Was Obama Calling 911?
Thursday, 8. December 2011
Obama’s National Emergency Powers
As financial markets struggle with repeated failures by our central planners in ‘managing’ the crisis in the Eurozone, a recent statement by President Barack Obama is worth highlighting. On September 13, 2011, in a speech addressing criticism of his jobs plan, Obama stated in part:
“I get fed up with that kind of game plan, and we’ve been seen it for too long. Too long. We’re in a national emergency.”
Granted, this has been the worst recession, and worst jobs recovery from a recession, since the Great Depression. But a national emergency? Are we talking nuclear attacks, poison in the water supply, or a new and unstoppable infectious disease?
What is a ‘national emergency,’ anyway? Might those words carry legal meaning?
In fact, they do, and speaking of the Great Depression and financial markets, well, history matters.
When Obama was giving his speech back in early September, the flare-up in the crisis in the Eurozone was just getting started. Stock prices for large financial services firms in the US exposed to their counterparts in Europe were falling anew, while the CBOE “VIX” index (a volatility index, also called the ‘market fear index’) was spiking sharply higher. Money market funds in the US were also exposed, with European investments comprising a surprisingly large share of their assets.
Was this financial backdrop one component of Obama’s ‘national emergency?’ Correlation is not necessarily causation, the saying goes in econometrics. In other words, it could have just been a coincidence.
But it is worth recognizing as well the tinderbox underneath that phase. There is a very important area of constitutional law called ‘national emergency powers.’ The area deals with assertions of extraordinary Presidential and executive branch authority during a crisis, including any formally declared state of national emergency or a ‘time of war.’
For example, back in 1933, 48 hours after taking office amid a financial crisis, President Franklin Delano Roosevelt declared a national emergency and effectively ordered the closure of all the banks in the United States. At the time, the source of authority cited for this action was, quite questionably, the Trading With the Enemy Act of 1917.
After several decades of statutory evolution, a broader range of questionable but statutory authority for sweeping executive branch power over financial markets remains on the books today. In fact, one such current font of authority, 12 U.S.C. 95a, dates to the Trading With The Enemy Act. Another was developed soon after FDR took his extraordinary action. This statute, 12 U.S.C. 95(a), differs from the former on a few dimensions, not just the parentheses. It is the current product of the Emergency Banking Relief Act of 1934.
Do the safeguards promoting limited government envisioned by the authors of the United States Constitution bend and sway with the whims of central authorities during crises? Can emergency powers be abused by special interest groups at general expense? We will have more to discuss about this important area down the road. For now, interested readers are referred to a thorough, excellent paper by Congressional Research Service scholar Harold Relyea, a 2007 CRS report titled simply National Emergency Powers.
(p.s. Thanks to Ed Crane, founder and president of the Cato Institute, for flagging that Obama quote in a recent talk Crane gave in Chicago)
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PiedCow Says:
I apologize for being, perhaps, too frequent a commentor, but your offerings are always thought-provoking and worthy of discussion.
As I see it, the question of whether central planners undermine the framers’ intent regarding the idea of limited government is answered by identifying the social class to which the beneficiaries of limited government belong.
If, for instance, one identifies the elite as the subject of whether notions of limited government apply, the answer is an emphatic yes. The elite are free to do whatever they want, and frequently even with government assistance in the forms of contracts for their firms, markets for their products, tax preferences, and political support for their interests all over the “free world.”
If, however, one identifies the hoi polloi as the subject of whether notions of limited government apply, the answer is more difficult.
The difficulty lies in the threshold matter of whether the framers ever intended to protect the masses from government intrusion in the first place.
I think they didn’t. A good many of them owned slaves, they excluded women from their debates, they favored exterminating the natives, and gave countless other indications of their enmity to those of “inferior birth.”
Thus taking the one example of their extermination of the natives into account, I’d say that one can reasonably conclude that the framers tended to disfavor notions of limited government for the masses.
Those occupying positions of power nowadays strike me as being substantially the same as their predecessors, except that present “leaders” have added nuclear bombs, defoliants, cruise missiles and drone airplanes to their murderous arsenal.
gardenv Says:
Just slight misunderstanding perhaps-”… the source of authority cited for this action was, quite questionably, the Trading With the Enemy Act of 1917- probably isn’t questionable but does make sense as the “banksters” of the day, including Prescott Bush, were all in collusion with Fascists of Italy and Germany, in their machinations to escape the antitrust regulations put in by Theodore Roosevelt.
