Jun 02

Taxes and the death of the Republic


Taxes and the death of the Republic

by  theBushwhacker.com


If you are under the age of 30 pay attention.  Only your generation has the potential to change this destiny.  The rest of us wouldn’t do it. It’s up to you from this time on.  Remember, economics are fundamental to everything.

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the Public Treasury. From that moment on the majority always votes for the candidates promising the most benefits from the Public Treasury with a result that a democracy always collapses over loose fiscal policy always followed by dictatorship. The average age of the world’s greatest civilizations has been 200 years. These nations have progressed through the following sequence:”

From Bondage to Spiritual Faith
From Spiritual Faith to Great Courage
From Courage to Liberty
From Liberty to Abundance
From Abundance to Selfishness
From Selfishness to Complacency
From Complacency to Apathy
From Apathy to Dependency
From Dependency back into Bondage

From “The Decline and Fall of the Athenian Republic”
by Alexander Fraser Tytler Lord Woodhouselee (1748-1813)
(Scottish judge and historian at Edinburgh University)

As Ben Franklin descended the steps of Constitution Hall a lady asked him,  “What sort of government did you give us sir?”  He replied, “a Republic madam, ——–if you can keep it” I think he had read Lord Woodhouslee.  What do you think?

Slavery,” he wrote, “is a form, and the very best form, of socialism.” Fitzhugh Southern philosopher and advocate of slavery.  1849

The power to tax is the power to destroy.”  Daniel Webster 1782-1852.

The American income tax system is an instrument of servitude and was never compatible with a society of free people.   It is, however, the ideal instrument for funding a Socialist agenda and the coerced collection and spurious distribution of wealth.   The most glaring and evident example of this truth is the so-called Social Security system.  Here is the obvious model and mechanism of usurping the wealth of one demographic group, those who labor, by force of law and transferring it to another demographic group who do not labor by virtue of age.  This is forced servitude of one group for the benefit of another.  This circumstance has evolved negatively as the ratio of the group in service has dwindled in relation to the group that is served by 5 and eventually 2 or 3 laborers to one recipient.  A clearer and more compelling argument cannot be made.     This is the modern form of slavery.  It can be no other.

This relationship also clarifies the fatal flaw of a transfer system of funding pensions and retirement based on speculative assumptions of the future economic environment of the labor force versus an equity based system by which the individual participates in and accumulates the ownership of equity in the means of wealth production and the resulting revenue flow he or she can share in.  Simply stated, which is preferable?  The ownership of the productive labor of one person by another, or the individual ownership of the means of wealth production?  Which has the greater potential of certainty and endurance?  If the means of production fails, for whom does the laborer produce?  Does not the  ”factory” produce long after the laborer retires? If layer upon layer of retirees emanates from the factory how many times must productivity increase for the remaining workforce to compensate an ever extending retirement demographic that produces nothing?  If the economy is maintained which is best, the ownership of equity, or the ownership of each other?   Which is the true parasitic relationship?  Which party is the liability and which represents the asset to the overall economy?  Which individual drives the economy through genuine tax contribution and valid consumption and which bears the burden of redundant double or even triple payment?  Further, is a child born today to be regarded as a future economic liability or an ultimate asset?  If his retirement is funded by personal ownership of equity rather than dependence on the labor of others the answer should be obvious to all but the ambitious demagogue or the fool.

Freedom: noun; the responsible exercise of individual authority. theBushwhacker™ (Why is this seemingly trite definition of freedom important?  Because whenever the State usurps any portion of responsibility  for the individual or any group of individuals it must also usurp that portion of authority necessary to discharge that responsiblity and with that authority goes freedom.  For personal authority is the very essence of freedom.  Without personal authority we have nothing.  We are then slaves to the men with the guns.  “Pollitical power grows out of the barrel of a gun” Mao Zedong.  China.  The only legitimate duty of the State of a Free  people is not to usurp, but rather to enhance a facilitate the responsible exercise of individual authority.  This particularly includes economic authority and responsibility.  Economic integrity empowers individual responsibility. ) 

This is the standard by which all law must be measured.  In 1821 Jefferson stated that all authority rested with the people.  This was reflected in his Declaration of Independence in the keyword “consent”.  Any law that does not serve the establishment of justice can only be an instrument of tyranny and intimidation.  Any law that only serves expediency can never serve justice.  The duty of the state of a free people is to enhance and facilitate the ability of the individual to exercise responsible authority over him or herself. Not to usurp such responsibilities and authorities and the freedoms they represent.

