2nd Constitution 21st Century Common Sense

8/3/2019 2nd Constitution 21st Century Common Sense

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We The People of the United StatesWe The People of the United States

in Order to form a more perfect Unionin Order to form a more perfect Union

Secure the Blessings of Liberty to ourselves and our PosteritySecure the Blessings of Liberty to ourselves and our Posterity

Estab

lishJusticeinsured

omesticTranquility

providefortheco

Estab

lishJusticeinsuredomesticTranquility

provideforthecommon

mmondefence

defence

Doorda

inandestablishthisCONSTITUTION

fortheUnitedSta

tes

Doorda

inandestablishthisCONSTITUTION

fortheUnitedStatesofAmerica

ofAmerica

The 21st Century and Common Sense:

A Path to A Second Constitutional Convention

Addressing The Looming Crises of the United States Economy and Party Politics

Through A Peoples Convention to Revise Its Most Sacred Document


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The 21st Century and Common Sense:

A Path to A Second Constitutional Convention

(Pictures: The Signing of The Constitution of The United States, National Geographic Society)

Addressing The Looming Crises of the United States Economy and

Party Politics Through A Peoples Convention to Revise Its Most

Sacred Document

Jason T. Powers

2011 Deep Center Field Press


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Table of Contents

PreamblePreamblePreamblePreamble

IIIIA Brief History of the U.S. Constitution and AmA Brief History of the U.S. Constitution and AmA Brief History of the U.S. Constitution and AmA Brief History of the U.S. Constitution and Amendmentsendmentsendmentsendments

2

IIIIIIII

The Urgent Problems in America TodayThe Urgent Problems in America TodayThe Urgent Problems in America TodayThe Urgent Problems in America Today

4

The Degradation of An American LifeThe Degradation of An American LifeThe Degradation of An American LifeThe Degradation of An American Life 4

A Once Healthy Life DeterioratingA Once Healthy Life DeterioratingA Once Healthy Life DeterioratingA Once Healthy Life Deteriorating 8

An Angry Sea of Debt and Unfair Trade WarsAn Angry Sea of Debt and Unfair Trade WarsAn Angry Sea of Debt and Unfair Trade WarsAn Angry Sea of Debt and Unfair Trade Wars 9

Not So Free TradeNot So Free TradeNot So Free TradeNot So Free Trade 15

Finance,Finance,Finance,Finance, Money, and The BanksMoney, and The BanksMoney, and The BanksMoney, and The Banks 17

Revisiting the PastRevisiting the PastRevisiting the PastRevisiting the Past 23

Rivals to Prosperity and FreedomRivals to Prosperity and FreedomRivals to Prosperity and FreedomRivals to Prosperity and Freedom 24

Natural Resources and Energy PolicyNatural Resources and Energy PolicyNatural Resources and Energy PolicyNatural Resources and Energy Policy 26

Wars AbroadWars AbroadWars AbroadWars Abroad 28

Internal Conflict and Course CorrectionInternal Conflict and Course CorrectionInternal Conflict and Course CorrectionInternal Conflict and Course Correction 30


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Table of Contents

IIIIIIIIIIIIThe Founding Fathers and The Framers Action PThe Founding Fathers and The Framers Action PThe Founding Fathers and The Framers Action PThe Founding Fathers and The Framers Action Planlanlanlan

30

VisionariesVisionariesVisionariesVisionaries 30

IVIVIVIVThe Proposed Solution: A Constitutional ConventionThe Proposed Solution: A Constitutional ConventionThe Proposed Solution: A Constitutional ConventionThe Proposed Solution: A Constitutional Convention

31

BaitBaitBaitBait nnnn Switch and The MediaSwitch and The MediaSwitch and The MediaSwitch and The Media 31

The Common Mans PlaceThe Common Mans PlaceThe Common Mans PlaceThe Common Mans Place 33

VVVVInitial Debate, Structure of Convention, Delegates, Support &Initial Debate, Structure of Convention, Delegates, Support &Initial Debate, Structure of Convention, Delegates, Support &Initial Debate, Structure of Convention, Delegates, Support &

Sample of Proposed ConstSample of Proposed ConstSample of Proposed ConstSample of Proposed Constitutional Amendmentsitutional Amendmentsitutional Amendmentsitutional Amendments

34

AmendmentsAmendmentsAmendmentsAmendments 34

DelegatesDelegatesDelegatesDelegates 37

Elder StatesmenElder StatesmenElder StatesmenElder Statesmen 39

CommitteesCommitteesCommitteesCommittees 40


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Support from Other Branches of GovernmentSupport from Other Branches of GovernmentSupport from Other Branches of GovernmentSupport from Other Branches of Government 40

Delegates Role, Responsibility and Venue for ConventionDelegates Role, Responsibility and Venue for ConventionDelegates Role, Responsibility and Venue for ConventionDelegates Role, Responsibility and Venue for Convention

A Sample of 21A Sample of 21A Sample of 21A Sample of 21stststst Century AmendmeCentury AmendmeCentury AmendmeCentury Amendments for Discussionnts for Discussionnts for Discussionnts for Discussion 41

A 4A 4A 4A 4thththth Branch to Constitution: The Councilor BranchBranch to Constitution: The Councilor BranchBranch to Constitution: The Councilor BranchBranch to Constitution: The Councilor Branch 41

VIVIVIVIConcluding Thought on Americas ProblemsConcluding Thought on Americas ProblemsConcluding Thought on Americas ProblemsConcluding Thought on Americas Problems

45

Bibliography & AppendixBibliography & AppendixBibliography & AppendixBibliography & Appendix

48 49


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PreamblePreamblePreamblePreamble

During the Course of human events, it has been necessary to reexamine

the foundations of Governance, and to measure the plights and ploys of

the powerful, and their lauded places, to those they rule via The Law.

This exists whether they be: democratic, monarchial, or theocratic in

design, or other purposes, less distinguished, and often, more

distressing. What they all have in common is: the People under their rule.

To see what ends work, and which ideas will endure, the People must

self-determine, at some fortuitous point, whether they will comply and

concede to the idea of any such rule, or whether a new path is to be

hewn from the rock of Freedom; and what necessary part will the People

play as its rock Shaper.

Even the oldest of Kingdoms and Democracies alike must relent to

reasoned looks at new ideas of law and reordering of economic plights.

To see when the faltering is near; even while their may be legitimate

efforts to stop the wheel of fate from crushing the hearts and minds of

the People, some efforts are better left to the auspices of an entire

Nation, than the Will of long entrenched rulers, whether they be King, or

Senator, in operation.

This task is not without risks or jeopardy to the way of those it will most

affect. Stability is a staple to be desired and preserved at a jealous

price. But such stable avenues mean little if they no longer exist;

corrupted by decay, decadence, and vice; handle ineffectively the

changing landscapes before them; and are futile to the majority that can

make better roads and realities for All when they listen to All via vibrant

Compacts and Constitutions.

Such is the present state of the United States of America once founded

on the principles of Equality, Liberty, and Prosperity. These ideals were

fired tested for two centuries and one score through war and strife and

pioneering treks. And while a Nation is not without its ebbs and natural

resurrection from dire affairs, the answers to such perils all came with

great change. Sometimes only to an issue that created a noxious divide

and others as they threatened the permanent schism for which a

rejoining shall be impossible to achieve.


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It is to ponder what can be achieved if the noble notions again of

Equality, Liberty, and Prosperity hold steadfast in the present tense.

And up to the People to put to task the forthright effort to achieve again

what The Founders fought vigorously for and designed adeptly to keep

safe and sacred: A Nation United against all Foes, Foreign and Domestic.

I. A Brief HisI. A Brief HisI. A Brief HisI. A Brief History of the U.S. Constitution and Amendmentstory of the U.S. Constitution and Amendmentstory of the U.S. Constitution and Amendmentstory of the U.S. Constitution and Amendments

In the summer of 1787, a prestigious group of men, whose fame and

foresight and fighting instincts brought forth a nation for and of the

Common Man, sat in Philadelphia to hammer out the Ten Commandments

of the United States of America, the U.S. Constitution. Theirs was a

seemingly insurmountable task; to draw upon the successes of previous

empires while avoiding the misdeeds of those same nation-states, given,

that many who fomented and espoused ideals of Equality and Freedom,

often could not live up to their own stated designs in their own personal

actions and deeds.

As is always the case, the men involved became heated on particular

subject matters, and the division of powers to be held by the fledgling

government. Compromises were made; and future questions of the State

were left to be Amended.

Meanwhile, after such a beautiful design, John Jay, James Madison, and

Alexander Hamilton carried further those discussions of what these

Framers had designed at the Constitutional Convention, via the

newspapers of America in The Federalist Papers as all States were

asked to adopt and ratify this Earth-shaking document.

