SPONSORSHIP PROPOSAL

It is more than just the federal debt. It is systemic federal government financial management.

We The People send about $4 trillion to the federal government every year and there are no rules in our Constitution about what Congress may, or must, or cannot do with it. None. Our Constitution says very little about money and offers no safeguards that could help insure wise financial policy. So Congress does the expedient things, the most politically advantageous things, often the self-serving things, and We The People forgive them year after year by overwhelmingly reelecting them. Congress jealously guards its powers of the purse while doing almost nothing to ensure that it wields those powers responsibly and effectively.

The budget of the United States federal government in 1791 was $4 million. Our nation’s operating budget today is about $4 trillion, one million times larger than it was when the Constitution was ratified. One would think that when our national government has grown so large and powerful our Constitution should be updated to help our elected representatives better manage so much of our money. But the Constitution stays the same, the behavior of Congress does not change, abuses continue, and the problems get worse.

Laws do not constrain Congress either. When Congress passes laws it can exempt itself from following them, or simply ignore them altogether. So when it comes to our money Congress is not constrained by either the Constitution or by the rule of law. Congress is not constrained by anything.
Congress does not promulgate rules limiting its own flexibility and power because it is not in their interest to do so. There is no upside for them from doing it and no downside for them from not doing it.

The interests of members of Congress differ from the interests of the people they are supposed to serve. And unless there is a crisis of some sort, We The People can’t be bothered to exercise the responsibilities of free citizens to rein in our federal government because it’s too hard.

The cumulative result of this irresponsibility of the Congress and the inattention of our citizens is massive federal fiscal mismanagement.

Most of us know that spending is out of control. Congress has authorized our federal government to spend more than its revenues for 67 of the last 79 years. In fiscal year 2019 the federal deficit is approximately $1 trillion, in a boom year, more than the entire gross domestic product of our United States just 47 years ago. Prior to the Covid-19 pandemic our accumulated national debt exceeded $23 trillion with no plans to stop, much less to pay back the huge sums that we owe. And the interest cost on that massive debt will itself soon cost over $1 trillion a year.

Many people now believe that spending is the only federal government problem that we should fix. The reality, however, is that runaway federal spending and our huge cumulative national debt are symptoms of decades of this more significant condition of federal fiscal mismanagement.

Solving the problem of federal fiscal mismanagement will require a national initiative to persuade our citizens to help ratify as quickly as possible a common sense, four-page-long package of Amendments to our Constitution to provide the important process imperatives to fix our financial management problems once and for all. This package of Amendments is called The Bill of Financial Responsibilities, the first interrelated package of amendments to our U.S. Constitution since the Bill of Rights was adopted in 1791. An effective version has been written and is ready to go. It is about four pages long. A copy is attached to this proposal.

In addition to pernicious deficit spending, federal fiscal mismanagement means that lacking Constitutional constraint our Congresses over many decades have:

• created a complex, 75,000 page, unmanageable Internal Revenue Code full of deductions, exemptions, exclusions, alternatives and other special circumstances, called in the aggregate “tax expenditures”, that total over $1.6 trillion a year, designed to engineer social and/or political outcomes by picking winners and losers through the sausage grinder of national partisan politics. The results permit one in five large, profitable U.S. companies and 47% of our citizens to pay no federal income tax while our government is drowning in debt. Our present Code is complex, secretive, corrupt, confusing, and unfair and rightfully the subject of profound and increasing distrust among our people.
• misappropriated approximately $3.2 trillion of our citizens’ Social Security and Medicare funds to pay other federal government obligations, thus preventing our people from earning competitive rates of investment return on their retirement and healthcare accounts and jeopardizing the future availability of enough money to pay promised benefits. This money must be timely repaid, thereafter to be separately held and professionally invested and administered in accordance with all the federal trust laws and powers long ignored by the Congresses that enacted them for the private sector.
• employed improper accounting, confusion, secrecy, and misinformation that massively understate our national government’s liabilities, mistakes and inefficiencies and prevents a complete, transparent, documented, and independently audited presentation of its true financial condition, according to generally accepted accounting principles developed and required by experts outside of government, free of political or bureaucratic pressures.
• authorized 175,000 pages of federal regulations full of unfunded mandates and stealth taxation without representation, many of which may not even be authorized in law, with no fair means by which the regulated can challenge the legality, applicability, or interpretation of the regulations other than through lengthy and costly litigation.

