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Political Economy and Constitutional Reform Hearings

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Political Economy and Constitutional Reform Hearings POLITICAL ECONOMY AND CONSTITUTIONAL REFORM HEARINGS BEFORE THE JOINT ECONOMIC COMMITTEE CONGRESS OF TUE UNITED STATES NINETY-SEVENTH CONGRESS SECOND SESSION PART 1 NOVEMBER 9, 17, 18, AND DECEMBER 16, 1982 Printed for the use of the Joint Economic Committee U.S. GOVERNMENT PRINTING OFFICE 14-523 0 WASHINGTON: 1983 JOINT ECONOMIC COMMITTEE [Created pursuant to sec. 5(a) of Public Law 304, 79th Cong.] HOUSE OF REPRESENTATIVES SENATE HENRY S. REUSS, Wisconsin, Chairman ROGER W. JEPSEN, Iowa, Vice Chairman RICHARD BOLLING, Missouri WILLIAM V. ROTH, JR., Delaware LEE H. HAMILTON, Indiana JAMES ABDNOR, South Dakota GILLIS W. LONG, Louisiana STEVEN D. SYMMS, Idaho PARREN J. MITCHELL, Maryland PAULA HAWKINS, Florida AUGUSTUS F. HAWKINS, California MACK MATTINGLY, Georgia CLARENCE J. BROWN, Ohio LLOYD BENTSEN, Texas MARGARET M. HECKLER, Massachusetts WILLIAM PROXMIRE, Wisconsin JOHN H. ROUSSELOT, California EDWARD M. KENNEDY, Massachusetts CHALMERS P. WYLIE, Ohio PAUL S. SARBANES, Maryland JAMEs K. GALBRAIrH, Executive Director BRUCE R. BARTmrr, Deputy Director (H) FOREWORD By Hon. Henry S. Reuss, Chairman The Joint Economic Committee's hearings on Political Economy and Constitutional Reform, along with the papers and other mate- rial published in the Appendix, contain the observations and recommendations of some of the most thoughtful critics of the American political system today. During three days of hearings in November 1982, the Committee brought together more than a dozen academics, journalists, and former government officials and lawmakers to discuss how we could improve the performance of our political system, and the performance of our economy, by making changes in the structure of our government and, if necessary, in our Constitution. The Appendix complements these hearings by making available in one place a wide variety of other material on these same issues, culled from books, academic and law journals, popular magazines, and other sources. I hope these two volumes will be useful to those who believe that our democracy can be made to work better. * * * * * * * In 1987, the United States will celebrate the bicentennial of our Constitution. It was a marvelous document 200 years ago, and it re- mains a marvelous document today. It marked the first time a Nation created itself and its people set the rules of government. As Henry Steele Commager testified: Their achievements, then and in later years, cannot but fill us today with awe. They did indeed bring forth a new nation-the first time men had ever deliberately done that . .Ours was, at the beginning, the most enlightened, the most mature, and the most inventive and innovative of all governments on the globe . What a sobering fact that every major political and constitutional institution which we now boast was created before the year 1800 and not one has been created since. In our Constitution, the Founding Fathers created a structure of government based on the separation of powers between President and Congress and a system of deliberate checks and balances; judi- cial review of acts of Congress; popular election of the President and Congress; a constitutional amendment process; and a Federal system with powers and responsibilities shared by the national and state governments. It is a structure that has generally served our Nation well through its various stages of growth, from undeveloped backwater to powerful industrial nation, from amalgam of former colonies to world leader. (III) IV In these 200 years, the Constitution has weathered many crises. Our form of government has endured wars and depressions which would have destroyed other governments around the world. We are fond of our form of government, and we have done well under it. But during the past decade, our government has often seemed paralyzed as the economy had been battered by one crisis after an- other. The separation of powers between the President and Con- gress, the decentralization of power in House and Senate, the decline of the parties, and the rise of the media politician have un- dermined the ability of our government to respond effectively. Through three recessions, two oil-crises, two periods of prolonged inflation, and three periods of skyrocketing interest rates; through an entire decade of low productivity growth, inadequate business investment, stagnant output, and falling real incomes-our govern- ment stood helplessly by, unable to develop or implement effective economic policies. The just-concluded lame duck session of the 97th Congress illus- trates the paralysis. The session convened with a mandate from the November 2 election to address the Nation's crisis of recession and unemployment. By any fair estimate, the lame duck session failed. It failed to make contact with the looming out-year budget deficits, either by checking the growth in military spending or the decline in tax rev- enues. It failed to enact even a token public works and jobs pro- gram. (Its one "jobs" enactment, the 5-cent