It will soon be 225 years since this monumental task was engaged in

to form a more perfect Union, establish Justice, insure domestic

Tranquility, provide for the common defence, promote the general

Welfare, and secure the Blessing of Liberty to ourselves and our

Posterity (Preamble to the United States Constitution.)

At many junctures in our nations history, we have corrected course via

internal and external threats to our nations Posterity. Seven-five years


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after New Hampshire was the ninth state to ratify the Law of the Land

(June 21, 1788), the Civil War raged on. The bloody battle at Gettysburg

set the stage for Abraham Lincoln to speak to the existence of our

Union: The world will little note, nor long remember what we say here,

but it can never forget what they did here. It is for us the living, rather, to

be dedicated here to the unfinished work [for] which they fought

(Gettysburg Address, November 19, 1863.)

With the outcome of the Civil War, the 13th, 14th, and 15th Amendments

were amended to the Constitution to firmly establish the Rights of

African-American citizens. Yet, this battle was hardly won: as our History

has proven in the years of racial turmoil that raged on thereafter.

Again, seven-five seasons of time would pass before we faced another

threat on the horizon: the inauspicious regime of Nazi Germany and its

satellites. The next turn of the calendar the Axis launched World War II

and the forces of Freedom were pitied against this powerful, unrelenting

drive of a deranged enemy to rule, unasked, all those not considered

Equal.

But the United States of America, again, had an Insurmountable Might;

and an Indomitable Will.

Late in the war, President Franklin Roosevelt said in 1944: True

individual Freedom cannot exist without economic security and

independence. People who are hungry and out of a job are the stuff of

which dictatorships are made. (Address to a Joint Session of Congress.)

After Roosevelts death in April 1945, the 22nd Amendment was ratified in

1951. This amendment limited the election to the office of President to

two elections and no more than 10 years total in office. It was felt by his

opponents that Roosevelts four elected terms had installed too much

permanency; and dangers lied in prolonged rule by one political party, or

leader.


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II. The Urgent Problems in America TodayII. The Urgent Problems in America TodayII. The Urgent Problems in America TodayII. The Urgent Problems in America Today

Now, as we move into the fourth act of our nations illustrious history,

we face threats across many fronts internal and external that must be

addressed immediately.

In the past quarter century, much of what America has become is being

done without a rudder, leadership, or the ruling spirit of a guiding hand.

The President of the United States, Barack Obama, spoke to this

dilemma during a 2009 White House news conference, saying that

America was similar to a gigantic ship that is not, easily course

corrected, and that it responds, slowly to the policies installed. U.S.

Court of Appeals judge Richard A. Posner inA Failure of Capitalism used

yet another ship analogy: that of a capsized ship being very difficult to

rock back from its Poseidon dwelling once upended by an economic tidal

wave. These sea and tsunami metaphors do not end there with regard to

this American Crisis. A Perfect Storm, A Financial Hurricane, A Tsunami

of Debt, A Frozen Sea of Credit, all flooded the front pages of the

newspapers at the outset of the Great Recession. Unfortunately, it took

such sea metaphors to awaken the sleeping captains of households and

companies alike to the dangers lurking in the deep global sea of

economics and finance.

Section ISection ISection ISection I. The Degradation of An American LifeThe Degradation of An American LifeThe Degradation of An American LifeThe Degradation of An American Life. The recent financial

collapses of 2007-2010 left Americans trillions of dollars poorer. Two of

the largest and most venerable manufacturing companies, GM and

Chrysler, were put in the process of bankruptcy; 1000s of small and

medium businesses saw their doors shut permanently; and any job suits

if one is looking for a place to make poverty line work count.

As Americans went into the ranks of the unemployed for prolonged

stays, the psychological toll was reminiscent of stories painted in Studs

Terkels Hard Times. Internal blaming phrases like: Im dying

offstaying up too late and sleeping too longstaring at the computer

screen, the window, your mirrored imagewith suicidal thoughts. I feel

so behindperhaps [you] are just not good enough. I feel worthless. I

feel like Im pulling my family into a hole with me.1

1 Zachary Roth. The Lookout. Yahoo! News Blog: July 14, 2011.


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The present day is about survival by nearly any means. And trying to see

positives where very little of them exist. But the story of a decaying

feeling and the eroding nation itself started long ago.

The sobering statistics of the past thirty years reflects most Americans

work longer hours; for a shrinking piece of the American Dream; while

consistently leveraging their futures on the consumption of present day

disposable, even if durable, consumer goods. Personal savings (if any

existed) were sunk into bigger homes and investment bubbles that

popped to only reinforce these economic stressors faced by Americans

from coast to coast. A strong middle class America existed only in the

far off memories of the past; and such looks remind us of the reasons we

often struggle today: income stagnation and Globalization.

From 1973 to 2006, the U.S. economy tripled in size in terms of its GDP.

1973 personal income (adjusted to 2007 dollars) of the bottom 90% was

$32,135. But by 2006, ones pay was cut to $31, 528. The top 10% saw

their paychecks double from $138,738 to $276,140 during the same

period.2 Meanwhile, the gap between the ber-rich and the middle class

is no longer just a zero or two, but a clutch of zeros in one hand, often

used to exploit an ever-hastening Global Game. To quote President

Obama again, In 1980 the average CEO made forty-two times what an

average hourly worker took home. By 2005, the ratio was 262 to 1.

Conservative outlets like TheWall Street Journaleditorial page try to

justify outlandish salaries and stock options as necessary to attract top

talent, and suggest that the economy actually performs better when

Americas corporate leaders are fat and happy. But the explosion in CEO

pay has little to do with improved performance.3 Yet, the case was

made happily for this global shift of wealth from lower to upper class and

from America to outside its borders.

The argument for Globalizations benefits depends entirely on where one

is; how old one is; what industry one inhabits; and the transformational

urges one can uniquely accomplish in a quickening and unstable world.

During the past sixty-five years, the United States has put together

several economic reclamation projects, some as massive as China,

2 Joshua Holland. The Fifteen Biggest Lies About the Economy.3 Barack Obama. The Audacity of Hope.


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others as small as the Israeli state. These projects pumped trillions into

the war torn, the nascent, and the communist realms with the hope

democratic ideals, open markets, and trading partners would come

about using this economic strategy. Industries rebounded in Japan and

Germany post war. Central and South America saw interventions by the

U.S. to stave off state disintegration. Europe was buttressed from an Iron

Curtain falling. Southeast Asia reflected the best and the worst of this

strategy. Often, the greater good was served as allies were remade and

reborn. However, at some point, the ideal of improving weaker states

lost sight of homeland realities, and the capitalist giver became the one

in restructuring need and necessity.

Tied to this march of globalization and forming trading partners via

exporting industries deem to labor costly and unworthy of reinvention at

home, a population grows mature in America. These older citizens must

hold on to hopes of rebounds in the stock market in the funds and

companies they invested in; the solvency of Social Security remains

Sacrosanct; and the Youth can create the next boom (read: growth) in

America and find employment and contribute forthwith to Social

Security. Such is the dice roll for millions of people over age 55: the

ultimate leveraged pyramid of money that must remain solvent for them

to partake.

Many of these Elderly have pushed off retirement, usually not by choice

thus putting additional strain on the employment market, geared

primarily to technology and the youth and consequently, the job hunt is

more competitive (and for less pay) than ever. Industries once trained

for are now: offshored, outsourced, redistributed, or outmoded. If one is

without savings or a solid nest egg, going back to school to quickly

acquire skills forthe possibility of a job and not an assured career for a

decade, or more, is a risky, debt-laden proposition. (Not to discount the

ageism too of hiring employers are not looking for near retirement

employees at a premium health and salary cost they may desire, or

require. Part-time or consulting work is a more likely option for persons

over 55.)

But this is not the American Dream sold to the sons and daughters of the

Greatest Generation. It is a nightmare; a physical and psychological

burden to work well beyond sixty-five, to seventy or seventy-two, hoping


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and praying a pink slip does not appear, or ones health, does not fall into

sudden and catastrophic disrepair. Not all are in crisis, but the fear is

indeed real enough.

These further workplace trends are indeed happening worldwide. As laid

out in the 2010 book, The 2020 Workplace: How Innovative Companies

Attract, Develop, and Keep Tomorrows Employees Today, five

generations (Traditional, Boomer, Gen X, Millennial, and Gen 2020) will

be in intense competition for a share of the knowledge economy, loosely

defined as tacit careers versus the 20th century transactional jobs. These

tacit jobs involve increasingly more mental diversification quantitative

analysis and judgment, social media skills, massive data collections and

transfers, collaborating long distance and a coherent worldview

understanding and ones place in it whereas, transactional holds to the

dominate 20th century model of assembly line interaction, passing the

widget, with minimal interaction and regulated collaboration held in just

the top tiers of the company.

