It Is Dangerous to Be Right When the Government Is Wrong - Andrew P. Napolitano [28]
Second, with the increased uncertainty in the whole market, investors will pull their money out and search for greener pastures. Also, because of this decreased profit incentive, landlords will not reinvest in their properties for such things as ordinary maintenance, thus causing the property to deteriorate over time. This, surprisingly, is something all economists tend to agree on. Socialist economist Assar Lindbeck even stated, “In many cases rent control appears to be the most efficient technique presently known to destroy a city— except for bombing.”8
30
Setting the Precedent for Destruction
Where did the federal government get the power to regulate all economic behavior? Wickard v. Filburn (1942) was the case that greatly increased the federal government’s power to regulate our lives. Roscoe Filburn, an Ohio farmer, produced wheat in excess of the amount allowed by the Agricultural Adjustment Act of 1938. He was not selling the wheat, or bartering with the wheat; he simply grew the wheat, on his own land, for his own personal consumption. Mrs. Filburn ground the wheat into flour and used the flour to bake bread for the Filburn family. The Roosevelt administration, drunk on New Deal socialism, effectively told Mr. Filburn to stop growing so much wheat for his family and told Mrs. Filburn to stop baking bread and cookies for their children. (FDR was in the period of his wretched life during which he was admiring and imitating his dictator friend, “Uncle” Joe Stalin.) There was no commercial activity and no interstate activity taking place with this wheat; so then, how could the federal government restrict the amount of wheat a person grows on his own land, for his own consumption?
The Interstate Commerce Clause in the Constitution was designed to give Congress the power to regulate commerce between foreign nations, states, and with Native American tribes. The original meaning of the word regulate was “to keep regular.” Its sole purpose was to prevent states from creating tariffs to be used to the detriment of merchants in other states. When the feds sought to fine Filburn for growing and consuming too much wheat, the Supreme Court of the United States ruled that if farmers were allowed to grow any amount of wheat they wished, this in the aggregate would affect the price of wheat, which would affect interstate commerce, thus validating the Congress’s power to regulate interstate commerce. Of course, everyone knows that growing and consuming your own wheat that you grew in your backyard is not a commercial activity, takes place in one state, and has no measurable effect on interstate commerce. Somewhere Madison is fuming.
31
Congress has since abused this power to no end. 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 regulated the number of hours per day bakers can spend turning that wheat into bread, and the wages they can be paid, and the temperatures of their ovens!
The Gift that Keeps on Giving: The Community Reinvestment Act of 1977
The government completely trampled the right to contract freely in the Community Reinvestment Act (CRA) of 1977. It essentially mandates that banks contract with less-than-desirable borrowers in an effort to increase home ownership across the nation. No mutual consent was required; rather, the government coerced private banks to abandon their traditional business practice, all in the name of political gain and extra votes.
During the Carter administration, people accused mortgage lenders of racism because poor urban dwellers who were mostly black were being denied loans, while suburban whites were not. Seeking to reduce “discriminatory” credit practices against low-income neighborhoods (this practice is called redlining), Congress took this indictment as a green light to do anything