Reacting to the news that the Democratic governor of New Mexico, Michelle Lujan Grisham, has issued an “emergency order” banning the open carry of guns in her state, on September 10, the tweet account TimOnPoint offered a startling prediction/suggestion:
If the Governor of New Mexico can void the Bill of Rights, what’s stopping the Governors of Idaho and Texas from expelling the FBI and ATF, or Alaska allowing new energy production without the consent of the DoI, DoE and EPA. Let’s do this - go full republic.
That’s a powerful phrase: “go full republic.” That is, reassert the small “r” republican features of our Constitution, implicit in the whole document, but spelled out explicitly in the Tenth Amendment. And it’s full of investment implications.
Imagine: If New Mexico can go its way—and for sure, that’s an if, based on any number of legal and political factors—then why can’t other states go their way? Why can’t Idaho follow through on its aimed-for annulment of federal gun control laws? Why can’t Alaska reclaim its sovereignty over energy matters? Indeed, even if Lujan Grisham is slapped down—the Second Amendment is, after all, a part of the Constitution—what about other states to do other things that are more in the gray zone? For instance, the regulatory power of the Bureau of Alcohol, Tobacco, and Firearms, and the Environmental Protection Agency is not in constitutional, their power is statutory and administrative—and those are lesser powers. That is, for the ATF and the EPA, Congress passed a law, and the administrative state has taken it from there—to the point of excess, in the view of the Supreme Court in a quartet of recent decisions.
Sometimes it has seemed as though federal power was a ratchet. That is, once federal power was gained, it could never be lost. That was the progressive party line. But that’s been proven not to be true. To be sure, federal power was most definitely on the upswing for much of the 20th century, but in the 21st century, governors have been reasserting their powers, on matters ranging from schools to abortion to climate change to sanctuary cities/states. It’s worth emphasizing that it’s not just red states being anti-federal government, it’s been blue states, too. As T.S. Eliot once wrote, there are no lost causes—and no won causes. In the course of human events, everything is always in flux.
But to say that there’s no ultimate direction—the arc of the universe doesn’t bend any particular way—is not to say that there aren’t directions. That is, just because we can’t say that there’s a grand ultimate direction doesn’t mean that there aren’t directions in the meantime. This is the point of Directional Investing: There are plenty of trends, and the trend is your friend. These trends can be spotted, and sometimes perhaps shaped.
This author has been writing writing for years that the trend of our time is going to be the further expansion of federalism—or, to be blunter about it, states’ rights. That is, states making their own decisions, based on their heightened awareness that the federal government makes for a poor one-size-fits-all. And yes, our small “r” republican government—our Constitution—makes that all the easier, as the states are the natural form of compartmentalization, enabling them to be, as Justice Brandeis wrote nine decades ago, “laboratories of democracy.”
So what would happen if the states really went their separate ways? Shaping their own destiny? If New Mexico could make a ban on guns (at least open carry, although who should doubt that other states would go further if they could) stick? And if Idaho were to go the opposite way? And what if Alaska were to go all-out-Palin, on “drill, baby, drill”? There’d be a lot of diversity, that’s for sure, and also, a lot of economic opportunity, as investors reacted to, and perhaps helped shape, the new rules. It would help make the laboratories of democracy into laboratories of prosperity.
To point to one salient opportunity, what if a state were to suspend the onerous regulatory strictures Food and Drug Administration, as I have argued, here and here? At a time when public confidence in the public health establishment is at an all-time low, now could be the time to strike. The country as a whole might not be emphatic in its loss of confidence in Big Health, but you can sure bet that many states are. And that's the the genius of federalism: What's needed is the will of a single state, operating through democratic republican principles, to make a change. There would undoubtedly be controversy and court challenges and , but then, today, there's controversy and court challenges about everything. If a state could get out from under the wet blanket of the FDA, imagine the economic boom. The state being to medicine and medical innovation as Nevada is to gambling. If you build a medical enterprise zone, they will come.
So why aren’t we doing it? Well, maybe we’re in the process of doing that now. Maybe we are opening our eyes. Maybe it’s the process described back in the 16th century by the Frenchman Etienne de la Boétie, in his essay, “The Discourse of Voluntary Servitude.” As the title suggests, the servitude is often in our heads. One needn’t minimize the power of state power—soldiers, guns, prisons—to nonetheless see that a population suitably animated can find ways to stage a rebellion (hopefully peaceful) against tyrannic power. As Boétie wrote:
Obviously there is no need of fighting to overcome this single tyrant, for he is automatically defeated if the country refuses consent to its own enslavement: it is not necessary to deprive him of anything, but simply to give him nothing; there is no need that the country make an effort to do anything for itself provided it does nothing against itself. It is therefore the inhabitants themselves who permit, or, rather, bring about, their own subjection, since by ceasing to submit they would put an end to their servitude. A people enslaves itself, cuts its own throat, when, having a choice between being vassals and being free men, it deserts its liberties and takes on the yoke, gives consent to its own misery, or, rather, apparently welcomes it.
So there we have it. Some people think the status quo is fine. And perhaps, nationwide, they're a majority (although I doubt it). But the Constitution protects minority rights, and sees the states as a great bulwark of minority rights. So if, in a state, we no longer consent to the current regime of petty suppression, if we no longer welcome it, we can, working through the states, end our subservience. And that’s a cause worth winning. And along the way, there’s be money to be made.
Update: On September 11, the FDA once against gave an emergency use authorization for a new Covid vaccine. That is, all the trials and red tape are waived. It makes a difference that the FDA really believes in the urgency of vaccines, whereas other medicinal drugs, not so much.