But this change of skill sets has reached a tipping point. Since the late

1990s, over two-thirds of jobs created in the United States have been the

tacit jobs. Which sounds encouraging until it is realized that the

replacement jobs are far, far less numerous4 than the total U.S.

employment pool and the remaining pool of job applicants lack the

necessary skills to take on this growing complexity of a tacit job. (As the

pace of technology follows Moores Law: half smaller and twice quick

technology is around the corner in a mere eighteen months. And the less

adaptable people are left further behind unless they resolve to keep up

ormake the quantum leap ahead.)

Additionally, the Globalization factor has turned the Fortune 500

companies over substantially in since 1980, as other countries are

indeed surpassing the United States in all avenues of talent creation,

company innovation, and attractive salaries or just importing in the

U.S. corporations willing to forego human rights concerns, on the hunt

for cheap labor, and lax (no) tax regimes. While there are obvious

benefits for the host country, and their economy, the United States loses

4 Paul Wiseman. A Boom in Corporate ProfitsAssociated Press; July 23, 2011. 2.4 million jobs transferred to foreignlands with 2.9 million lost in America according to U.S. Commerce Department. Wages stagnate during 2009-2011recovery, accounting for only 1% of economic gain as compared to 50% in the 1991-1992 recession.


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out. (Whitecollar jobs legal and financial sectors have migrated to

English-speaking India. Soon, the $3,000 tailor-made suit club will feel

the real pains of outsourcing and recession, and change their tunes on

this trend too. Or as Ben Stein, former Nixon speechwriter lately noted:

When recessions happened, they happened to people in Ohio or Illinois

or Michigan. Now, they have hit hard in California and in the law field

where so many of my friends work and in Washington5) Arguments

again to what caused this can be bantered around, but what to do about

it is the more salient question to be answered. Massive and decisive

change will be at the heart of the approach if this nation is to own its

problems and forge a solution.

21st century Globalization expert Thomas L. Friedman put it this way:

The crisis is already hereThe flattening of the world is moving ahead

apace, and barring war or some catastrophic terrorist event, nothing is

going to stop it. But what can happen is a decline in our standard of

living, if Americans are not empowered and educated to participate in a

world where all the knowledge centers are being connected.6

Such declines predated the Great Recession, only the mildly ignorant, or

naively political, refused to see the movements of capital outflow,

savings lost, deteriorating infrastructure, staples costing much more,

and Americans growing ire at all things, rationally and irrationally tied to

this failing reality. Our connectedness to a sinking ship was all too

apparent. And everyone is looking for an oar, or better yet: safe harbor.

Section IISection IISection IISection II. A Once Healthy Life DeterioratingA Once Healthy Life DeterioratingA Once Healthy Life DeterioratingA Once Healthy Life Deteriorating. Tied to this loss of the

American Dream is the American Health Care system continues to

escalate in cost, while nearly 20% cannot afford or lack adequate

coverage. By 2017, nearly one in five dollars in GDP (Gross Domestic

Product) will be spent on the systems maintenance as the Boomer

Generation (1946-1964) expands costs via their health conditions

deteriorating. (SourceSourceSourceSource: NPR, 2008.) Add to that, the conditions of people

under 35: obesity rates are climbing; type II diabetes is a national

epidemic; and the uninsured weighing the system down, often with no

5 Ben Stein.The End of Wishful Thinking. The American Spectator. July 19,2010.6 Thomas L. Friedman. The World is Flat.


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financial ability to purchase complex insurance plans or fall under the

pre-existing conditions category that makes it a nearly hopeless fight.

A measure was passed into law in 2010 to provide universal health care,

termed ObamaCare, yet no one seems to have an adequate handle on

the costs, the application, or the allowances to be made to and from

many parties involved (doctors, insurers, patients, hospitals,

pharmaceuticals, etc). The Law currently faces legal challenges around

the country, (state by state), adding to the confusion and costs to be

shouldered going forward. Repeal of ObamaCare will only add chaos to

the economic malaise yet to be righted from its Neptunian depths.

Yet getting persons who ideological gulfs are wider that the Pacific

Ocean to agree on health care that of who is responsible (individualism

vs. collectivism), what government role is applicable (private hospitals

or a public system), why such insurance gaps (the worst off are the least

likely to get covered), or how to prescribe the medicines (preventative,

maintenance, natural, outsourced, foreign) assures any compromise is

seen as utter defeat. A scorch earth mentality is employed often on this

topic. With trillions at stake, no side is ever going to agree. And an

election looms large in 2012 to repeal or reinforce ObamaCare.

Section IIISection IIISection IIISection III. An Angry SAn Angry SAn Angry SAn Angry Sea of Debt and Unfair Trade Warsea of Debt and Unfair Trade Warsea of Debt and Unfair Trade Warsea of Debt and Unfair Trade Wars. Our National

Debt has surpassed $14.3 Trillion dollars. For a sobering example, if our

Government would save $1 Billion per day, every day, it would take 38

years and 330 days to eliminate the balance. However, if interest

accrues at the same rate dailyon that $14 Trillion, the net effort would

be a zero change to our Debt. (This interest payment will be the usual

case by 2012: $383 Billion in interest outlays are projected inA New Era

of Responsibility: Renewing Americas Promise, 2009, Office of

Management and Budget, www.budget.gov, pg. 125.)

Table 1. U.S. Government Debt

U.S. Government Debt In Billions

National Debt (April 2011) 14,200

Projected ND Interest (2.5%) 355

2011 Deficit Estimate 1,100

De Projected Interest (2.5%) 27.5

National Debt (April 2012) 15,682.5

Interest Payments 382.5


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Additionally, at least $55 Trillion in Debt chokes America from

households to the states to private debts of corporations. These debts

will continue to exist for a lifetime, or more. As it will take much more

responsibility than seen in many a budgetary programs currently devised

and executed across the spectrum of politics or policy. By 2014, this

egregious total could well eclipse $87 Trillion. (Kevin Phillips, Bad

Money.)

Much of the yearly federal deficit can be tied to taxation shortfalls.

Where in the 1950s one in fourtax dollars came from corporations, the

present sees only one in ten federal receipts coming directly from the

business sector. Corporate profits have risen dramatically and have

federal subsidies piggybacked into the mix specifically in the energy7,

food, and utility sectors; capital gains taxes are low; inheritance taxes

(as most wealthy people know) are easily avoided via trusts and

foundations; individual tax cuts from 2001 forward for the toptier

earners (and coinciding war machinates) has left the federal budget

groaning perpetually from debt and interest payments. It would be

tolerable if only one or two of these situation existed capital gains and

inheritance, for example but to have all of these in operation while the

United States spirals into insolvency, leaves one to wonder why policy

has not altered much in the last decade.

This Long-Term Debt Crisis was only acerbated by the prolonged Great

Recession, which required even more deficit spending to spur growth, as

$787 Billion in outlays were approved in February 2009 on top of $700

Billion doled out to Wall Street in the fall of 2008 to keep the Capitalistic

System functioning, albeit in tatters. The Federal Reserve too made

numerous credit facilities available to spur lending on buying collateral

from these ailing banks which ballooned its balance sheet from $900

7

In May 2011, this issue of subsidizing came to an oil head as the century-old sisters of the Standard Oil trust (1907)came before a congressional committee to argue for keeping $21 billion in subsidies over a decade while they areracking up the largest profits of any company in America today. Subsidies for nascent industries are not an unusualcourse for most countries in the world. Most governments attempt to support any new innovation where possible.However, oil has long been a mature industry and has pocketed these billions for the most part, reinvesting little.Shifting these subsidies to the termed green economy would at least be a defensible course of action and just mightcreate competition the oil companies fear is inevitably coming. (The subsidies were left in place in spite of loudarguments made about debt ceilings and defaulting on debt. Meanwhile, billion dollar ethanol subsidies for defendingcorn ethanol, a substantially weaker product compared to Brazilian sugar cane ethanol, was to be scrapped. Othermethods, involving cellulose-based or garbage-infused ethanol are still in their infancy, and are being ignored (lacksufficient subsidies) as alternatives. Again reflecting a total disregarding of a major concern: energy independency.)


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Billion in 2007 to $2.4 Trillion by summer 2009.8 All this was meant to

replace a multi-trillion dollar hole blown into the 21st century quicksand

foundation of the American Economy: homebuilding and consumerism.

The revitalization and recovery of jobs lost has been slow, if

meaningfully positive, since losing 750,000 in January 2009 alone, and

eight million over the course of the last days of Bush administration and

the first 100 days of Obamas term. Yet, as we averted that spiraling

crisis (for the present) a rationale is needed to maintain Fiscal

Responsibility in the decades to come. (Debts do matter contrary to

economists drinking too liberally the free market punch of the 1980s.)