gasoline tax increase, will subtract more jobs than it adds.) Finally, toward the end, in an unedifying debate about the size of trucks, the session failed even to keep the government open and operating. This is stalemate-stalemate by fear of Presidential veto, stale- mate by Senatorial filibuster. December 1982 reduced the confi- dence of the American people in their government. Those who love fishing know well that the secret of success is proper structure-a waterlogged stump, a pile of rocks, a steep drop-off. If the structure is right, you will catch fish. As in fishing, so in life. Particularly in politics and economics, good structure is necessary for good policies. Until very recently, our political and economic structure was a source of strength. Our constitutional system of checks and bal- ances, of divided sovereignty and separated powers, worked. So did our economic system of free enterprise tempered by concern for human welfare and by a governmental undertaking to assure suffi- cient demand to buy what could be produced. But no longer. In government, for more than a decade, the judg- ment of the people is that President and Congress have been fail- ing. Back in 1966, almost 42 percent of the American people said they had a great deal of confidence in the Congress and the President; by 1979, less than 18 percent felt any such confidence, according to a Lou Harris poll. And, except for the slight increase registered in the 1982 mid-term election, participation in elections has been steadily declining. v In economics, nearly full employment without inflation has given way to disastrous bouts of escalating prices, prolonged joblessness, and impossibly high interest rates. A leading reason for these.miseries is deteriorated structure. If the passage of the years rearranges the rock piles on your favorite fishing lake, it may cease to meet your expectations. And, if the ravages of time and man have caused malfunctions in our political and economic structures, this may contribute to our present discon- tents. As Senator Claiborne Pell writes: Our government is not responding as effectively as it should to the serious problems and challenges that con- front our Nation and the American people in a rapidly changing world. Increasingly, our government's best efforts to deal effec- tively with such problems as inflation, energy supply, pro- ductivity, or arms control, to cite a few important exam- ples, end in a stalemate among conflicting views and divid- ed interests. The result, all too often, is inaction, policies warped or diluted beyond recognition, and ultimately, frustration, stagnation, and a diminished public respect for govern- ment itself. In my view, the sluggish response of our government to the major challenges facing our Nation is not a judgment of the ability of any President or of the Congress and its leaders or of the Supreme Court. Nor is it a question of po- litical party. It is instead a judgment of how well this gov- ernment as an institution responds to clearly identifiable, major problems as they arise. Our Constitution envisages the separation of powers between the executive and legislative branches of government. The Founding Fathers broke with the parliamentary tradition of drawing the ex- ecutive from the legislature for what was then a good reason-to prevent the kind of executive tyranny which led to the American Revolution. As James Sundquist told us: When the Founding Fathers met in Philadelphia in the summer of 1787, they were preoccupied with the threat of tyranny. Having won freedom from the despotism of George III, and having experienced arbitrary rule from some of the new state legislatures, they were resolved that the Constitution they were drafting must protect the young republic against the concentration of governmental power. So they dispersed the powers of government-divid- ing them first between a Federal Government and the states; then at the national level between separate legisla- tive, executive, and judicial branches; finally, within the legislative branch, between two independent bodies, a Senate and a House of Representatives. This unique structure of "separation of powers," of "checks and balances," has served well the purpose of averting tyranny. In its nearly 200 years under the Consti- VI tution, the republic has never been menaced by autocracy in any form. How ironic, then, that the very mechanism which for 200 years has so successfully preserved our liberties looms today as an almost overwhelming impediment to effective government. Sundquist con- tinues: A governmental structure deliberately designed to frus- trate a despot who seeks to assemble its powers for evil purposes must also, inevitably, frustrate democratic lead- ers who have been chosen by the people to exercise its powers for good and worthy ends. That is the dilemma of the American constitutional system. The checks and balances created in the Eighteenth Century to guard against the perils of that day have led repeatedly, in the Twentieth Century, to governmental stalemate, and deadlock, to an inability to make quick and sharp decisions in the face of urgent problems.
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