Yesterday was the deadline for filing your 1040 to the IRS and I had wanted to write about taxes in general, but the Notre Dame fire happened and it just seemed inappropriate to do so on a day when people’s minds were focused on the loss of a significant piece of World History.
I have often wondered how people would feel if they were called to serve on a jury and the case was one which involved an individual who was accused of income tax evasion; would they be more inclined to render a guilty verdict, or would they be more inclined to render an innocent verdict? I know for a fact that if I were to ever serve on a jury for a tax evasion case, the accused would NOT get a guilty verdict from THAT jury.
Did you also know that a graduated income tax is one of the planks of the Communist Manifesto? Well it is. According to the latest changes to the tax code the current tax rates begin at 10% and end at 37% for the wealthiest among us. That is exactly what is meant by a graduated, or progressive income tax, with the more you make determining how high a tax rate you pay.
Did you know that for 124 years our country existed without a tax upon the income of the people living within the United States; yet it functioned pretty well without it. Did you know that taxes almost led to the dissolution of the Union in the 1830’s, and it, along with the North’s interference in the institution of slavery, did cause 7 of the Southern States to secede from the Union in 1860? Taxes were also among the reasons why the Colonists chose to secede from the British Empire in 1776.
So, as you can see, our country has a history of having people who resisted attempts by their government to impose heavy and burdensome taxes upon them. Yet today we have been brainwashed into believing that paying our fair share is our patriotic duty.
There are many kinds of taxes you can pay, income tax, sales tax, excise tax, property tax, and capital gains tax being but a few of them. But if you dig down a bit you will find that taxes fall into one of two categories; they are either direct taxes or indirect taxes.
Without getting too complicated, a direct tax is one in which the tax is paid directly to the government by the person who the tax is levied upon; such as is the case with the income tax. An indirect tax, on the other hand, is collected by an intermediary and then paid to the government; such as is the case with a sales tax.
When the constitution was ratified in 1789 it was quite clear on the fact that all direct taxes must be apportioned; meaning that they were to be divided equally among the people of the country, or the States. So, if the federal government were to levy a $1,000 tax upon the State of Virginia, and there were only 1,000 people living in Virginia, each person would pay $1. With a graduated, or progressive tax, the lowest income earners might only pay $.25 while those earning the most might pay $2.50. The constitution, as ratified in 1789, prohibits such a tax, and the only way around that was to amend it allowing Congress to enact a graduated tax upon whatever source of revenue they could get their hands upon; hence, the income tax.
During the Civil War Congress made many attempts at imposing some sort of an income tax but they were always either rescinded or ruled unconstitutional; such as was the case when the SCOTUS ruled against them in Pollock v. Farmer’s Loan and Trust Co in 1895. Up until that point the income of the people was off limits to government tax collectors, but it was a source of revenue that was simply too tempting to keep it that way for long.
For years, most of the revenue flowing into the treasury came from tariffs, excises and duties assigned to goods purchased abroad. If you’ve ever flown to another country you will recall that some goods are sold duty free, while others you have to claim upon re-entering the U.S. so that it can be determined whether or not you are required to pay a duty upon what you bring back into the U.S.
As the government began to grow beyond its constitutional authority it needed an ever increasing supply of revenue to fund its operations. As tariffs were among the primary sources of income for the government, they began to rise; making the cost of purchasing certain goods beyond the reach of the lowest income earners. The 16th Amendment, (even though I personally believe it to have NEVER been ratified properly) promised that whatever taxes were imposed would make the rich pay their fair share while easing the burden upon the lower income earners … and for awhile it did.
But the thing about government is that once you give it a power, it ALWAYS seeks to expand that power; and this is no less true when it pertains to the power of taxation. You give government an almost unlimited power to tax and it WILL seek to tax everything under the sun.
