Common Sense with Paul Jacob

On July 16, 1931, Ethiopia’s Emperor Haile Selassie I signed a new Constitution. Not exactly a model of limited government, the new document proved that the emperor was in keeping with the time, which was a period of weakening constitutional limits in America, Europe, and Britain. A flavor of the document can be gained by its most “rights-oriented” measures:

Art. 22. Within the limits laid down by the law, Ethiopian subjects have the right to pass freely from one place to the other.
Art. 23. No Ethiopian subject may be arrested, sentenced, or imprisoned except in pursuance of the law.
Art. 24. No Ethiopian subject may, against his will, be deprived of his right to be tried by a legally established court.
Art. 25. Except in cases provided for by law, no domiciliary searches may be made.
Art. 26. Except in cases provided by the law, no one shall have the right to violate the secrecy of the correspondence of Ethiopian subjects.
Art. 27. Except in cases of public necessity determined by the law, no one shall have the right to deprive an Ethiopian subject of any movable or landed property which he owns.
Art. 28. All Ethiopian subjects have the right to present to the Government petitions in legal form.
Art. 29. The provisions of the present chapter shall in no way limit the measures which the Emperor, by virtue of his supreme power, may take in the event of war or public misfortunes menacing the interests of the nation.

On July 15, 1976, Jimmy Carter accepted the nomination of the Democratic Party to run for the presidency.

Three years later, as president, he gave his infamous “malaise” speech, in which he focused on energy but did not mention the one thing that actually helped turn the 1970s’ energy crisis around: the phased deregulation of oil prices that had started three months earlier, under his own directive. Instead of touting this deregulatory effort, Carter did the politic thing, promising a number of new government programs while extensively grinding a “crisis of confidence” message and vaguely speaking of a spiritual challenge.

The deregulation was startlingly effective, in the long run — though the immediate effect was a rocketing of prices. These high prices presented profit opportunities, and (lo and behold!) domestic production greatly increased, allowing for many, many years of lower prices. Those high prices would have worked better as market signals had not Carter and Congress also established “windfall profits” taxes, to take away those temporary gains to existing business.

Had Carter deregulated prices earlier, he would probably have been re-elected president. Had he emphasized deregulation, he probably would have beat back Ronald Reagan’s free market rhetoric — with actual action.

The price controls had been put in place earlier in the decade by the Republican president at the time, Richard M. Nixon, with the great help of his aides Dick Cheney and Donald Rumsfeld.