Justice Felix Frankfurter said, “The history of liberty has largely been the history of the observance of procedural safeguards.” Therefore we should recognize that we have almost no procedural safeguards in our Constitution to insure wise financial policy, and it is way past time that we amend it to include them.

Because Congress itself is the problem, and its Members show no inclination or ability to solve the problems their decisions have produced, then it falls to We The People to bring forward the proper structural solutions to change the rules by which our government must function in the future.

The goal of this project is to organize like-minded citizens, executives and professionals to create and lead a national campaign of education, persuasion, and action that will help secure ratification of the Bill of Financial Responsibilities as the next five Amendments to the U.S. Constitution.

The Bill of Financial Responsibilities is the right package to accomplish this intended objective. But let’s not kid ourselves. This is a heavy lift. But we have faced much worse and overcome. Success will require support. Solving big problems always does.

Amendment A – Taxation

• Congress is prohibited from including inducements, credits, exemptions, exceptions, deductions, incentives, or preferential rates in any tax law.
• In any income tax Congress may specify only income brackets and tax rates.
• Every citizen, legal resident alien, and every income producing enterprise must pay some federal tax.
• The entire Internal Revenue Code in effect at the time this Amendment is adopted is abolished.

Amendment B – Spending

• Expenditures by the Federal Government in any fiscal year shall not exceed that year’s revenues unless under a national emergency.
• Any federal law expected to cause a federal deficit may be declared unconstitutional by the Supreme Court.
• In the event actual there is a deficit in any fiscal year (other than for national emergencies) Congress and the President must create an offsetting surplus in the subsequent fiscal year.
• The President of the United States is empowered to exercise a line item veto over any part of any legislation requiring an appropriation of funds.
• A national emergency requires both a declaration by the President and two thirds vote of both Houses of Congress. During a national emergency a specific amount and duration of deficit spending may be authorized by Congress and the President as part of the normal legislative process.
• Action to terminate a national emergency shall require a simple majority of both houses of Congress and the approval by the President.
• Each year’s federal expenditures must provide for repayment of a portion of the outstanding national debt equal to the lesser of the remaining amount of the national debt, or $500 billion.
• Expenditures for qualified capital projects need not be included when calculating compliance with this Amendment.

Amendment C – Regulation

• Fast track Administrative Courts to resolve regulatory disputes shall be part of the judicial branch of the federal government.
• All federal regulations must state the exact language of the law(s) that authorize them. Administrative Courts must invalidate or require amendments to any regulation if it lacks standing in law.
• Rulings of an Administrative Court may be appealed to the Federal judicial appellate courts to and including the US Supreme Court.

Amendment D – Federal Trust Funds

• Social Security Retirement, Social Security Disability, Medicare, and possibly other funds shall be designated Federal Trust Funds, each to be separately and independently managed by a Board of Trustees of at least seven members required to comply with all of the Federal pension and trust laws.
• Congress will provide appropriate annual funding to properly administer and manage each Federal Trust Fund.
• Congress shall define in law the amounts beneficiaries must contribute to each designated Federal Trust Fund but may not designate the financial benefits to be received.
• Each Federal Trust Fund must be maintained in a separate account at the Federal Reserve Bank in Washington, D.C., and shall be independently audited annually.
• For 25 years from the date this Amendment is ratified Congress will guarantee to Social Security and Medicare recipients that their monthly benefits will be no less than they would have received under the systems in effect immediately prior to the adoption of this Amendment.
• Congress may appropriate funds to, but may not withdraw funds from, any Federal Trust Fund.
• Amounts owing by the Treasury to Federal Trust Funds must be repaid first before any other federal debt reduction.

Amendment D –Accounting

• All branches, departments, and agencies of the Federal Government, including the Federal Reserve must utilize generally accepted accounting principles in their accounting records.
• Generally accepted accounting principles shall be established by an independent Federal Accounting Standards Board consisting of at least seven well qualified members. The Board will be funded by Congress annually and administered by The Financial Accounting Foundation.
• Neither Congress nor any federal department or agency will pass any law or regulation that requires or permits any accounting treatment for any purpose that conflicts with generally accepted accounting principles as promulgated by The Federal Accounting Standards Board.
• All branches, departments, and agencies of the Federal Government must be audited no less frequently than annually by an independent outside public accounting firm and must publish audit results on the Internet within 120 days after the close of each fiscal year.
• Any department or agency that receives less than an unqualified audit opinion shall, on the first occasion have their ensuing fiscal year funding reduced by 10%, and on each subsequent occasion by 25%, of the amount they expended during the immediately past fiscal year.
• Congress may waive for a period not to exceed one year the funding reductions required by this Amendment.

