eliminated, devolve it. If it cannot be devolved, block-grant it. If it cannot be block-granted, reform it to make it block-grantable. And then block-grant it. And then, as soon as possible, devolve it.

And: If it’s compulsory, make it optional.

P.S. There are many federal programs that don’t work, and deserve to be sent back to the states and the private sector. One that deserves a special mention is the war on drugs. Like alcohol Prohibition, the federal drug war has indisputably failed. It’s time to end it.


Constitutional Amendments

This plank does not require any constitutional amendments.


Benefits

Will reduce federal spending and help make it more manageable under a balanced budget.

Will increase justice and freedom and encourage greater individual self-reliance.


Summary

Plank 8     Contents     Plank 10

Revised: October 4, 2017.

Published: June 21, 2013.

Author: Dean Clancy.