J. Max Wilson
A twenty dollar take on big government
By J. Max Wilson
First of all, take out a $20 bill and take a good look at the picture of President Andrew Jackson on the obverse side. Once you’ve stopped snickering about his wild hair, let’s review a little of the history of this controversial president, and then I’ll tell you what it can teach us about how to remedy our bloated and burdensome government.
In 1791, the U.S. Congress chartered the First Bank of the United States, and the bill was signed by President George Washington. The First Bank was chartered for 20 years, and in 1811, when the charter expired, Congress declined to renew it by just one vote. The First Bank ceased to exist. Then in 1816, Congress changed its mind and chartered a Second Bank of the United States, which was signed into existence by President James Madison (who had opposed the establishment of the First Bank, but changed his mind in the intervening years). The Second Bank was chartered for another 20 years.
The charter for the Second Bank of the United States expired in 1836, and Congress approved the renewal of the charter. President Andrew Jackson, however, felt that — despite a Supreme Court decision to the contrary — central banking was unconstitutional. He vetoed the bill that would have renewed the Second Bank, and it ceased to exist. It is ironic that Jackson’s image now adorns the face of the $20 bill under the modern incarnation of the national bank: the Federal Reserve.
Now, I am not interested in arguing about Centralized Banking, International Banker Conspiracies, or Jackson’s role in increasing the power of the presidency. I am interested, however, in what the history of national banks and Jackson’s refusal to renew the charter can teach us about how to fix our unwieldy federal government. While the drama and political controversies are interesting, the most important aspect of Jackson’s murder of the Second Bank is so utterly obvious and uncontroversial that it is easy to overlook. The important thing to note is that the charters for both the First and Second Banks contained what is often called a “sunset clause.” They included their own expiration dates. After a twenty year period, the bank charters had to be renewed by the currently elected government or they would cease to exist.
Today, the federal government is mired in bureaucratic auxiliary organizations. We have the CIA, the FBI, the IRS, the DOJ, the DOD, DEA, FDA, FCC, HUD, the Federal Reserve, and more. The Bush administration has now added the Department of Homeland Security. While I am not arguing for or against any specific auxiliary organization, many of them were added to the government before I was eligible to vote or before I was born. They are part of the government, and there is nothing I can do about it now. I do not think that such auxiliary organizations are unconstitutional; the government needs to be able to exercise its constitutional powers, and that may require such organizations to be created. The Department of Homeland Security is an excellent example. At the moment, it is arguably necessary. But what about twenty or thirty years down the road? What if our children or grandchildren find it inefficient, intrusive, or oppressive? How are they to remove it from the government?
My suggestion is that we amend the Constitution to require all auxiliary organizations such as the FBI, CIA, IRS, Federal Reserve, and even the Department of Defense and traditional cabinet positions to include a sunset clause or expiration date and that the expiration be no more than 35 years in the future. As its expiration date nears, each organization would have to justify its existence, its current organization and function, and its methods of fulfilling that function to the current people and elected government of the United States in order to renew its charter. Unless actively supported, government deadweight would automatically expire.
Sunset clauses might also be considered for involvement in international organizations and treaties, such as NATO and the United Nations. Unless participation or memberships were actively renewed, they would automatically expire on a given date.
The Founders were wise enough to include a sunset clause when establishing a national bank. They knew that just because it seemed to be a prudent action at the time, this did not mean that twenty years later it would prove to be so. They wanted to be sure that the created entity would only continue to exist if the people supported it. We should be as wise.
Now, thank Mr. Jackson for the lesson, and put your $20 bill away before the IRS sees it.
© J. Max Wilson
First of all, take out a $20 bill and take a good look at the picture of President Andrew Jackson on the obverse side. Once you’ve stopped snickering about his wild hair, let’s review a little of the history of this controversial president, and then I’ll tell you what it can teach us about how to remedy our bloated and burdensome government.
In 1791, the U.S. Congress chartered the First Bank of the United States, and the bill was signed by President George Washington. The First Bank was chartered for 20 years, and in 1811, when the charter expired, Congress declined to renew it by just one vote. The First Bank ceased to exist. Then in 1816, Congress changed its mind and chartered a Second Bank of the United States, which was signed into existence by President James Madison (who had opposed the establishment of the First Bank, but changed his mind in the intervening years). The Second Bank was chartered for another 20 years.
The charter for the Second Bank of the United States expired in 1836, and Congress approved the renewal of the charter. President Andrew Jackson, however, felt that — despite a Supreme Court decision to the contrary — central banking was unconstitutional. He vetoed the bill that would have renewed the Second Bank, and it ceased to exist. It is ironic that Jackson’s image now adorns the face of the $20 bill under the modern incarnation of the national bank: the Federal Reserve.
Now, I am not interested in arguing about Centralized Banking, International Banker Conspiracies, or Jackson’s role in increasing the power of the presidency. I am interested, however, in what the history of national banks and Jackson’s refusal to renew the charter can teach us about how to fix our unwieldy federal government. While the drama and political controversies are interesting, the most important aspect of Jackson’s murder of the Second Bank is so utterly obvious and uncontroversial that it is easy to overlook. The important thing to note is that the charters for both the First and Second Banks contained what is often called a “sunset clause.” They included their own expiration dates. After a twenty year period, the bank charters had to be renewed by the currently elected government or they would cease to exist.
Today, the federal government is mired in bureaucratic auxiliary organizations. We have the CIA, the FBI, the IRS, the DOJ, the DOD, DEA, FDA, FCC, HUD, the Federal Reserve, and more. The Bush administration has now added the Department of Homeland Security. While I am not arguing for or against any specific auxiliary organization, many of them were added to the government before I was eligible to vote or before I was born. They are part of the government, and there is nothing I can do about it now. I do not think that such auxiliary organizations are unconstitutional; the government needs to be able to exercise its constitutional powers, and that may require such organizations to be created. The Department of Homeland Security is an excellent example. At the moment, it is arguably necessary. But what about twenty or thirty years down the road? What if our children or grandchildren find it inefficient, intrusive, or oppressive? How are they to remove it from the government?
My suggestion is that we amend the Constitution to require all auxiliary organizations such as the FBI, CIA, IRS, Federal Reserve, and even the Department of Defense and traditional cabinet positions to include a sunset clause or expiration date and that the expiration be no more than 35 years in the future. As its expiration date nears, each organization would have to justify its existence, its current organization and function, and its methods of fulfilling that function to the current people and elected government of the United States in order to renew its charter. Unless actively supported, government deadweight would automatically expire.
Sunset clauses might also be considered for involvement in international organizations and treaties, such as NATO and the United Nations. Unless participation or memberships were actively renewed, they would automatically expire on a given date.
The Founders were wise enough to include a sunset clause when establishing a national bank. They knew that just because it seemed to be a prudent action at the time, this did not mean that twenty years later it would prove to be so. They wanted to be sure that the created entity would only continue to exist if the people supported it. We should be as wise.
Now, thank Mr. Jackson for the lesson, and put your $20 bill away before the IRS sees it.
© J. Max Wilson
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