The Bill of Rights was a set of Amendments to the Constitution by which the sovereignty of the individual was to be guarded against intrusion by the power of the State.  It was intended to forestall policies that create an adversarial relationship between the innocent citizen at large and his government.  The income tax amendment is contrary to this purpose.  It was unconstitutional on its face.  Indeed, it required a special amendment to the Constitution to qualify it as “Constitutional” and enter into law as enforceable.  As such it became an instrument of servitude and expediency that has no legitimate place in the business of our country.  Its force trumps other protections contained in the Bill of Rights and natural laws presumed to protect the innocent at large.  It has become an extortion against liberty.

Examples of Amendment and fundamental rights violation:

The 4th Amendment: The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Be aware that by doing nothing to comply with the disclosure requirements of the State you have committed a crime.  This is a crime of inaction, noncompliance and disobedience to the State for which you can loose everything you “own”.

The Income Tax Amendment allows presumptive ownership by the State of all earnings of the individual arising from his activities and requires involuntary affirmative compliance and response which may result in self incrimination (a 5th Amendment violation) and is an extortion against the right of security against unreasonable searches and seizures. Further, failure to comply with the demands of the state may result in severe penalties and even imprisonment.  Does this not speak to the presumptive primary ownership by the state  of the product of production by the individual?  

The 8th Amendment: Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.

The penalties for failure to file income tax forms can be highly disproportionate to the principle owed and accumulate interest as long as they endure.  Where else and against what violations can such aggressive penalties be imposed except here?  Such failure can be and often is interpreted by the State as deliberate evasion of the duty imposed by the state to render that portion of production assessed by the State.  Since there is no way to reliably determine the actual tax liability to the State this can only be an arbitrary and spurious liability.  But the burden of proof, unlike common criminal law, is not on the State, but on you to prove your innocence for failure to “voluntarily” comply.  (Warning: the EPA can also impose such draconian penalties, as can other bureaucratic agencies.)  

The 13th Amendment: Sec.1. Involuntary Servitude.  Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction. (Think of the irony of this Amendment.  You can become a criminal by simply ignoring the compliance demands of the State.  And what do we now suffer under as the consequences of the self serving elected or appointed officials and bureaucrats  who formulated these laws and the bureaucracies who enforce them by regulations that carry the force of law? And what has become of the wealth they consumed and for what?)   

Here is where the most obvious infringement of liberty can be brought into focus.  The State can take as much or as little of the peoples “earned” income as it’s arbitrary and voracious appetite desires and distribute it to whomever it determines it has expedient favor to cull.  This is how the incumbents in both Houses curry favor with their constituents and keep themselves in power, sometimes for decades.  This is the essence of involuntary servitude.  It is as ancient as civilization itself.

Our current system of taxation has long outlived its usefulness and must soon be replaced with one that is more compatible with a society of free people.  The income tax is now composed of thousands of rules and regulations that few if any citizens or even our Congressional representatives nor professional accountants can understand in part or in whole much less comply with.  Further, in the hands of a dominate political party the codes can be used for political reward or punishment.  They may also be used to intimidate or destroy targeted enterprises and their owners for any number of reasons.  Its most favored purpose is its ready application facilitating liberal or socialist agendas for “redistribution of wealth” according to the political discretion of powerful interests within or influential parties in proximity to the instruments of government.  It permits the intrusion of questionable government interests into the affairs of virtually anyone at large in society.  The adversarial relationship that has been created between the state and the citizen at large has grown to unacceptable proportions and must be redressed.  It threatens our economy, retards opportunity, consumes extraordinary resources in compliance costs (*approximately 20% of receipts each year)   and bureaucracy, and produces no wealth in the process.  It is a parasite that needs expulsion from the workings of a modern free and productive nation.