Else, We will see unimaginable debt loads, and harder economic choices,

than has befallen any generation(s) of Americans before.

Seemingly deaf to the magnitude of the problem, politicians on both

sides of the spectrum refuse any pragmatic and innovative ideas to solve

the debt crisis. Progressives (or Democrats) work often for research-

depleting military cuts, tax hikes on the wealthy, quasi health care

reform, and energy independency as a way to make reductions, with

scarcely a thought on certain waste in the government safety net and

social platforms. Not to be outdone, Conservatives (or Republicans) see

any FDR and LBJ entitlements as their bane to be axed away; the

wealthy person tax cut as the cure all to growth in the economy, and (by

extension via the Laffer curve), increased tax revenues; and free market

(lax regulations) as the hallmark of a countrys wealth and prosperity

engine, ignoring obvious social costs generated at a private beneficiarys

faux obliviousness. Libertarians (to match) would do away with all

governance (except local), keep a strong international military (in

theory) and put the country back on some form of a gold standard or

basket of trinkets to measure economic value. Other extremists have

their pet projects and one-bullet cure alls. These oft-deranged and

haughty moralistic battles leave the economy and government in a state

of a never-ending tennis match as the ball goes back and forth across

the net of public opinion. Endless love it is not.

This battle heated up to a broil in the summer of 2011 as the debt

ceiling was reached. For years on end, no mention of a debt ceiling was

8 Nouriel Roubini and Stephen Mihm. Crisis Economics.


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ever broached. And it was an automatic that it would be raised during

the authors two-score life. Now, it is tied to a range of talks that

included much of the prior analysis: no tax increases (Republicans), cuts

in social programs (Obama), and does not matter (Libertarians and

quacks.)

Even talk of a constitutional amendment (imagine) to balance the budget

has moved through the House of Representatives, but is assured to fail

in the Senate. The timing of these useful long-term talks is poisoned by

short-term necessities as the deadline looms as of this writing: August 2,

2011.

The inevitable result of such inaction or ignorance or haphazard

constitutional amendments: Interest rates will rise precipitously; Dollars

applied to Social Security, Medicare/Medicaid, Interest Payments and

Military Spending once assured to remain large, and quite permanent,

now could be at jeopardy. Meanwhile, the remaining Social Safety Net

will shrink accordingly, because: we will refuse to tackle those other big

dollar issues with any logic. The needed investments of Government will

be deferred, decimated, or completely ignored; Private Capital will seek

shelter elsewhere abroad in booming markets, like Brazil, Russia, India,

or China and Our National Assets will be sold (privatized) to the most

forceful owner of our Trillions in Debts; and the United States standard

of living will indeed become a shadow of a once great and proud nation.

Debt will consume us if we refuse to swallow our medicine, sacrifice

(at all levels of wealth), and make hard choices like all do in their lives.

Such shadows looming are all ready here. In late April 2011, the

International Monetary Fund (IMF) revised its projections on the sizes of

economies and their growth. It is foreseen that China, termed still an

emerging market, will surpass the United States in terms of GDP by as

early as 2016, given their nearly 10% yearly growth. (To measure just

how fast such a rise took place: In Power Rules, Leslie Gelb, posited:

For example, Chinas GDP was roughly half of Americas by 2008

estimates)

Chinas rapid ascent economically in the past thirty years is tied directly

to the widening trade deficit between its borders and the United States.


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13

Between 1978 and 2005, for example, the amount of goods traded grew

by a factor of over 400. (Chinas yearlyexports in 1978 were compressed

down to a dailyexport rate by the mid-2000s.)

Supporting Tables. Trade with China from 1985 to 2008

Source: U.S. Census: www.census.gov/foreign-trade/balance

Year Exports Imports Trade Deficit President

1985 3,855 3,861 -6 Reagan

1986 3,106 4,771 -1,665 Reagan

1987 3,497 6,293 -2,796 Reagan

1988 5,021 8,510 -3,489 Reagan

1989 5,755 11,989 -6,234 Bush I

1990 4,806 15,237 -10,431 Bush I

1991 6,278 18,969 -12,691 Bush I

1992 7,418 25,727 -18,309 Bush I

1993 8,762 31,539 -22,777 Clinton

1994 9,281 38,786 -29,505 Clinton1995 11,753 45,543 -33,790 Clinton

1996 11,992 51,512 -39,520 Clinton

1997 12,862 62,557 -49,695 Clinton

1998 14,241 71,168 -56,927 Clinton

1999 13,111 81,788 -68,677 Clinton

2000 16,185 100,018 -83,833 Clinton

2001 19,182 102,278 -83,096 Bush II

2002 22,127 125,192 -103,065 Bush II

2003 28,367 152,436 -124,069 Bush II

2004 34,744 196,682 -161,938 Bush II

2005 41,925 243,470 -201,545 Bush II2006 55,185 287,774 -232,589 Bush II

2007 65,236 321,442 -256,206 Bush II

2008 71,457 337,789 -266,332 Bush II

Total 476,146 2,345,331 -1,869,185

China

Overall TradeDeficit by

Pres.

President (Millions)

Reagan -7,956

Bush I -47,665

Clinton -384,724

Bush II -1,428,840

Even more telling is the power shift in the corporate headquarters of the

Financial Times Global 500 amongst the top economies of the world. In

2005, the United States held 219 corporate behemoths while China had

only 8 such corporate HQs. By just 2009, the decline to the U.S.

numbered 181, a 17% drop. Meanwhile, China quintupled its number to43, an enormous shift, and nearly, onetoone. Other countries on this

list made modest gains and losses, but this was the most distinct

change to the balance of power of the corporate world. (The 2020

Workplace, pg. 22.)


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14

Because of this persistent and growing trade deficit, China holds

considerably more than a $1 Trillion of our debt. Much of this problem

amassed just between 2005 and 2008, at the nexus of the financial

dooms day and the corporate reshuffle. While housing prices fell,

Americans borrowed more and more from China to maintain a stagnating

standard of living. Meanwhile, much closer allies, such as Canada,

Mexico, Japan, and Germany, also hold their fair share of Treasury Notes

in America. Luckily, the U.S. has diplomatic relationships with them on

much better terms, as none has made curious statements like China has.

Yet, Chinas remarkable economic activity has come without Democracy

or enhanced freedoms; rather, as United States Republicans or

Conservatives would compare it to the rise of Americas economic

primacy during the post-Civil War era withoutthe needof civil war. And

modern Democrats would liken it to laissez-faire polices run amok which

vigorously promoted outsourcing and transplantation of America

corporations to Chinas Eastern seaboard where inland Chinese migrated

happily to take a very low wage (2-10%) of any American worker.

That final statement includes the linchpin of the beginning of the end for

the U.S. economy: while we could get very lost cost goods electronics

for cheap, furnishings and clothes for little coin we did it while

printing money in hordes and exporting our now faltering manufacturing

and knowledge base, the backbone of the American Dream for decades,

away.

A Nation that makes tangible things and ideas controls its own destiny;

or as Benjamin Franklin once surmised: the riches of a country are to be

valued by the quantity of labor its inhabitants are able to purchase, and

not the quantity of silver and gold they possess. The United States has

squandered the advantage of the former labor and innovation at home

and monetized through masses of pulp and paper the latter. We allowed

the printing presses of Franklins trade to outstrip the labor we once had

in spades over the World while dispossessing our children of their

greatest Inheritance.

No greater example of this exists than the U.S. position at the climax of

World War II. The armada that laid in wait for a siege of Japan in the

closing moments of that war was made in the factories and shipyards


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15

and the Midwest stirrings of fields. It was unmatched in size, strength,

and mission. Yet, in an August month, named for a Roman Emperor, we

shook the Earth more than all the ships and planes at our disposal could

in a single bomb from a single plane. And Japan took note of that power

and spared millions the cruelty of further warring.

Their proud and industrious nation was not wrong in stopping the fight,

nor wrong in rebuilding with our help. It may have been the truest

measure of our nations strength: to put aside our rightful vengeance for

Pearl Harbor and to support the endeavors of the Rising Sun post-war.

Our own rise from the depths of the Great Depression to the benchmark

of a strong and vital Nation-Empire was in a mere blink of Human

History. Yet it happened. (See AppendixSee AppendixSee AppendixSee Appendix: 1945 U.S. Military Strength)

Japan, for its part, seeded in a fair amount of its auto industry in the

United States starting in the Reagan administration. Mainly as a

response to a then call for fair trade, and did so, without legacy costs

of union employee benefits that came to hamstring the Big Three

automotive. (Or more plausibly, the short sightedness with regards to

fuel efficiency and well-designed vehicles. An automotive argument for

another time.)