When our government first went into effect there were two trains of thought regarding the purpose government should serve; and they formed the basis for the formation of the two political parties we have today. One camp, those who aligned with the beliefs of Thomas Jefferson, felt that government should limit itself to the specific powers found within Article 1, Section 8 of the constitution. The other camp, led by Alexander Hamilton, felt that government should be used to help grow the American economy; to create a great American empire.
To achieve their goals, the followers of the Hamiltonian way of thought had to impose high protective tariffs to protect American businesses and industries. Whether you choose to accept this or not is entirely up to you, but this was the ultimate cause of the Civil War; for when those tariffs became such a nuisance, or burden, upon the South, they chose to secede, and when Abraham Lincoln saw that the majority of the taxes flowing into his government was no longer there, he HAD to go to war to regain control over that stream of revenue.
Are you aware that by the time Thomas Jefferson had served 4 years as president that taxes were so low that, during his Second Inaugural Address he was proud to say, “What farmer, what mechanic, what laborer ever sees a taxgatherer of the United States?”
In researching for this article I stumbled across an article that said, “The U.S. government was capable of paying for its expenses without an income tax prior to 1913 largely because it had fewer responsibilities. Thomas Eddlem noted in The New American, that the federal government’s responsibilities were limited to basic operational matters and did not include such modern expenses as social insurance programs, welfare programs or agricultural subsidies.” (Source: https://pocketsense.com/united-states-government-funded-prior-income-tax-12769.html)
My jaw almost hit the floor when I read that; “such modern expenses as social insurance programs, welfare programs or agricultural subsidies”? Has the constitution been amended to include those ‘responsibilities’ as being among the powers given government? This is one of the most difficult concepts I’ve tried to get people to understand. I hear from people all the time that Congress enacted this law or that law, giving the government this power or that power which requires more and more taxes to fund. Well good for Congress, they passed a law. But by what authority did they pass that law?
The fact that Congress passed a law means absolutely nothing to me unless that law is in pursuance of the specifically enumerated powers found within Article 1, Section 8 of the constitution. Anything beyond that, no matter what justification they provide for it, is unconstitutional.
You see, this is the logical conclusion of following the Hamiltonian line of thought, that there are hidden or implied powers within the constitution, that the general welfare clause can be applied to everything that affects the lives of the people, and that the necessary and proper clause can mean anything the government feels is necessary and proper.
It all boiled down to what is meant by the word necessary. Jefferson took a strict position on it, meaning he felt that the Congress could only enact those laws which were absolutely necessary to serve the specific powers given Congress. Hamilton took a looser position, meaning that if it served the overall public good it wasn’t essential that it be absolutely necessary.
This battle over the meaning of the necessary and proper clause first arose in the battle for the First National Bank during the administration of George Washington. Congress, which was predominantly populated by acolytes of Alexander Hamilton, had passed a bill authorizing a central bank. Jefferson’s only hope to stop it was to convince the President not to sign it. Jefferson lost that battle when Washington signed the bank bill into law; setting the precedent for future loose interpretations of what is considered necessary and proper, or in the general welfare.
Prior to the constitution even being ratified, Thomas Jefferson wrote a letter to Edward Carrington wherein he said, “The natural progress of things is for liberty to yield, and government to gain ground.”
At the same time Jefferson wrote those words a fierce war of words was going on in the country over whether or not to adopt this new system of government that was presented to them by the delegates of the Philadelphia Convention of 1787.
A great many wise and prominent men opposed the proposed constitution; among them being George Mason, Patrick Henry, Samuel Adams, Robert Yates, and Elbridge Gerry. These were all men who had been considered patriots during our war for independence, and yet they were now fighting to preserve the liberty they had just fought a war to obtain against what they saw as the stepping stone towards an American despotism in this new constitution.
To truly understand the constitution you cannot base your opinions upon what you currently think your government is supposed to be doing. Government has been exceeding its authority since before you were born and to base your opinions upon what you are accustomed to, or what you have been taught, as this allows you to be indoctrinated into accepting a system of government that continually seeks to expand its power and restrict your liberty.