To that end, we must look at alternatives that better and more efficiently facilitate the needs of a society of free and independent citizens and the government  whose duty is to serve them facilitating their ability to exercise responsible authority over themselves.  The best model to emerge to date seems to be the FAIR TAX initiative.   Unfortunately the current income tax system is deeply embedded within the mechanisms of our government and resistance to a new paradigm will most likely prove intimidating and ineffective.  However, we must call out the truth and obvious defects at play.  The most succinct and clarifying description is this:  the income tax is an instrument of involuntary servitude.  It is most compatible with a socialist mechanism of subjective wealth collection and arbitrary redistribution. It incorporates powers that are intimidating to the otherwise innocent at large and therefore constitutes an extortion against liberty.  The best alternative is the so-called Fair Tax which might more aptly be labeled the Freedom Tax.

The Fair Tax would eliminate the need for all income taxes and hidden taxes and replace them  with a national sales tax the cost of which would be posted on every receipt just as it is now.  It would necessarily be higher than current sales taxes.  However, the elimination of hidden taxes would reduce the retail and hidden prices considerably and overall prices would be very nearly the same and in many cases less than they are now.  Also, they would be applied only on new production of goods and services at the retail level and not on second hand or previously owned items or housing and automobiles.  The citizen at large would pay no taxes except when accessing the retail market.  What ever he earned he could keep.  He would pay taxes only on what he decided he could afford to consume.  He would receive a “pre-bate” at the beginning of each month to cover taxes on essential necessities for himself and his family.   He would (eventually) no longer be forced to forfeit any portion of his earnings to support any party in another demographic group, such as Social Security or F.I.C.A tax.   What remains of Social Security will inevitably become an obligation of the General Treasury.  (This has already begun.) 

Indeed, all retirement funding and pension mechanisms must be equity based and funded at the outset, even at birth.  Indeed, at the present, every child born it our society becomes an immediate and inevitable economic liability to the State and the economy.  Pre-funding retirement with equity would remove this liability and turn the child into an economic asset to the nation in his or her old age.  This would eliminate the need for entitlement funding and further taxation for such over time.  Such government sponsored retirement funds might very well be established for each child within the first year of life and funded within a tax exempt Roth type IRA. With an initial contribution of $12,000 (from a loan from the Treasury) combined with investment into an S&P 500 type fund would grow to over $1 million to $2 million at age 65 ($1,700,000+ at 8.0% per year) thus making every child an ultimate economic asset to society rather than an eventual liability. ( Note: The average Social Security recipient currently receives over $12,000 per year.  This payment continues and increases year after year until death. The above estimates are based only on a one time loan to the birth IRA of the same amount.) Such individuals choosing marriage could almost double their retirement equity even if they had made no more effort to increase their personal wealth during their lifetimes.  They would only be required to repay the initial funding upon entering the work force through contributions from family sources, service opportunities such as a four or five year military or public service tour, or direct repayment at low interest.  The debt obligation could also be satisfied by diverting the employe’s portion of his FICA obligation, if retained for  a period of time, to the debt as well.  These things would of course require modification of the FICA mission.

If the requirement was to repay the Treasury loan by the age of 30 or 35 years of age at, for example, at a .5% to 1% annual charge at that time the system would become self funding as the repayments were revolved into the trusts of children then being born.

At the end of life, and if married, the survivor would inherit the entire remaining contents of the deceased’s trust to maintain the survivors life needs.  Upon the death of the survivor their progeny, if any, would inherit the remains into their trusts thus growing the wealth of families into the future for generations to come.  The need for government sponsored entitlement programs would fade into the dustbin of history along with the tax burden required to fund them.

This approach would endow every individual at birth with direct and protected ownership of his or her economic destiny through equity and restore his personal sovereignty, and that of his progeny, as  free citizens.  The people, as individuals, would then directly own the means of wealth production and distribution of the domestic and even international economies but in common with each other.  Goodbye Karl Marx. Hello the legitimate uses of Capitalism.

I have no patience with fools or nay-sayers.   It you have a better or more reasonable, efficient and certain pathway to funding retirement for the free individual register and post it here.
theBushwhacker ©2012 and prior.

- theBushwhacker

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