Section IV. Not So Free Trade.Section IV. Not So Free Trade.Section IV. Not So Free Trade.Section IV. Not So Free Trade. The United States has made itself the

ardent supporter of most economies since the end of WWII. Enlivening

the innovative spirit and spiriting democracy around the world were dual

objectives. The capitalism pillar rebuilt (West) Germany and Japan into

post-atomic friends. Successes in South Korea place that nation among

the most connected places on Earth with a strong manufacturing base.

Taiwan, again, has emerged as a vigorous nation-state. However,

failures in Vietnam (military), Central America (political) and the Middle

East (historical) doggedly pursue us. (The Middle East got billions in

financing and arms and tacit support of anti-Communist dictatorships.)

It is usual that failures greatly outshine the successes in Americas

remembrance, as loss is unacceptable; political bungling unpalatable;

and ideals distorted unconscionable.

China, too, became our pet project. Just since the turn of the 20 th

century, the battle to influence (or exploit or takeover) China has been

waged by many nations. Great Britain, Japan, the USSR, and the United


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16

States, each took turns via military, political, or economic tactics to

bend the dragon to a tamable end. Britain carved out a niche in Hong

Kong interests, but agreeably let go as its power ebbed in the 20 th

Century wars. The USSR attempted to exploit internal politics in China

supporting Mao Tse Tung who defeated Chiang Kai-Shek (the nominal

U.S. ally in WWII) in 1948. Japan invaded, dominated, then surrendered

at the close of WWII and now, remains uncomfortable with a growing,

power-hungry Dragon.

But the United States broke through via the way all countries (initially)

like: money. Such a breakthrough comes with a price as the nation

grows stronger, it forgets the seed investments and sees its plight as

self-created, not externally driven. From the moment President Nixon

opened up a locked trade door ostensibly to put the once-mighty USSR

on notice that money has its benefits too the China boom was destined,

as too was the roiling up of Globalization.

Because of the great trade pairing with the United States, present day

finds China has over forty high-speed rail projects on the board and is

buying up natural resource companies from Brazil to Australia to the

African continent. It keeps its currency pegged to the U.S. dollar at a

ratio of roughly 6.5 Yuan to a Dollar. (www.x-rates.com: May 10, 2011)

When this Great Recession took hold, the Chinese government invested

over $600 Billion towards public projects to advert a recession in their

country. (Or more accurately, to keep GDP growth at or above 8% so as

to support the flood of workers from the poor inland farms.)

The Chinese utilize distinct advantages in size of population willing to

work for less, a huge trade (dollar) surplus that is unlikely to reset to a

an equilibrium, and a single party system, that while restrictive to

personal freedoms, is advantageous to a coherent and forceful economic

policy. China likely sees itself as a nation of engineers, whereas, the U.S.

became a nation of lawyers. Chinas internal engine growth model will be

continuously fueled by imported U.S. capital. And if they can maintain

such a spurt, China will surpass all expectations of this political-

economic model. In short, the China dragon is a flame-throwing

economic machine. And more ominously, it indeed knows its power and

is using it accordingly, if tepidly, to date.


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To reinforce this growth model, one could also argue that China has

embraced a happy medium between government private partnerships

as much of their success has come through a non-dogmatic, practical

and engineering way of operating an economy. Large private businesses

(from the United States, for example) bring know-how, a checkbook, and

eagerness to convert poor Chinese to capitalists, while the usual strict

government has a great tolerance for creating jobs with minimal

employee rights or environmental controls. Just jobs, baby, might be

the overriding credo for this nation of 1.4 billion plus souls.

As such, it has not seeded much in the way of its homegrown business

back to America. And likely wont as the United States created most of

them via Walmart and other big-box outlets; tech giant Apple employs a

million Chinese versus 50,000 in America9; and we have directly fueled

the homegrown that the Chinese government will not allow to move

back to a U.S. market. (Overtures made aside nothing substantive has

relocated to American shores to date.)

Economic analysts project that soon this flow of U.S. (and foreign

capital) will run dry because someone, somewhere else in the

Globalization spin-the-bottle game will refuse to kiss their homegrown

industries goodbye. Overt trade battles will then ensue. And the victors

are yet to be decided.

Straightforwardly, Our Eagle has flown too close to the stoking fire of

this Dragon, allowing its Communist leadership, inevitably, to dictate

how the United States operates in all trade markets, projects military

power, and crafts foreign policy. Such fierce competition came via the

one score and ten vampiric bleeding of our countrys assets, both

inherent in our People, and tangibly, in our Lands.

But it is time to remember why we are The Eagle and meant to soar.

Section VSection VSection VSection V. Finance,Finance,Finance,Finance, Money, and The BanksMoney, and The BanksMoney, and The BanksMoney, and The Banks. As stated, current

households are getting by on less; with no way to accurately predict the

designs of their companies, or if they will exist in the future global

economy. In 1950, manufacturing made up over 25% of Americas GDP.

9 Fareed Zachari. Restoring The American Dream: How to Innovate. CNN; June 11, 2011. 7PM CST.


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Now, this slice is less than 10%. And blue-collar workers have seen their

jobs disappear, not just once, but several times. The money chase for a

good salary or hourly position is increasing in complexity, and often,

tearing families apart in the hunt, with the ending being no betterthan

the beginning during this dollar trek.

Replacing this downward fall of industry, the financial sector has grown

to be over one-quarter of Americas economy in just the last half century.

Creating numerous instruments of finance far removed from the days of

Alexander Hamilton, J.P. Morgan, or the dandified financial titans of the

early 20th century.

Adjustable Rate Mortgages (ARMs), Collateralized Debt Obligations

(CDOs), Credit Default Swaps (CDS), NINJA (No Income, No Job, No

Assets) Loans and Structured Investment Vehicles (SIVs), alphabetically

came to represent the soup to the booming banking business of the early

21st century.

But within these here to fore unfathomable growth spurts and billions in

record profits percolating across Wall Street, came such complexity and

opaqueness that it took quantitative analysis and models to the razors

edge of their usefulness. Creatively determining what Main Street could

pay for their American Dream often meant playing a reverse game of

blink. The problem was that the Common Man blinked too quickly (and

much too often) for the cumbersome, eyes-wide-shut banks once the

unraveling began. Models had no downside predictor for when the

tsunami of credit issuance stalled or froze; their shaky mortgagers

stopped paying on 2/28 interest-only ARMS; or when ordinarily

conservative folks (now spending liberally their meager equity) were

abandoning their homes in the hundreds of thousands while the trillion

dollar banks had their too meager default departments suddenly doing a

booming business of work out plans for losing money as slowly as

possible via the paperwork reshuffle and re-reappearing act.

Innovative though these quants of The Street are, the self-reinforcing

rational exuberance and predictable turbulence of packaging up debts,

obfuscatingly hedging bets, removing credit lending standards, over

priming the cash pump, slicing and dicing now homogeneously toxic

assets for a public at-large, and a private buyer living in largesse was


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Ayn Randian; self-indulgent; overrating a libertarian ideology to a market

fatalistic conclusion.

These top-down approved policies might be tragic to a rich mans bets;

assuredly dooming to a $35,000 a year meat packer in a Chicago

warehouse tripping on down LSD from the inception of such monetarist

economic models. Our span of green pastures are now weeded with the

corporate death knells, thousands of homes abandoned, and a sense we

have little to own, but much to pay for in regard to quantified

qualifications of the octo-yearly Fed meetings.

Sub-prime was called the trigger; and the American Dream was the chalk

outline.

And no one could ever blink again. Or so it was thought. (Much akin to

1929.)

As the expanding financial derivatives market and the multi-trillion dollar

do-it-all financial firms lent easy credit to stagnant income earners

(without the preferred prerequisites to paying back the balances),

enormous entities such as AIG, Fannie Mae, Freddie Mac, Countrywide

Financial, Bear Stearns, Lehman Brothers, Washington Mutual, IndyMac,

Wachovia, GMAC, GE Capital, Merrill Lynch, Morgan Stanley, Citigroup,

Bank of America, Wells Fargo, Goldman Sachs, and JPMorganChase

came either prostrate to the beggars table of the United States

Government for immediate assistance and intervention, or were scared

to the point of bank runs, demanding collateral from weaker-positioned

financial players, or engaged in panicked selling of securities to stave off

angry investors or the closures of their doors permanently.

Some did succumb to the financial wheel of fate: Washington Mutual,

Bear Stearns, Merrill Lynch, and Lehman were forced to close or were

badly digested by larger interests; Countrywide merged shakily into Bank

of America while Wachovia married Wells Fargo after spurning

Citigroups shotgun overtures; AIG, Fannie Mae, and Freddie Mac were

taken over by the U.S. Government, diluting shareholders en masse.

