The stock market rises and then crashes. Housing prices soar and then plummet. The Federal Reserve causes these booms and busts by constantly expanding and contracting the supply of money and credit.

Credit expansion by the Federal Reserve increases the demand for producer assets and investment instruments. This causes bubbles in things like stocks and housing. When the Fed then contracts credit to avoid systemic price inflation the asset bubbles burst.

This is the history of the Federal Reserve — booms and busts, mixed with episodes of economic stagnation and high inflation like the 1970s.

Even before the Fed was created in 1913 government manipulation of money and credit caused repeated bubbles and contractions. One big source of this mischief was government imposed exchange ratios between gold, silver, and the U.S. dollar. When these hardwired exchange ratios didn’t match reality, problems ensued.

It’s important to recognize that economic perfection isn’t possible. Investors will always make mistakes. But we would expect these mistakes to be randomly distributed throughout the economy, and occur at different times. What causes a bunch of investment mistakes to cluster in particular sectors at a specific time, causing systemic problems?

Only government has the power to impose universal conditions on the economy, from the top down, causing investment mistakes to cluster, like they have in the housing market. The government can do this by passing laws and creating programs that favor one type of investment over others, causing a boom in those sectors.

But the Federal Reserve, with its monopoly control over the supply of money and credit, is an even more powerful mechanism for causing investment errors to cluster.

We need to get off the Federal Reserve roller coaster. We need to end centralized top-down control of the money supply and interest rates. We need a true free market in money and banking. We must abolish the Federal Reserve.

Congressman Ron Paul has a bill to accomplish this. It’s called the “Federal Reserve Board Abolition Act,” and a national coalition called “End the Fed” is working to bring attention to this bill.

Please use our quick and easy Educate the Powerful System to ask your elected representatives to co-sponsor the “Federal Reserve Abolition Act” when Congressman Paul re-introduces it in this Congress.

The “Enumerated Powers Act” would force Congress to cite its Constitutional authority for every law it passes. When we last reported to you in late July this bill had 52 co-sponsors in the House, and had just been introduced in the Senate by Tom Coburn, gaining a whopping 22 co-sponsors almost immediately.

Progress has slowed since then, but there is another new co-sponsor in the House. Representative Pete Sessions of Texas came on board on July 23, 2008, just a couple of days after we last contacted Congress about this bill. Maybe some of you made the difference with Mr. Sessions, so let’s keep pushing . . .

* If your Rep. or one or more of your Senators is a co-sponsor, please thank them (we’ve provided a list of co-sponsors below my signature).
* If one or more of your elected representatives is not on the list, ask them to please become a co-sponsor

You can send your message at DownsizeDC.org here.

NINTH AMENDMENT: The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

TENTH AMENDMENT: The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Here are the co-sponsors in the Senate . . .

Sen Allard, Wayne [CO] – 6/19/2008
Sen Barrasso, John [WY] – 6/19/2008
Sen Brownback, Sam [KS] – 6/19/2008
Sen Burr, Richard [NC] – 6/19/2008
Sen Chambliss, Saxby [GA] – 6/19/2008
Sen Cornyn, John [TX] – 6/19/2008
Sen Crapo, Mike [ID] – 6/19/2008
Sen DeMint, Jim [SC] – 6/19/2008
Sen Dole, Elizabeth [NC] – 6/19/2008
Sen Ensign, John [NV] – 6/19/2008
Sen Enzi, Michael B. [WY] – 6/19/2008
Sen Graham, Lindsey [SC] – 6/19/2008
Sen Grassley, Chuck [IA] – 6/19/2008
Sen Hutchison, Kay Bailey [TX] – 6/19/2008
Sen Inhofe, James M. [OK] – 6/19/2008
Sen Kyl, Jon [AZ] – 6/19/2008
Sen McCain, John [AZ] – 6/19/2008
Sen Sessions, Jeff [AL] – 6/19/2008
Sen Sununu, John E. [NH] – 6/19/2008
Sen Thune, John [SD] – 6/19/2008
Sen Vitter, David [LA] – 6/19/2008
Sen Wicker, Roger F. [MS] – 6/19/2008

Here are the co-sponsors in the House . . .

