Restor­ing the rule of law

The gov­ern­ment must live within the rules it im­poses on ev­ery­one

The Washington Times Weekly - - Front Page - By Richard W. Rahn

Last week, the Obama Jus­tice Depart­ment de­clined to press charges against for­mer In­ter­nal Rev­enue Ser­vice of­fi­cial Lois Lerner — even though there was over­whelm­ing ev­i­dence that she had tar­geted con­ser­va­tive groups and may have been com­plicit in destroying her emails. She also waived her Fifth Amend­ment priv­i­lege by pro­claim­ing her in­no­cence be­fore a con­gres­sional com­mit­tee and then re­fused to an­swer ques­tions. It is pos­si­ble that for some un­known rea­son Ms. Lerner’s case should have been dropped, but to many it ap­peared that once again Pres­i­dent Obama and At­tor­ney Gen­eral Eric Holder were ap­ply­ing the rule of law se­lec­tively.

Con­ceal­ing in­for­ma­tion from Congress is con­sid­ered a ma­jor of­fense, pun­ish­able by fines and sig­nif­i­cant jail time. The ev­i­dence seems to be over­whelm­ing that some in the IRS and the Depart­ment of Jus­tice have con­cealed in­for­ma­tion from Congress. In fact, Mr. Holder was cited for contempt of Congress for with­hold­ing in­for­ma­tion. The rule of law breaks down when those charged with en­forc­ing the law are, in fact, vi­o­la­tors of it.

We now know that for­mer Sec­re­tary of State Hil­lary Rod­ham Clin­ton with­held at least some of her emails from Congress de­spite pledg­ing full co­op­er­a­tion back in 2012 re­gard­ing the Benghazi dis­as­ter, and she failed to use U.S. gov­ern­ment email servers as she was re­quired to do. Again, th­ese are se­ri­ous crimes that some­one less in­flu­en­tial than Mrs. Clin­ton might well go to jail for — yet she most likely will be given a pass. Mr. Obama has taken many ac­tions con­trary to the rule of law. One can go on the In­ter­net to ob­tain long lists of th­ese al­leged vi­o­la­tions, many of which are now be­ing lit­i­gated. One of the cases that the courts have al­ready set­tled was Mr. Obama’s out­ra­geous claim that he, not Congress, would de­cide when it was in ses­sion. By mak­ing the false claim that Congress was not in ses­sion, he im­prop­erly made “re­cess” ap­point­ments to the Na­tional La­bor Re­la­tions Board and oth­ers, which the courts then reversed, along with de­ci­sions made by the board when it was com­posed of il­le­gal mem­bers.

Sus­tained eco­nomic progress is near im­pos­si­ble with­out the rule of law. His­tor­i­cally, peo­ple have been gov­erned by ar­bi­trary de­ci­sions of rulers or by laws that are read­ily un­der­stood, equally ap­pli­ca­ble to all (in­clud­ing the law­mak­ers), and only changed by a for­mal and open process. The con­cept of the rule of law goes back at least to an­cient Greece. In Eng­land, the Magna Carta (1215 A.D.), es­tab­lished that the rule of law was su­pe­rior to that of “di­vine right of kings.” It is no co­in­ci­dence that the industrial revo­lu­tion and mod­ern com­merce de­vel­oped first in the Nether­lands and Eng­land, both of which were gov­erned by the rule of law rather than the ar­bi­trary de­ci­sions of a king or re­li­gious ruler. In or­der to pro­tect the rule of law, the Amer­i­can Founders ex­plic­itly de­signed a sys­tem to limit the power of the ex­ec­u­tive and even that of the leg­is­la­ture and the courts.

It is no sur­prise that those coun­tries in the world whose cit­i­zens en­joy the high­est per capita in­comes (with the ex­cep­tion of some petro-states) largely op­er­ate un­der the rule of law, par­tic­u­larly when it comes to eco­nomic is­sues, rather than the ar­bi­trary de­ci­sions of a dic­ta­tor.

The eco­nomic im­por­tance of the rule of law can be un­der­stood by look­ing at the highly pub­li­cized Ar­gen­tine gov­ern­ment bond de­fault in 2001. Ar­gentina sold more than $100 bil­lion of gov­ern­ment bonds in the years im­me­di­ately pre­ced­ing 2001 un­der New York law and us­ing New York fi­nan­cial in­sti­tu­tions. The rea­son it used New York rather than Ar­gen­tine law is that pur­chasers of the bonds had much more faith in the rule of law in New York than the rule of law in Ar­gentina. Thus, us­ing New York law, Ar­gentina could get a much bet­ter price for its bonds, sav­ing its tax­pay­ers many bil­lions of dol­lars. The Ar­gen­tine gov­ern­ment has been try­ing to re­nege on its prom­ise to use New York law but, for­tu­nately, the U.S. courts have not let them do so.

The rule of law has been un­der­mined in the United States by the fact that not all are treated equally. Politi­cians have in­creas­ingly ex­empted and de­clined to pros­e­cute them­selves and other gov­ern­ment em­ploy­ees for vi­o­la­tions of the law that ap­ply to the rest of us. One of the so­lu­tions would be to greatly ex­pand the right of pri­vate ac­tion against in­di­vid­ual gov­ern­ment em­ploy­ees and elected of­fi­cials when their ac­tions cause harm to in­di­vid­u­als or groups. Tea Party and other groups should be al­lowed to sue Ms. Lerner and other mis­cre­ants at the IRS, with­out the gov­ern­ment pro­tect­ing them un­der the doc­trine of sovereign im­mu­nity.

Fi­nally, the rule of law has been un­der­mined by the enor­mous in­crease in the num­ber of laws al­low­ing peo­ple in gov­ern­ment to tar­get al­most any­one. There are more than 4,600 fed­eral felonies now on the books, which many, if not most, cit­i­zens have un­know­ingly vi­o­lated be­cause many of th­ese laws defy com­mon sense. If the Ten Com­mand­ments were good enough for the Lord, than a limit of a hun­dred felonies ought to be good enough for the fed­eral gov­ern­ment.

Richard W. Rahn is a se­nior fel­low at the Cato In­sti­tute and chair­man of the In­sti­tute for Global Eco­nomic Growth.

IL­LUS­TRA­TION BY GREG GROESCH/THE WASH­ING­TON TIMES

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