Such a package of comprehensive financial management amendments to the U.S. Constitution could be enacted by Congress and sent to the states for ratification, the same process used in ratifying all 27 existing amendments to the Constitution. We should accord Congress every opportunity to adopt them, though it is unlikely that Congress will reform itself, so we must be ready to proceed another way.

Recognizing that Congress may be unwilling to stop runaway spending, citizens’ groups have formed calling for a Convention of The States, utilizing Article V of the Constitution, thus bypassing Congress when they are unwilling to support a particular amendment. Two thirds (34) of the states must agree to call the convention. The proposed Amendment(s) that result from a Convention of The States must then be ratified by 75% (38) of the several states, just as is the case with Amendments adopted by Congress.

One prominent example of an initiative by a citizens’ group is the so-called Balanced Budget Amendment, requiring the federal government to balance expenses and revenues. This group claims 28 states have signed on, with only 6 more needed. It is important that we persuade advocates of the Balanced Budget Amendment to support a comprehensive solution such as the one presented in this proposal, not just to limit spending.

There are two principal objections offered by proponents of The Balanced Budget Amendment to a more comprehensive solution such as the one offered in The Bill of Financial Responsibilities…

• Attempting to solve other federal government and financial issues is too confusing and risks the possibility that a Convention of The States may become an uncontrolled feeding frenzy of other matters that may not be in the nation’s best interest to adopt.
• The US Constitution should not contain minute detailed instructions about Federal Government operations and should instead stick to principles and overarching imperatives, leaving interpretations and more specific implementation to elected representatives.

As to the first of these objections, amending the Constitution is supposed to be difficult, to prevent frivolous misuse of the amendment process. There has to be a real need for change, big enough to awaken the public and get our attention. Typically, that involves a crisis of some sort. A crisis is a catalyst for change, leading former Obama Chief of Staff Rahm Emanuel to say, “never let a serious crisis go to waste”.

Most agree that runaway federal spending and our huge cumulative national debt qualifies as the kind of crisis to arouse citizens to strive for a Constitutional Amendment to fix it. But a crisis is also an opportunity, maybe the only opportunity, for an effective, comprehensive solution. We must not let this deficit and debt crisis go to waste. We had better get it right and solve the whole problem.

As to the risk of a runaway convention, a number of the states have already dealt with this potential problem by including language in the laws authorizing their participation in a Convention of The States limiting their delegates to approving only those amendments their state legislatures have authorized them to approve and no other business. Florida, for example, will withdraw its participation in the event the Convention seeks to act on any matters other than those that delegate is specifically authorized to approve.

Finally, the results of the Convention of The States must be ratified by 3/4 of the states, 38 states to be exact. That is a high bar in even the best of circumstances, so if the Convention misbehaves it is unlikely to win over such a super majority of our states and our people.

The second objection is that the US Constitution ought not be too specific in instructing Congress how to conduct its business. But if the situation to be repaired by the Bill of Financial Responsibilities is the behavior of Congress the Constitutional instruction must be unambiguous, comprehensive, and very detailed or it will simply not accomplish the outcomes intended by the people who ratified them.

Mr. John H. Ramsey is the author of the Bill of Financial Responsibilities and the founder of this campaign. Mr. Ramsey is currently a Senior Fellow at the Reason Foundation. Mr. Ramsey will serve as the Chief Executive Officer of the project. In addition, he is currently is researching and writing a book and will be speaking in public as a concerned citizen to help lead this national campaign and secure sufficient sponsorship.

For three years of almost a decade of government service, Mr. Ramsey was a project manager in a multi-billion-dollar defense weapons system acquisition. He also directed a major analysis of return on investment and progress payments for Deputy Secretary of Defense David Packard and the Defense Department’s Industry Advisory Council. Over a successful forty-year financial management career in business and government John Ramsey has been a successful chief financial officer of two companies, the first in food and consumer products manufacturing and the second in commercial and international banking.