Rep Akin, W. Todd [MO-2] – 3/6/2007
Rep Barrett, J. Gresham [SC-3] – 12/5/2007
Rep Bartlett, Roscoe G. [MD-6] – 3/6/2007
Rep Bilbray, Brian P. [CA-50] – 3/5/2008
Rep Bishop, Rob [UT-1] – 3/6/2007
Rep Boozman, John [AR-3] – 4/24/2007
Rep Broun, Paul C. [GA-10] – 2/13/2008
Rep Burgess, Michael C. [TX-26] – 6/9/2008
Rep Burton, Dan [IN-5] – 3/6/2007
Rep Cannon, Chris [UT-3] – 2/25/2008
Rep Conaway, K. Michael [TX-11] – 3/6/2007
Rep Cubin, Barbara [WY] – 3/5/2008
Rep Davis, David [TN-1] – 3/27/2007
Rep Doolittle, John T. [CA-4] – 3/5/2008
Rep Duncan, John J., Jr. [TN-2] – 3/7/2007
Rep Feeney, Tom [FL-24] – 4/24/2007
Rep Flake, Jeff [AZ-6] – 3/6/2007
Rep Foxx, Virginia [NC-5] – 3/6/2007
Rep Franks, Trent [AZ-2] – 3/14/2007
Rep Garrett, Scott [NJ-5] – 3/6/2007
Rep Gingrey, Phil [GA-11] – 3/6/2007
Rep Gohmert, Louie [TX-1] – 3/6/2007
Rep Goodlatte, Bob [VA-6] – 9/7/2007
Rep Heller, Dean [NV-2] – 8/1/2007
Rep Hensarling, Jeb [TX-5] – 12/12/2007
Rep Herger, Wally [CA-2] – 3/6/2007
Rep Hoekstra, Peter [MI-2] – 12/4/2007
Rep Johnson, Sam [TX-3] – 12/4/2007
Rep Jones, Walter B., Jr. [NC-3] – 3/31/2008
Rep Kline, John [MN-2] – 12/12/2007
Rep Lamborn, Doug [CO-5] – 3/6/2007
Rep Mack, Connie [FL-14] – 12/12/2007
Rep Marchant, Kenny [TX-24] – 3/6/2007
Rep McCotter, Thaddeus G. [MI-11] – 3/6/2007
Rep Miller, Jeff [FL-1] – 3/6/2007
Rep Musgrave, Marilyn N. [CO-4] – 12/12/2007
Rep Myrick, Sue Wilkins [NC-9] – 3/6/2007
Rep Paul, Ron [TX-14] – 3/6/2007
Rep Pitts, Joseph R. [PA-16] – 10/25/2007
Rep Poe, Ted [TX-2] – 3/12/2007
Rep Price, Tom [GA-6] – 3/5/2008
Rep Roskam, Peter J. [IL-6] – 6/3/2008
Rep Sali, Bill [ID-1] – 12/5/2007
Rep Sensenbrenner, F. James, Jr. [WI-5] – 5/15/2008
Rep Sessions, Pete [TX-32] – 7/23/2008
Rep Smith, Lamar [TX-21] – 4/23/2008
Rep Souder, Mark E. [IN-3] – 4/9/2008
Rep Stearns, Cliff [FL-6] – 5/23/2007
Rep Tiahrt, Todd [KS-4] – 4/24/2008
Rep Walberg, Timothy [MI-7] – 3/9/2007
Rep Wamp, Zach [TN-3] – 4/4/2008
Rep Weldon, Dave [FL-15] – 5/1/2007
Rep Westmoreland, Lynn A. [GA-3] – 3/6/2007

It’s time for Congress to “cite chapter and verse.” When they pass new laws or spend taxpayer money they should be required to point to the specific language in the Constitution that empowers that action. The “Enumerated Powers Act” would require them to do precisely that. Help us bring this bill to a vote.

The specific, “enumerated” powers of Congress are spelled out in Article of I Section 8 of the Constitution. Congress has, by our count, twenty powers or areas of responsibility. You can read the list here.

Because these powers are delegated from the people, they are the only powers Congress has. But our Founding Fathers went further than simply listing what Congress could do. They also listed, in the Bill of Rights, many specific things the government could not do.

Most importantly, the 10th Amendment specifically limits the federal government to just those powers and functions named in the Constitution. And the 9th Amendment makes it clear that the people also have many other rights the government must respect, extending far beyond those actually named in the Bill of Rights.

The Ninth Amendment reads: The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

The Tenth Amendment reads: The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Taken as a whole, the Constitution creates a government of very few powers, and a great many limitations.

In addition, there is a tradition that every member of Congress, upon taking office, swears an oath to serve, protect, and defend the Constitution. Sadly, most of these oath-takers immediately become law-breakers, passing laws and expending funds in ways the Constitution forbids.

IN FACT, MOST OF WHAT THE FEDERAL GOVERNMENT NOW DOES IS BLATANTLY UNCONSTITUTIONAL.

Had Congress adhered to its enumerated powers the federal government would be vastly smaller, and far more decentralized.

The politicians in Congress rarely bother to offer Constitutional justification for their actions, but when pressed to do so they will usually misapply passages such as the “Necessary & Proper Clause,” or the “Commerce Clause,” or resort to Supreme Court decisions that are themselves unconstitutional.

Representative John Shadegg (R-AZ) has a plan to change all this. He has introduced “The Enumerated Powers Act” (EPA) – HR 1359 [You can read the entire bill on our Background page]. EPA would require every law passed by Congress to reference the specific clause(s) of the U.S. Constitution that grant the authority for that law.

What difference will it make if we require them to “cite chapter and verse” from the Constitution to show where it gives them the authority to pass a law, create or maintain a program, or lay a tax?

* Well, it might slow them down.
* It might mean that they reconsider a proposal instead of introducing it.

But we freely admit, this new law won’t stop them.

Instead, we believe it will build the evidence necessary to make some real reforms later. After all, how many different actions per day can Congress blame on the Commerce Clause before either a judge or the people revolt against the charade?

EPA might even, eventually, embarrass Congress.

There’s an old Texas _legend_ that says a young politician by the name of Lyndon Johnson was looking for an edge in his campaign. Johnson suggested to his campaign manager that they start a rumor that his opponent enjoyed sexual congress with pigs. His campaign manager reacted in shock: “Lyndon you know that’s not true.”

“Sure,” Lyndon is alleged to have replied, “I just want to watch him deny it.”

Well, Congress does lots of unconstitutional things, and that’s no rumor. Now, we just need to make them deny it. Send a message to Congress and ask them to pass EPA.