Sibel Edmonds Says:
@ Pied Cow: Please don’t stop! keep them coming. I may not respond to every comment, at least in a tinmely manner….but I read them all, and I appreciate them big time. By the way, I read your blog for the first time today (showed up on my stat sheet;-). Very interesting, refreshing; I’ll be back, and back again to check your posts.
@gardenv: Thank you for the note. Bergman is at this out of town conference …he’ll be back on Sunday, and I am sure he’ll be here to respond.
Soon we’ll have our interactive members’ forum where our members can post opinion/heads up/comments…It is under construction, and we hope to have it up and running by first week in January.
Bill Bergman Says:
Pied Cow, thanks, very interesting. There were certainly Founders working to the ends you identify, and to the extent things like the Shays’ Rebellion prompted demand for a more energetic central government protecting those classes, leading to the Constitutional Convention, well, things were moving to the ends you identify. But you may be overbroad; I suspect there remained a dedication to a rule of law for all, not just the masses. Over time, tho, law has become not a check on tyranny, but more of a tool of tyranny, with the emergency powers area one part of that story.
Gardenv, thanks, but I still think it was questionable, the TWEA was designed to apply to international transactions in a ‘time of war,’ but FDR and friends applied it to domestic affairs in peacetime, ‘as if we are dealing with a foreign foe.’
Luke Says:
Just wanted to mention that we’ve been in the midst of various declared national emergencies for a while, renewed by past and current administrations.
For example, a national emergency with respect to Iran since 1979.
http://www.whitehouse.gov/the-press-office/2011/11/07/notice-continuation-national-emergency-respect-iran
National emergency with regard to the 9.11 attacks.
http://www.whitehouse.gov/the-press-office/2011/09/09/notice-president-regarding-continuation-national-emergency-respect-certa
Peter Dale Scott has pointed out, in regards to the latter emergency, that Congress is required to review the case for the emergency in order to determine if it should legitimately continue. They have failed in this duty. He wrote about this and other issues in an article that appears on Global Research, if you’re interested.
http://www.globalresearch.ca/index.php?context=va&aid=19238
Bill Bergman Says:
Yes, Luke. Makes one wonder what an ‘emergency’ is, if it can last 10 or more years. But in this case, it’s a reminder that the Executive branch may try to do extraordinary things without Congressional ‘authorization.’ Another good historical perspective can be had from the Youngstown Sheet & Tube vs. Sawyer case, back in the Korean War.
Bill Bergman Says:
And thanks for the links, I’ll take a closer look tomorrow. PDS makes the point near the close of that article that the 9/11 Commission briefly discussed matters like these in their final report, it could be worth looking into that in light of an early-September 2001 statement.
Luke Says:
No problem. Thanks for the historical reference. What is profoundly disturbing to me is that people actually have to do research in order to determine to what degree the constitution still remains in effect, and that research is then stymied by the very offices of gov’t that the founding document is supposed to legitimate. I have to laugh at the absurdity, in spite of the seriousness of the situation.
Bill Bergman Says:
For some background, I was reading Gene Healy’s excellent book “The Cult of the Presidency” on the train in to work this morning. Surprising to find some precedent for the latest NDAA provisions providing for the use of U.S. military forces on U.S. soil against U.S. citizens. On p. 225, Healy describes “On October 17, 2006, the same day he signed the Military Commissions Act, the president also signed the Defense Authorization Act for FY 2007, Section 1076 of which covers the “Use of the Armed Forces in Major Public Emergencies.” That provision amends the 1807 Insurrection Act and provides a new, gaping exception to the Posse Comitatus Act. Where the Insurrection Act had limited the president’s domestic use of the military to situations involving “insurrection, domestic violence, unlawful combination, or conspiracy,” the new language allows him to use the army to “restore public order and enforce the laws of the United States” in “Natural disasters,” “epidemics,” “serious public health emergencies,” and “other conditions” — a catchall phrase that greatly expands the president’s power to use troops against citizens.