As a financial wheel of fate escapee, Citigroups share price broke the

buck ($1) while it held over $2 Trillion in Assets. At one point, the FDIC


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head (guarantor of deposits up to $250,00010) suggested the umbrella

company should fail. The Treasury Secretary was beyond himself of this

suggested idea of Citigroup going through receivership.11 It would have

been the largest bankruptcy (by a wide margin) in U.S. history. And at

that moment, would have assuredly ruined the confidence and the plans

installed (via TARP) to deal with this financial domino effect. (That of

shaky confidence in banks once one massive entity fails, the others look

more suspect whether they are, or not.)

(Economic and HistoricalEconomic and HistoricalEconomic and HistoricalEconomic and Historical NoteNoteNoteNote: A few banks were used as conduits for

government intervention even though free market ideology states such

intervention is strictly taboo. Moral hazard is used as the key argument

against such abandonment of free market principles. Yet, the

consequences of the hands off approach were seen as catastrophically

worse than no intervention, even by the ardent free market adherents,

namely the Fed Reserve, Treasury Secretary, and The Banks themselves.

Adverting a Great Depression IIwas seen as the higher motivation.

Yet, historically, it has been noted that the Great Depression was

brought to life by too much easy credit (consumer debt) and borrowing

on margin (for the stock traders) during the run up to October 1929. The

nation-state responses to that crisis aggravated the problem as beggar-

thy-neighbor approaches took place around the world. And the Fed sat

on their hands doing very little to stimulate economic activity in the

early 1930s via monetary policy they could control. (Print money.)

In this case, the easy credit regime from risky mortgage applicants to

fragile industrially-employed workers and the leverage level of

investment banks (30 plus to 1 debt/asset ratios existed at Credit

Suisse, ING, Barclays, and Lehman12), insurance companies, and their

hedging ilk, certainly mirrored certain excesses of the 1920s run up to

the October 1929 crash.

Furthermore, such epic collapses were seen and warned against before.

19th century economist Alfred Marshall, who worshipped at the altar of

10 From the Great Depression Era until 2008, this guarantee was set much lower. $100,000 for each account was theamount prior to the Great Recession of 2007-2010.11 Roger Lowenstein. The End of Wall Street. New York: Penguin Press; 2010. p 278.12 Nouriel Roubini, Stephen Mihm. Crisis Economics. New York: Penguin Press; 2010. p 127.


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Adam Smith and mimicked John Stuart Mills ideas, felt reckless

inflations of credit were the chief cause of economic malaise and

championed monetary authorities to prevent them with a robust policy.13)

The Chain of Blame Model: U.S. Lending 2000-2007Sub Prime Ho me Bu yer: FICO avg. 590-620, redlined by lenders prior to 1990

Mo rtgage BrokersMortgage Brokers:

Incentives to p ush

products, gave self-

serving advice

Advice & D irect

Relationship

Mortgage LendersMo rtgage Lenders: Hugeprofits initially, growth m odel

2005-7, Countrywide: 97.2B

Ameriquest: 80.7BNew Century: 76B

First Franklin: 68BLong Beach M ort: 65.2B

Fees &

Bonuses

& Q uotas

Loan: High Interest, Bet Hom e

Value Appreciates Quickly

2/28 ARM, interest

only, Justified only

by Home Price

Rises, Speculators

and Average Bad

Credit Risks alikeJoined Market

W.S. Investment Banks & OldW.S. Investment Banks & O ld

Depositor BanksDepositor Banks: Used Ranieri/Salomon Bro. Mortgage Model of 80s

Countrywide Bank of America

First Franklin Merrill Lynch

Long Beach Mort WaMu

Mortgages:

Bundled up by the

1000s($1.3 Trillion)to be securitized for

income streams

Loans: Money plentifulin low interest

(1%) environment

Rating Agency

S&P

Fitch

Moodys Bought

or shoppedfor AAA

RatingsFrom 2nd

Rate MB A-educatedinvestment bank w annabes

Assigned AAATo BBB Subprimetranches

RMBS

CDO

Warehouse/Conduits

CDS

CDS

CDS

Mortgages

To Package

Investors

Interest via home owners

Cash flow to supply some

Funding for more loans

SIVShadow Banks

Cash forABCP

Insurers:

AIG

MBIA

Sliced

Tranches:

Combined

Insured

Pyramid

Of Risk

USEconomy

(Tranch pays in proportion

to risk: junk, mezz, senior)

Bet Market

Insure Bonds

13 John Cassidy. How Markets Fail. New York: Farrar, Straus and Giroux; 2009. 36.


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The above model is hardly self-explanatory.

Homebuyers FICO scores were glossed over due to a necessity to keep

the line moving, to build houses and the boom, and to provide The Street

with product to slice and dice and pass on to investors, insurers, and

other entities around the world. Barriers once too strict redlining whole

neighborhoods were now, too liberal, assuring some very bad risks

received loans. Speculators too were all too willing to join the fray. Yet,

no one seem to mind the store. Bankers just rolled eyes; and passed

the bucks literally to their borrowers.

Mortgage Lenders/Brokers were poised to jump into the sub-prime

lending model because: money was available to lend at record low rates

(2002-2005); financial modernization act (Gramm-Leach Bliley Act of

1999) removed barriers to cross-pollinating banking activities; newly

innovative markets for securitizing debts were unregulated and ill-

modeled based on only 20 years of historical data; rating agencies had

extreme conflicts of interests as fees for rates were shopped to best

rater for the best fees.

Blue chip firms, as discussed, molded and manipulated lenders to their

most useful end. They pressured S&P and Moodys for quick ratings of

subprime tranches taking the best slices of the worst loan pies,

recombining them into a smells-different-because-I-say-so pizza ate by a

gluttonous and ravenous market only to sometimes swallow their own

slices, thus getting sick from their own home cooking. (Credit Default

Swaps (squared and cubed) and SIVs were a broiling haven for this little

dilemma.)

Investors swallowed the punch of the boom early on. Then, as

doomsday struck, credit froze, tranches triggered insurers like AIG

(London) to pony up for the casino bets made with Goldman Sachs, the

chain snapped, the pizza was poisoned, and no one knew who held what.

Authors SubAuthors SubAuthors SubAuthors Sub----21212121stststst Century Blackjack AnalogyCentury Blackjack AnalogyCentury Blackjack AnalogyCentury Blackjack Analogy: For years, the mortgage

bond market played the house where they held 20 on the deal and

investors rarely beat the house (via betting defaults) for more than a

marginal win. It was boring for both sides as they knew the outcome,

pre-deal. Enter a new deck of cards where the aces and faces are


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doubled, tripled in number, but the mortgage bond market holds only a

19 on the deal out. Suddenly, payouts are regular and enormous under

the blackjacks double down rules. The casino could (and did) go bust.

Instead of caution, they make more special decks, open more casinos

with money from the government, investors, and homebuyers in this

ponzi-styled finance. The financial system teetered on a flip on these

cards.

Blackjack! was yelled across the world and the chips have yet to fall

neatly in place.

Section VISection VISection VISection VI. Revisiting the PastRevisiting the PastRevisiting the PastRevisiting the Past. As this Mortgage Market declined

drastically in 2007-2010, the number of households upside-down on their

homes (and debts) increased to levels not seen since the Great

Depression. The Credit Markets tighten to the point where even credit

worthy Americans were hard-pressed to receive access to their credit, or

were made to pay unusual high fees after years of loyalty. Inter-bank

lending (LIBOR) and other lending ceased to function properly in late

September/early October 2008. And the World expected dire

consequences and responded via their Stock Markets.

Trillions of dollars were pledged to buttress this Financial System in flux,

and often, in frail circumstances, around the world. Developed countries

such as England, Iceland, Ireland, Italy, Greece, Portugal, and Spain

were hit with austerity measures; riots and demonstrations, election

swings to the fringe, and xenophobic attitudes pervaded many of these

locales as a frustration response to losing prosperity, real or imagined.

This populist trend found roots in the United States during the 2010

elections, and thereafter. The Tea Party gained a sizeable foothold in

governance; Wisconsin, Ohio, Indiana, and other states engaged in labor

union bashing and austerity-by-threat tactics; and protests came from in

the minority legislatures, teachers, police, and other governmental

servants. Islamic worshipers mosque nearground zero (9-11) was made

into a hot button issue shortly before the 2010 mid-term elections. Even

the President found persistent attacks on his legitimacy to be the

president due to his Hawaiian birth certificate or certificate of live

birth.


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In April 2011, the United States Government was brought to the brink of

a possible shutdown over amounts that a single investment bank of the

genre outlined above routinely traded in a day. (And one French trader

lost $7 Billion back at the height of the doomsday machine.) This

financial pittance came after six months of stalling to make the

necessary cuts, and six different deadlines for the completion of this

less-than-onerous task: that of creating a fiscal year budget.

