Lies the government told you by Andrew Napolitano (big screen ebook reader .TXT) 📕

bailout, we see the current establishment’s utter carelessness when it comes to the contract rights of Chrysler’s bondholders. The bondholders are secured creditors, which means by law they hold a higher ranking than shareholders or unsecured creditors in a reorganization or bankruptcy. Outrageously, though, the government— which has inserted itself into this private bankruptcy by virtue of its massive loans to Chrysler—is completely ignoring this rule and is instead awarding majority ownership to the United Auto Workers, and only a small part of ownership to bondholders.

When the bondholders tried to get a larger stake in Chrysler, President Obama publicly referred to them as “vultures,” and they eventually backed down.25 Since when are you a “vulture” just because you ask that the contract you agreed to be enforced? And since when does the President interject himself into the fray when a lender wants a loan repaid? When contracts don’t mean what they say; that’s when.

While it may be reasonable for the court to step in when a person was deceived or actually forced into a contract, it is quite another circumstance when the Court enters into a perfectly fair agreement between the parties. This often paternalistic nature of the Court does more than take away our personal liberties; it also destroys the value of the contract itself. If the Court can actually dismiss the terms of a contract, allowing a party to breach, what is the point of making an agreement in the first place? If the use of contracts is put into question, a cloak of doubt is cast on our whole way of doing business in America.

Aren’t You Entitled to the Fruits of Your Labor?

You would think that if you grew something in your own backyard, for your own personal use, the government would not meddle. Guess again! In 1940, the federal government fined Roscoe Filburn, an Ohio farmer, for producing an excess amount of wheat on his farm. The government’s act of limiting the amount of wheat Filburn grew and then actually punishing him for it, seems like a gross restriction on individual liberty in itself. But the situation gets downright ridiculous when you consider that Filburn was not selling this wheat, not bartering with it, not leaving the State with it; poor Filburn was just growing the wheat for himself and his family to use. Now imagine how outraged you would be if the government regulated the parsley you grew in your backyard garden, or the summer tomatoes you planted. You get the picture. This ruling is simply a violation of the natural right to the fruits of one’s lawful labors.

The Supreme Court used and abused the power of the Commerce Clause against Filburn in this case. The Commerce Clause gives the federal government the right to regulate commerce with foreign nations, among the states, and with the Native American tribes. While the Court’s interpretation of “among the states” has varied over the years, one of the main reasons for the clause was to prevent excessive competition between the states. The original meaning of the word regulate was “to keep regular.” Its sole purpose was to prevent states from creating state tariffs to be used to the detriment of other states.

So, basically, the Commerce Clause was intended to empower Congress to keep interstate commerce regular, that is, devoid of tariffs imposed on the movement of goods over interstate borders by the states. Such tariffs had severely hampered commerce under the Articles of Confederation and were a major impetus for drafting the U.S. Constitution. Some of the broader interpretations of the Clause have included intrastate commerce that could have an effect on interstate commerce. Yet, who would have guessed that the government could regulate something that goes from your backyard to your kitchen table and is never actually bought or sold or moved more than a few feet?

The government’s argument was that through the cumulative effect of Filburn’s use of his own wheat, and others’ potentially similar use of theirs, there might or could be an effect on interstate commerce, and that these activities were therefore subject to federal regulation. This means that if lots of people started to overproduce wheat in their backyards and consume it, it could affect the amount of bread or cereal that is being bought (or not bought) in stores. But, that is a big if. Also, the act of growing crops to provide for your own family has been going on much longer than the government itself. This harebrained reasoning employed by the government and accepted by the Supreme Court, paired with the destruction of the personal property rights conferred through Natural Law, make Wickard v. Filburn one of the more truly absurd and highly dangerous federal power trips.

Commerce Clause: No Rationality Required

Not only has the government regulated the remedies for defaulting on loans, not only has it regulated the amount of wheat grown in our backyards, it has also regulated the number of hours per day bakers can spend turning that wheat into bread. An 1897 New York State law pertaining to this, stated: “No employee shall be required or permitted to work in a biscuit, cake, or bread bakery or confectionary establishment” for more than ten hours per day. New York tried to rationalize the law by stating that the measure was meant to protect the health, safety, welfare, or morality of bakers in New York.26 Huh? Since when can the government tell people that they cannot voluntarily work more than ten hours per day? And why would bakers need to be protected from these long hours; is it particularly dangerous work?

When the Supreme Court heard this case, it looked at whether there was a legitimate need for the State of New York to regulate workers’ hours because of the nature of baking. The Court said that given the nature of certain types of work, like mining or working with coal, it may be appropriate for the state to regulate, yet there was no genuine health issue present in