No, to understand the constitution you have to study the period when it was ratified; the arguments for and against it, and what was said during the ratification debates of the various states. To truly understand the constitution you have to learn what the people were promised it would do, not from the perspective of one who was born into a world where their government has been exceeding its powers for over 200 years.
That’s what I’ve been doing for the past month or so, reading the papers written by those who opposed ratification of the constitution. What I have found is that they were rightfully concerned over this proposed system of government; for most, if not all of the things they warned would happen, have happened.
The other night, as I was reading through the essays written by Robert Yates under the pseudonym of Brutus, I ran across his arguments against the constitution based upon the power it gave Congress regarding taxation. Brutus No. 6 caused me to stop numerous times so that I could highlight certain passages for future use. I would now like to share a few of those passages with you. Just remember, these essays were written prior to the implementation of an income tax, so you MUST view them from that perspective for the meaning to be clear.
Brutus begins by saying, “It was observed in my last number, that the power to lay and collect duties and excises, would invest the Congress with authority to impose a duty and excise on every necessary and convenience of life. As the principal object of the government, in laying a duty or excise, will be, to raise money, it is obvious, that they will fix on such articles as are of the most general use and consumption.”
He then goes on to discuss how taxes such as excises could affect cider; which was an alcoholic beverage, not the common apple juice we consume today, “An excise on this would raise a large sum of money in the United States. How would the power, to lay and collect an excise on cider, and to pass all laws proper and necessary to carry it into execution, operate in its exercise? It might be necessary, in order to collect the excise on cider, to grant to one man, in each county, an exclusive right of building and keeping cider-mills, and oblige him to give bonds and security for payment of the excise; or, if this was not done, it might be necessary to license the mills, which are to make this liquor, and to take from them security, to account for the excise; or, if otherwise, a great number of officers must be employed, to take account of the cider made, and to collect the duties on it.”
Brutus then goes on to discuss how excises might be applied to Porter Ale and other liquors, “Porter, ale, and all kinds of malt-liquors, are articles that would probably be subject also to an excise. It would be necessary, in order to collect such an excise, to regulate the manufactory of these, that the quantity made might be ascertained or otherwise security could not be had for the payment of the excise. Every brewery must then be licensed, and officers appointed, to take account of its product, and to secure the payment of the duty, or excise, before it is sold.”
I want to stop quoting Brutus for a moment to let you in on a little bit of history. Did you know that during the earliest years of our government the President and Congress enacted that same kind of excise tax upon whiskey, and that it led to a rebellion in the State of Pennsylvania? This rebellion led George Washington, at the urging of Alexander Hamilton of course, to lead an army into Pennsylvania to suppress. Although there was virtually no fighting involved in this Whiskey Rebellion, it proved one thing; that the government could, and would use force to compel the people into the paying of whatever taxes the government declared they must pay. Need I remind you that the Civil War was another example when Lincoln used force to keep the Southern States, and the money the government could pillage from them, in the Union?
Getting back to Brutus, he then writes, “This power, exercised without limitation, will introduce itself into every comer of the city, and country — It will wait upon the ladies at their toilett, and will not leave them in any of their domestic concerns; it will accompany them to the ball, the play, and the assembly; it will go with them when they visit, and will, on all occasions, sit beside them in their carriages, nor will it desert them even at church; it will enter the house of every gentleman, watch over his cellar, wait upon his cook in the kitchen, follow the servants into the parlour, preside over the table, and note down all he eats or drinks; it will attend him to his bed-chamber, and watch him while he sleeps; it will take cognizance of the professional man in his office, or his study; it will watch the merchant in the counting-house, or in his store; it will follow the mechanic to his shop, and in his work, and will haunt him in his family, and in his bed; it will be a constant companion of the industrious farmer in all his labour, it will be with him in the house, and in the field, observe the toil of his hands, and the sweat of his brow; it will penetrate into the most obscure cottage; and finally, it will light upon the head of every person in the United States. To all these different classes of people, and in all these circumstances, in which it will attend them, the language in which it will address them, will be GIVE! GIVE!”