And the debt ceiling fight supplanted this minor fiscal topic soon after.

Reflecting, at minimum, that concentration on important issues has

become too difficult for the people in charge; and we are replaying parts

of the 1930s in many ways giving a podium to fringe ideas while not

addressing the real and critical concerns of our country.

Historical precedence tells us this time is no different.

Section VIISection VIISection VIISection VII. Rivals to Prosperity and FreedomRivals to Prosperity and FreedomRivals to Prosperity and FreedomRivals to Prosperity and Freedom. The American competitive

advantage of Education, Infrastructure, and Manufacturing has

evaporated and exported as developing and developed regimes are

exploiting weaknesses and offering American multinational corporations

access to cheap, unencumbered, and pliant labor forces that can not or

will not stand up for better working conditions. Their enormous profits

are kept, often tax-free14; and America grows more complacent, and less

able to catch up when our dollars stay in the hands of never-friendly,

duplicitous regimes, who, reinvest by buying American assets (our debts)

with little regard for the American peoples way of life. Thus, we are

trapped in a cycle that has to be reversed.

These Rivals in this Global Marketplace were once the bane of our

Existence, not for their economy, education, infrastructure, or political

ideas, but because they held Freedom in prison, and ignored their people

forthwith. They still do; but forcefully supplant their peoples emerging

industriousness, and desires for a political voice, with the economic

strip mining of natural resources and pay lip service to improving their

peoples lots and the fact the resources are indeed, limited, makes it

14 Reports in 2011 suggested that GE and several banks listed above would not pay any U.S. Federal Income Tax.


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more beneficial to ignore the struggling population while amassing

wealth for the selected few.

As our once proud manufacturing economy needed an overhaul

replacing 20th century assembly lines with advanced systems and a

superior infrastructure lattice befitting of a world power we have spun

our wheels in the doldrums while our once economic inferiors have gone

ahead on many fronts, building massive dams, towers, and highway and

rail systems, often at the urging of the very American corporations the

U.S. fueled to prosperity in the past century. And these benefits came

primarily to an elite few; and the countries that do gain such victories

spared no gratitude towards the executives that have made their

presence uniquely felt in the Mumbais, Shanghais, and Dubais of the

planet.

A recent example of degradationA recent example of degradationA recent example of degradationA recent example of degradation: The Society of Civil Engineers graded

the nations Infrastructure at a D . Roads are spread far and wide while

urban planning systems are miserable failing. The spreading out of

society from cities to suburbs has resulted in too much highway, too far

from primary economic activity, and too few dollars to maintain them.

The efficiencies of cities (the stacking of services utility,

communication, logistics of food and transit) counters what logic is put

forth by those who like large lots in the far off areas that pay low taxes,

use enormous amounts of resources, but stress not just the local towns

but their neighbors as well.

Education is leaving behind our kids because it no longer is designed to

work towards a collective end. Even Adam Smith believed in universal

public education,15 by far, no Socialist. While we advocate towards all

measures of getting young people to know their ABCs, I23s, and Do-Re-

Mes, we have stalled progress by focusing on testing instead of learning.

Students in America can have all the access to tools (iPads, laptops,

etc.) but if the teachers are hamstrung by politics and procedural edicts

handed down from a school board biting their nails over budgets and

funding, the kids are likely just playing parlor games. (And, of course,

some students will come through just fine but the competition is

15 Mark Skousen. The Making of Modern Economics. 33.


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surpassing us. As China now turns out more patents and produces more

graduate level college students than the United States does.16)

Section VIIISection VIIISection VIIISection VIII. Natural Resources and Energy Policy.Natural Resources and Energy Policy.Natural Resources and Energy Policy.Natural Resources and Energy Policy. Energy, Environment,

Economics and Existence are intertwined with the ignoring of One, or

more, to come with the vicious Human price (at some point) in the

response of (and to) the Others. Such Human costs come today only with

daily, personal aggravations, and the slow, brutal destruction of the

Middle Class and Middle America. Such Dependence has become a way

of life for many, many millions.

In mid-2008, oil prices recorded an all-time record north of $140 per

barrel. By January 2009, the price shuddered in at $35 per Middle East

barrel. Oils rise by March 2011 to over $100 again, may indeed, stall an

economic recovery to a woefully gas-dependent America. Yet, as of this

writing, the killing of the number one terrorist in the world, has caused a

dramatic (if short-lived) fall in the price. (Reflecting intense volatility to

the world oil market based less often on the fundamentals of production

and consumption, more on rumor, events, and speculation.)

Since the 1970s, America has become more and more dependent on oil

imports reaching nearly 70% of our Nations usage as we stagnated at

6.5 million barrels produced per day, while using 20 million to maintain

our travel needs and desires. (SeeSeeSeeSee: U.S. Crude Oil Production, below)

This significantly addictive usage is hamstrung by our foes, and our

frienemies Venezuela, Russia, Saudi Arabia, Angola, et. al. who are

the controllers of Our Oil Tab. As stated, competition from our new

economic rival China is dawning, causing geo-political forces that we

react to, more than shape. (China has surpassed the U.S. in total energy

resource usage (2010) 20.3% to 19% leaving the remaining five billion

plus souls to fight for 60% of the energy pie.)

It is convenient to maintain the happy illusion that as long as we can pay

for the oil that is pumped, the relationships we maintain with Saudi

Arabia, Libya, or Sudan, for example, are not disconcerting. However, it

is a fools position to believe such oil dependence is a healthy gamut to

continue in volatile times. For it is highly unlikely that as China

16 Fareed Zachari. Restoring The American Dream: How to Innovate. CNN; June 11, 2011. 7PM CST.


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increases its consumption to far surpass the United States, that all

OPEC and non-OPEC nations can increase production in lock step. (And

many countries have sought an alternative way out of this energy

squeeze. Or befriended the nations most likely to produce and sell oil

directly in a tight market to come. Cutting deals offmarket is

becoming more and more prevalent and reflects self-interest that will

become more destabilizing.)

U.S. Crude Oil Production

-0.2%

-3.1%

-5.9%

-1.0%

-0.3%

-1.0%-1.1%

-4.6%-4.4%

-1.5%

0.0%0.8% 2.5%

-3

-2

-1

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Change

from

Prior

Year

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

Million

barrels

per day

Lower 48 Production

Alaska Production

U.S. Annual Growth

Short-Term Energy Outlook, July 2008

Forecast

As such, alternative energy outlets are sought, ethanol, for example. We

(among other nations) began to trade food essentials for fuel security.

Prices for corn skyrocketed. World food markets were dangerouslydepleted. Either an alternative fuel has to be designed, or else, we pit

our nations need for fuels against other nations right to eat.

Even as an alternative hope, electric cars and plug-ins have not taken off

yet as most Americans were hard pressed to afford $30,000 plus debt

loads in a stingy credit market for a new car with a limited range (100


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miles) and the lack of charging stations nationwide. (And at least 50% of

Americans were considered to have bad or sub-optimal credit.17)

(WorldWorldWorldWorld Crisis 2011Crisis 2011Crisis 2011Crisis 2011: As this oil-ethanol-food triad took place, Egypt, Libya,

Tunisia, Yemen, Syria, and Iran, have all seen populist uprisings due to

lack of freedoms, stagnate economies, and scarce food stuffs that

pressure cook these largely 3rd world or petrodollar-dependent countries

to a revolutionary boil that will take years to sort out. This happens

against the backdrop of other world players taking sides, exploiting

neighbor countries, or these revolutions for political or economic ends.)

As more and more people plow to create fuel, drill for oil in offshore

deeps, and hunt for anyway to make their machinery go farther on less, it

should bring us to a foregone conclusion: the day of cheap natural

resource exploitation is coming to an end; and the remaining resources

must be harnessed efficiently and effectively. Regardless of belief in

climate change, the access to food, energy, and life staples must be

designed with the interconnection to our Earth seen and respected.

Else, We do our progeny a severe disservice, and possibly, an ultimate

demise, if we selfishly and callously use up what is now available,

without reasonable and adaptable alternatives to replace what God put

here for Humanity to use to Grow, to Adapt, and to Maintain Our

Existence until such time is deemed right for His call for an End.

(MotherMotherMotherMother Nature v. ManNature v. ManNature v. ManNature v. Man: The March 11, 2011 triple crisis in Japan reminds

us of this all too well. An enormous earthquake, an epic tsunami, and a

far-reaching nuclear accident resulted in thousands dead or missing

and unmistakable reminder that the Earth holds more cards than we do.)

Section IXSection IXSection IXSection IX. Wars AbroadWars AbroadWars AbroadWars Abroad. We are still engaged in war. While we attempt

to extricate ourselves completely from one country (Iraq), two close

neighbors are taxing our military resources (Afghanistan and Pakistan)

while Libya and Yemen have recently added to our military forays on the

unstable globe. The costs in lives and coin are greater than we seem

able to justify, or maintain, yet, we do it, nonetheless.