He started his own company and it was successful on a global scale. He earned a Master’s in Business Administration with Distinction from Harvard Business School. His biography appeared in Who’s Who in America for 15 years. Mr. Ramsey’s complete biography is attached to this proposal.

Millions of Americans are concerned about the financial state of our federal government and the failure of our elected officials to enact solutions. According to Gallup, Americans are now more than twice as likely to identify themselves as conservative rather than liberal on economic issues, 46% to 20%.

Dr. Emily Ekins, PhD, Director of Polling at the Cato Institute analyzed the 63 million Donald Trump voters in the 2016 election and determined that approximately 56% of them, totaling 35.3 million voters, could be classified as either staunch conservatives or free marketeers. Both groups share an overwhelming opposition to tax hikes, increases in government spending, and the proliferation of business regulations.

Millions of our citizens seek action. The Article V process is underway. But there is no comprehensive solution around which to coalesce their efforts. The Bill of Financial Responsibilities to The U.S. Constitution recommended here will offer the first comprehensive, constitutional solution to the nation’s fiscal difficulties, all of them. This initiative will provide that solution and reach those millions of people with specifics.

We propose to:

• Raise $2 million initially, and more later as the initiative gains strength and scope.
• Recruit distinguished American citizens to serve as a Board of Advisors.
• Build support and endorsements from affinity groups for each part of the Amendment, and hopefully by challenging these groups to think and act outside their stovepipes, build support for the package of amendments as a whole solution. Target groups will include…
  
  • SPENDING AND WASTE
    • CITIZENS AGAINST GOVERNMENT WASTE – more than 1 million members
  • TAXATION
    • AMERICANS FOR FAIR TAXATION – 800,000 supporters
    • AMERICANS FOR TAX REFORM – 60,000 members
    • NATIONAL TAXPAYERS UNION – over 362,000 members nationwide
  • ACCOUNTING
    • AMERICAN INSTITUTE OF CPA’S (AICPA) – 418,000 members.
    • FINANCIAL ACCOUNTING FOUNDATION
    • FINANCIAL EXECUTIVES INSTITUTE – Financial Executives International is a network of more than 10,000 best-in-business financial professionals.
  • SOCIAL SECURITY AND MEDICARE
    • NATIONAL COMMITTEE TO PRESERVE SOCIAL SECURITY AND MEDICARE – millions of members and supporters
  • SPENDING AND WASTE
    • CENTER FOR RESPONSIVE POLITICS

• Petition every state supporting a Convention of The States to adopt a resolution in support of The Bill of Financial Responsibilities. We will begin with Florida and Texas. Efforts will include professional lobbying and testimony before relevant committees of the legislatures.
• Communicate with Members and Former Members of Congress in case some of them may wish to support the Amendment.
• Write, publish, and promote a book tentatively entitled WE THE PEOPLE AND OUR MONEY; WHAT WE MUST DO TO FIX OUR FEDERAL GOVERNMENT.
• Conduct a continuous and extensive national public speaking campaign in support of The Bill of Financial Responsibilities. The public speaking program will be aimed at meetings and conventions of various professional and advocacy groups nationwide. All speaking engagements will offer audiences…
  • opportunities to buy autographed copies of the book
  • sponsorship opportunities
  • information on connecting with the social media sites in support of the Amendment