Read that again. Go ahead, I’ll wait.
Does that not sound very similar to how we live today, with almost everything we do being taxed? That gas we put into our cars is taxed; the airwaves we use for our phones is taxed; the electricity we use to power our homes is taxed; our land is taxed; our income is taxed; our profits made from investments are taxed; and they even get us after we die when we leave our inheritance to our children with the estate tax.
All these taxes remind me of the old Beatles song Taxman, where George Harrison sings, “If you drive a car, I’ll tax the street/If you try to sit, I’ll tax your seat/ If you get too cold I’ll tax the heat/If you take a walk I’ll tax your feet/ Cause I’m the taxman.”
All this is the natural outcome of applying a loose interpretation of what is meant by the general welfare and what is necessary and proper; for had we stuck to a strict interpretation of those clauses there would have been no need to tax people on everything from their income to the water they use to brew their coffee.
All this has happened because people put their faith and trust in government to do what is best for them; what best serves the general welfare, or is necessary and proper. But as Brutus tried to warn people, “The government would always say, their measures were designed and calculated to promote the public good; and there being no judge between them and the people, the rulers themselves must, and would always, judge for themselves.”
In closing I would like to take a few moments to discuss a quote from the 1819 Supreme Court Case of McCulloch v. Maryland, “An unlimited power to tax involves, necessarily, a power to destroy.” It’s interesting to me that the SCOTUS would say that because what they were saying was that the power of a State to tax notes created by the First Bank of the United States could destroy that bank.
You see, that bank that I spoke about earlier that Hamilton and Jefferson had argued over, well it was responsible for issuing the currency notes, or money, that was to be used for paying for goods, services and debts. Well Maryland decided to impose a tax upon any notes that were not issued by a bank chartered in Maryland; meaning all Central Bank notes. The Supreme Court struck their tax down by exercising the supremacy clause of the constitution.
But that same quote can mean the same thing when the power of taxation is used by the government to create a nation of slaves who work and labor just to pay for a bloated and unconstitutional institution that uses that money to hire jack booted thugs to enforce laws which violate their liberty. Just look at the government we have today with all these agencies who can, and do use force against the people to enforce their laws. Doesn’t that sound exactly like what Lysander Spooner once described, “If any man’s money can be taken by a so-called government, without his own personal consent, all his other rights are taken with it; for with his money the government can, and will, hire soldiers to stand over him, compel him to submit to its arbitrary will, and kill him if he resists.”
And if Spooner was accurate in that assessment, there’s a high probability that he was also right when he said, “But whether the Constitution really be one thing, or another, this much is certain – that it has either authorized such a government as we have had, or has been powerless to prevent it. In either case it is unfit to exist.”
We pay our taxes for one of two reasons. Either we are foolish enough to believe that it is our patriotic duty to contribute our fair share towards the funding of our government, or we fear them coming after us if we don’t. If you’re among that first category of people then all my words have just fell upon deaf ears and I’ve just wasted two hours of my time. But if you’re among the last category, then I would like to ask you something, “Why do you insist on supporting a government you fear?”
A government that is supposed to be serving the public good should not instill fear into the governed. Now I know this quote was not made by Jefferson, but it remains true nonetheless, “When government fears the people, there is liberty. When the people fear the government, there is tyranny.”
I think we should be allowed to keep our money, and I believe that even more when I see my government doing things I do not believe it has the authority to do. But I suppose each of has to pick and choose their battles, and battling the IRS is not on my list of battles I wish to engage in. Maybe if I were a single old curmudgeon I would, but I have a family to consider and if I were to tell the IRS to take a flying leap at the sun then my family would suffer the consequences of my actions, and that’s something I don’t want them to have to suffer from. So I pay my taxes while I secretly pray for the day that the American people will pull their collective heads out of their collective asses and we can abolish this system of government that tyrannizes and oppresses the people of this country. Until then, I’ll let them keep milking me like a good sheep