A Call to Action for Washington Libertarians!!!

Dear friend of the Libertarian Party of Washington,

America needs your help urgently! The gravest threat to our individual liberty since passage of The Patriot Act is upon us. Unless We The People make our dissent heard, the US Congress is about to impose an economic dictatorship that will nationalize the American banking industry.

I choose my words carefully. Section 8 of Treasury Secretary Paulson’s proposal* states “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”

Stop and re-read that sentence. It gives the Treasury Secretary unlimited power to do whatever he wants, without fear of a court looking over his shoulder. Because it violates the Rule Of Law by prohibiting judicial review, it gives the Treasury Secretary permission to ignore the US Constitution. The limitation implied by “pursuant to the authority of this Act” is a sham, because no court will be permitted to dispute the Secretary’s idea of what that phrase means. At the least, the US Government will be able to seize private property without just compensation. At the worst it permits suspension of all civil rights, including the ability to speak out against the act once it is enacted. There is no limit to the authority given the Treasury Secretary in this proposal.

Another part of Secretary Paulson’s proposal nationalizes the American financial sector. This is not hyperbole. Section 2(b)(3) authorizes the Treasury Secretary to be “designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them.” The word “reasonable” is designed to calm people’s fears, but it will not limit government action in the least. The word will mean anything the Secretary says it does, because courts will not be permitted to question his definition. This section gives the Treasury Secretary dictatorial power over all financial institutions.

Section 9 is a sunset provision. I expect it will be as effective as those in the Patriot Act were.

When Secretary Paulson tried to justify these proposals on This Week With George Stephanopoulos, the host said “Conservatives are saying this smacks of Socialism.” Paulson responded by saying how he was opposed to intervention, but finished with “I would just tell you it’s necessary right now.”

The Libertarian candidate for President, Bob Barr, disagrees. “Capitalism involves losses as well as profits. When government tries to insulate businesses and investors from paying for their mistakes, we all lose. In a Barr administration, there would be no more corporate bailouts or takeovers. The days of loss-free capitalism would be over."

I will give you more details in a moment, but I think you are getting the idea of what a pernicious idea this bailout proposal is. These three sections alone make this proposal every bit as dangerous as The Patriot Act. It must be stopped before our entire financial system is nationalized into another government agency as efficient as FEMA.

Here are three things you can do to protect our financial freedom and civil liberties:

FIRST: call both your US Senators. Say “I want my Senator to vote AGAINST the bailout proposal when it comes up for a vote this week.”

SECOND: call your US Congressman. If you aren’t sure who that is, go to http://www.congressmerge.com/onlinedb/ and plug your address into the form on the left. The website will tell you who your Congressman is, and will give their DC phone number. USE THAT NUMBER to tell your Representative that you want them to vote NO when the bailout comes up for a vote this week.

THIRD: Write letters to the editors of your newspapers. Email them if possible so they have the chance of getting printed quickly. Keep them to less than 250 words. If you concentrate on only one part of the bailout proposal in your letter, it is more likely to be printed. Make sure you include your name and your cell phone number, because most papers call letter writers to confirm that they are the ones who wrote it.

I told you I would give you more details about other dangers posed by the bailout proposal. It ain’t pretty.

The act authorizes the Secretary to buy up mortgage related assets from any American financial institution. When the Chinese and the Saudis sell their bad mortgage paper to Goldman Sachs, this act requires the government to buy it -- essentially forcing America to bail out foreign investors.

The proposal lets the Secretary enter into contracts without regard to current legal restrictions. So much for competitive bids. It will be a return to $400 toilet seats.

Libertarians aren’t angry about the cost of this proposal. No, we’re angry that even one penny of taxpayer money is being used. The figure you are hearing in the news, $700-Billion-with-a-B, demonstrates the carelessness of the media. Under the proposal, the Secretary’s authority “shall be limited to $700-Billion at any one time.” No limit on how many transactions in a day, just at one time. The potential price tag on this proposal is every single dollar in America.

This proposal will undermine the stability of the American financial system. Why?

Ø Because it guts our capitalist system. Why should anyone start a business when the government has given itself the power to take over entire industries?

Ø Because it destroys the Constitutional guarantee of the sanctity of private contracts. Why sign any contract when the government has given itself the power to override them?

Ø Because it puts every financial transaction in America under the dictatorial and arbitrary control of an unelected bureaucrat, the Secretary of the Treasury. So much for personal responsibility. So much for freedom.

Libertarian Presidential candidate Bob Barr says “President Bush should fire Treasury Secretary Henry Paulson. We need a Treasury Secretary who can be trusted with the keys t o the taxpayer vault. It is imperative for Congress to explicitly limit the authority of the Federal Reserve. The Fed was not created to take over parts of the U.S. economy. Its authority must be limited and its officials must be held accountable for their actions,” says Barr.

The Libertarian Party of Washington thanks you for acting on this alert. Our economic freedom, our personal liberty, and our libertarian way of life are at stake!

Other things you can do:

VOTE LIBERTARIAN on November 4th, and contribute to our candidates’ campaigns.

Thanks for everything you do for Liberty!

* Copy of the proposal in the WSJ:
http://blogs.wsj.com/economics/2008/09/20/treasurys-financial-bailout-proposal-to-congress/