• Establish and maintain a comprehensive social media campaign with the objective of reaching millions of Americans and building a regular audience for the project’s activities, as well as showcasing the growing progress and support for the Amendment.
• Seek support from members of powerful national organizations who can help find effective solutions. Among these groups are…
  • ALLIANCE OF RETIRED AMERICANS – 4.3 million members
  • AMERICAN ACTION NETWORK – 355,000 followers
  • AMERICAN CONSERVATIVE UNION – an umbrella organization of numerous conservative organizations nationwide
  • AMERICAN ENTERPRISE INSTITUTE – a Washington think tank
  • AMERICAN SOCIETY OF ASSOCIATION EXECUTIVES – 39,000 individual members represent more than 28,000 association executives and industry partners representing 7,400 organizations. Our members manage leading trade associations, individual membership societies and voluntary organizations across the United States.
  • ASSOCIATION OF MATURE AMERICAN CITIZENS – a membership of 1.1 million
  • CATO – a Washington think tank whose publications are downloaded from Cato.org more than 4 million times annually.
  • CLUB FOR GROWTH – over 100,000 members
  • CONVENTION OF STATES and COMPACT FOR AMERICA – millions of people dedicated to convening an Article V Convention of The States
  • FREEDOM WORKS – over 6 million Americans
  • GOVERNMENT FINANCIALS OFFICERS ASSOC – more than 19,000 members
  • THE HERITAGE FOUNDATION – Influential Washington think tank. 500,000+ members
  • NATIONAL CONFERENCE OF STATE LEGISLATURES – 7,383 state legislators in the United States plus staff
  • NATIONAL INSTITUTE OF PENSION ADMINISTRATORS
  • USA NEXT – 1.5 million+ members

• Market to public and private foundations known for their advocacy of constructive change in the federal government to better manage financial resources.
  Among these groups in addition to The Reason Foundation, are…
  • CONCORD COALITION
  • GATES FOUNDATION
  • THE CHARLES KOCH FOUNDATION
  • THE PETER PETERSON FOUNDATION
  • NO LABELS
  • THE TAX FOUNDATION
    TEXAS PUBLIC POLICY FOUNDATION
  • USA FACTS.ORG
  • DUNN FOUNDATION

No doubt this effort to amend our Constitution will take several years to accomplish.

Advocating and promoting this Amendment and the solutions it provides will be Mr. Ramsey’s full-time endeavor for the next few years. We therefore seek long-term relationships with sponsors and supporters to help make our partnership a big success for all parties and to accomplish ratification of The Bill of Financial Responsibilities as Amendments to the United Sates Constitution.

Following is the project budget for the first funding amount of $2 million. The budget is designed to enable substantive work to begin during the process of fundraising so that hopefully project outcomes will enable the growth of enthusiasm and support.

This budget is intended to finance significant operation during the first two years. A new budget will be developed for continuation of the campaign beyond two years or to accelerate operations if additional financing is obtained sooner.

To ensure effective governance, we will form Boards of Advisors and/or Boards of Directors to ensure that the project is properly managed and funds from donors and sponsors are effectively utilized in support of project goals.

Donors will make their gifts payable to the Reason Foundation, an established 501(c)(3) tax exempt organization, earmarked for The Bill of Financial Responsibilities project, thus enabling donors to deduct their gifts as a charitable contribution. Reason Foundation officials will serve as the fiscal agent to ensure that all activities of The Bill of Financial Responsibilities project supported by donor funds conform to the requirements of their 501(c)(3) status.

Sponsorship payments will be payable to The Bill of Financial Responsibilities, LLC, an organization that can engage in issue advocacy that therefore does not enable supporters to deduct their payments from their income tax as a charitable contribution.

This is an especially attractive opportunity for sponsors. The extensive program of communication, marketing, and persuasion that will be undertaken will enable us to reach millions of American citizens through mass media, as well as millions of members of professional and affinity groups through targeted outreach.

Founding Benefactors who will be asked to make one-time gifts at the project outset. The other categories of sponsorship packages are for three years. The prices quoted below are for each year.

SPONSORSHIP CATEGORIES, BENEFITS, AND PRICE PACKAGES

FOUNDING BENEFACTORS –

HONORARY CHAIR – $1,000,000. The Honorary Chair will be named in all publications and project materials and will include naming rights for the project.

FOUNDING BENEFACTOR – $500,000 Founding Benefactors will be named in all publications and project materials.

ADDITIONAL SPONSORSHIP CATEGORIES –

ARCHITECT OF FREEDOM – $75,000 ($25,000 PER YEAR)

CONSTITUTIONAL PATRIOT – $60,000 ($20,000 PER YEAR)

DISTINGUISHED SPONSOR – $45,000 ($15,000 PER YEAR)

PARTNER FOR CHANGE – $30,000 ($10,000 PER YEAR)

Benefits to be provided to these four sponsorship categories are outlined in the table on the following page.

We seek corporate sponsors interested in associating their quality brands with what we know to be the most important financial management initiative in the history of our federal government.

Now is the moment for We The People to get this right. The crisis is here. The solution is ready. May we meet and discuss this?