17 Author lacks source but read this in a credit repair and resource book release in the last two years.


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Others regimes are revisiting the Cold War with their nuclear ambitions

and not-so-veiled threats. Iran, for example, is getting old Russia advice

on the nuclear options, $50 Billion monetary support from China for

their oil, and has rarely spoken highly of freedom while also in pursuit of

Israels demise directly, or indirectly.

The Middle East roils as it has during the last Millennia the so-called

Arab Spring presenting more headaches and establishment choosing

for the U.S. administration at hand. Our friends and foes worry alike:

Which quasi-democratic model is to be installed? What will the religious

preferences mean to this model? What resources inputted and outputted

will determine the status of the new nations future? What dictators will

be left? How will they respond to the change in the chess game?

And while the tragic story of 9/11 got a near-term ending, with the killing

of Osama bin Laden, the war on terrorism is never going to be won out

simply by the death of a so-called leader. The problem will transmute

into a new threat. (The Cold War lasted nearly 50 years for a logical

comparison. And it took a decade to kill bin Laden. And now Pakistan

may be part and parcel to the terrorism pyramid. Keep your friends

close, your enemies closer, comes to mind.)

Our military spending contributes greatly to the Budget Deficit. It has

been a policy for nearly 60 years to grossly overpay for weapon systems

and deploy and maintain bases in far-flung lands. While it is Patriotic to

serve in the Armed Services, it is increasingly difficult to justify these

outlays given the track record since Vietnam and our crisis debt loads.

The scales of finance are tipping greater against a large and well-

maintained militia, at least under the current paradigms under which it

operates. The worlds policing power comes with a cost a very

definable outlay and it is appropriate that the United States either

recoup such costs, or do a better job of assessing which battles it will

fight, and with clearer ends to such engagements designed.

How this particular action is addressed will ultimately define us in the

annals of history.


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Section XSection XSection XSection X. Internal Conflict and CourseInternal Conflict and CourseInternal Conflict and CourseInternal Conflict and Course Correction.Correction.Correction.Correction. Our government has

been severely taxed to function properly; as the divide over social ills,

economic philosophies, foreign policy, and domestic design have been a

source of bitter feuding without a significant altering of the direction of

the country in a manner that speaks of the deeper understanding and the

absolute necessity to embark on a drastic course correction.

Instead, we list to port; then to starboard; and back, while seemingly

cast adrift by the efforts of this process.

And no one man is able to reset this course alone.

The Problems are vast; multi-trillion in nature, and currently are

addressed with only piece-meal and hen-pecked legislation. Meager

victories are attainable but never go to the root cause and so, the

time is ripe for amending what it is to be under Constitutional Rule.

III. The Founding Fathers and The Framers Action PlanIII. The Founding Fathers and The Framers Action PlanIII. The Founding Fathers and The Framers Action PlanIII. The Founding Fathers and The Framers Action Plan

Facts are stubborn things.~ John Adams

Section I.Section I.Section I.Section I. Visionaries.Visionaries.Visionaries.Visionaries. The Framers to Our Constitution and the Founding

Fathers were not idle people. No one accused Adams, Franklin,

Hamilton, Jay, Jefferson, Madison, Morris, Sherman, or Washington of

inaction or paralysis in an arena of battle. They did not just sit by and

wait for things to happen. They made things happen. They were builders;

doers; dreamers; entrepreneurs; inventors; leaders; opinion makers;

philosophers; revolutionaries, scholars, and visionaries.

After winning the Revolution, these visionaries continued to work under

the existingArticles of Confederation, which was a firm league of

friendship. (The Ground on Which We Stand, Kay, 1969.) However, the

Articles were limited by taxing powers, commerce regulation, and a

unicameral legislature that needed 9 states out of 13 to approve bills.

The Articles proved unfit to run a nation that was all ready the size of

France in territory, and could expand quickly to the size of Western


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Europe. And many European foes were willing to bet that our young

Nation would falter under that exact strain.

Action was needed.

The Framers went to work, in secret, and to that end, achieved a lasting

document that molded well into Americas Manifest Destiny. What has

transpired in the last 224 years is a testament to its beauty and

foresight, while its flaws are only all too human.

But We are responsible for continuation of the Founders Vision.

IV. The Proposed Solution: A Constitutional ConventionIV. The Proposed Solution: A Constitutional ConventionIV. The Proposed Solution: A Constitutional ConventionIV. The Proposed Solution: A Constitutional Convention

Section I. BaitSection I. BaitSection I. BaitSection I. Bait nnnn Switch and The Media.Switch and The Media.Switch and The Media.Switch and The Media. As we have seen in the past

century, the advancement of technology has given us a way of life that

many would never cede to any foe. With such a vast and inescapable

interdependence on the function of technology within the framework of

Society, it is discouraging that we cannot count as quickly amongst our

Strengths the ability to utilize this advantage immediately to improve

upon our current state of Affairs, as they stand, across the wide

spectrum of previously stated ills.

While our nation does have such immense problems, many fellow

Americans are, at the present moment, happy and content. They may

feel that they made superior choices, and therefore, are not at any

advantage to change or assist in the moving forward of this 225-year old

journey from the infant Democratic Republic to a teetering and faltering

American Empire as contended in the first part of this pamphlet.

They may not even see the problems (ora problem) as one of debt, or

trade, employment, natural resources, education, infrastructure,financial responsibility and regulation, or military foolhardiness abroad.

The eroding of the nation may be solely of a socially driven nature: the

laziness and mollycoddling of youth; the spendthrift thirty something; the

obscenity-laced society with a lack of God and morality be damned; the

migration of foreign people into the fold; or the lack of individual

responsibility from youth to old age; or the obsession with stuff.


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The resulting media wars and commentaries from the big screen to the

blogosphere makes the current technology no better than the old ones

pen, paper, newspapers, and books in having a reasonable discussion if

reasonable people are not in the fray, and also, a driving force in these

grown up discussions. Ideological and political platforms are just as

entrenched across the spectrum of technology as they have always

been. (Pulitzer v. Hearst would be a 20th century example.)

To take a most recent debate, and as discussed, the right to be

president is, under the U.S. Constitution, tied to being a natural-born

Citizen of the United States of America. That can be conferred by: being

born in a United States state or recognized U.S. territory, such as Guam,

for example. (Article II, Section I, Paragraph V.)

After two and a half years, Barack Obama produced again a certified

copy of his birth certification in Hawaii. The issue is not his birth; rather,

it is the fact we are still discussing his locality after more than half his

term in office is completed.

What ifhe was found to be not an American citizen? What would that say

of not just the Democratic Party but the Republican Party too? What

does it say about our politics or governance that such a simple task to

determine birthplace is brought around again and again via the media

wars some three years later?

But the more pressing and urgent Crises are dilemmas we face in our

economy daily. Americans potentially shelling out $5 to $6 or more per

gallon gasoline while driving miles from suburbia; the state of

emergencies in weather destructed places all over the Midwest and

South; the foreign wars we waged for a decade; the slow replacement of

millions of jobs, by often, lesser paying ones; the real competition from

abroad as those countries ramp up a 21st century infrastructure and

technology-laden burgeoning empire while we rest on our 20 th century

laurels in hopes we will be remembered as an entertaining lot to our

fellow citizens of the world. And a list could be generated to include:

overcrowded and costly prisons, endangered wildlife, homeless people,

domestic violence, civil discourse online, white collar crime, political

corruption, health care, food safety, and so on.


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As a result, we are indeed hamstrung by our inability to use such

technological wonders as a guiding and assisting force in directing our

country in the future: That of Constitutional Amendments to address the

Rights and Responsibilities and Privileges vested in our 21st Century

American Society and beyond. We have sputtered around tired and

media-driven issues that serve no purpose or pose a direction or solve

any great needs but ratings for the media mavens.

Instead, We dither, as America burns up its Capital and Credit worldwide.

Our Founders must spin in their graves from this detestable waste of

time and country. We, indeed, lack focus on the matters at hand.

TableTableTableTable. The TrillionThe TrillionThe TrillionThe Trillion----DollarDollarDollarDollar Club of Catastrophe Policies Oft IgnoredClub of Catastrophe Policies Oft IgnoredClub of Catastrophe Policies Oft IgnoredClub of Catastrophe Policies Oft Ignored

Bush Era Tax Breaks (2001-2011) $1.0 Trillion plus

China Trade Deficit (2005-2010) $1.46 Trillion

Wars Abroad (Iraq & Afghanistan) $1.5 Trillion plus

Sub-prime Loan Origination Debacle $

Documents

2nd Constitution 21st Century Common Sense