Can this statement
possibly be true? In order to answer this question, Americans must first
understand what is the source of the money that funds the government
and where it goes. Contrary to the sound bites issued by the two mainstream
political parties, the reality of how the system actually works will
not only open your eyes, but hopefully stimulate the American people
to demand that the thievery underway come to an end.
Where do your "income" tax dollars go?
The best place to
look for an answer to this question would be a government report, so
let's take just one at random:
President's Private Sector Survey On Cost Control
A Report to The President (Reagan)
January 15, 1984.
Available from the Congressional Research Service.
The excerpt below can be found on page 12.
"Importantly, any meaningful
increases in taxes from personal income would have to come from
lower and middle income families, as 90% of all personal taxable
income is generated below the taxable income level of $35,000.
Further, there isn't much
more that can be extracted from high income brackets. If the
Government took 100% of all taxable income beyond the $75,000 tax
bracket not already taxed, it would get only $17 billion, and this
confiscation, which would destroy productive enterprise, would only
be sufficient to run the Government for several days.
Resistance to additional income
taxes would be even more widespread if people were aware that:
With two-thirds of everyone's
personal income taxes wasted or not collected, 100% of what is collected
is absorbed solely by interest on the Federal Government contributions
to transfer payments.
In other words, all individual
income tax revenues are gone before one nickel is spent on the services
which taxpayers expect from their government."
So what we have
is a central bank issuing worthless paper "money" that controls
our economy, our lives and our future. This private banking cartel was
unconstitutionally granted this power by a devious, scheming group of
senators back in 1913. In essence what they did was place the American
people into indentured servitude by forcing The People to pay usury
on worthless fiat currency (paper money created out of nothing), not
to fund the government, but to enrich the bankers and fund wars in which
America should never be involved. This system exists not to fund the
government, but to allow the U.S. Congress carte blanche power to continue
funding unconstitutional agencies and programs by providing them with
a bottomless source of worthless ink.
The National Debt and the Deficit
These two little
bookkeeping items are not the same thing. Few Americans actually know
the difference, but the difference is quite important. We continually
hear members of Congress, president after president, and political pundits
call for "reduction in the debt." But what does that really
mean? Here's how it works in the most simplified way to fit into this
Let's say that for
2002, Congress and the President decide they want $1.7 trillion dollars
to fund this bloated pig called our government. We know that 100% of
all personal "income" taxes extorted by the IRS goes to the
"Federal" Reserve Banking System and does not fund a single
function of the government. So, let's take the people's blood and sweat
off the table.
What other revenues
does the government collect? Corporate taxes, social security taxes,
constitutional revenues such as excise taxes on cigarettes, alcohol,
tobacco, firearms, tires, etc., tariffs on trade, military hardware
sales, and some minor categories. Let's say that those revenues will
total $900 billion dollars. The politicians want $1.7 trillion to spend
on their favorite welfare programs, wars and foreign welfare, but have
a short fall of $800 billion dollars. This is called the deficit and
the deficit, created by the spending of Congress, creates the "national
How? Because the
politicians are $800 billion dollars short, they simply call up Al Greenspan
and borrow your children's and grand babies' futures. The "Federal"
Reserve Banks don't loan anything of value to Congress. They aren't
banks; they're really an overpaid, powerful, private accounting service.
When that $800 billion dollars worth of ink is transferred to the Treasury,
it gets piled on top of the existing "national debt."
This is how the
magical money machine works. Congress overspends. It borrows from this
accounting firm called the "Fed" and then turns around and
tells you to pay for these crimes against the people. In other words,
Congress basically pays the bills with social security and borrowed
ink from the "Fed." Pretty slick scam, wouldn't you say?
The people of America
are also responsible to a large degree for this out-of-control spending.
Americans have been bred to a welfare dependent mentality. Special interest
groups who have no interest in the U.S. Constitution, demand that billions
of dollars be spent on their pet interests. Billions upon billions of
dollars have been unconstitutionally thrown to foreign governments,
some days our friend, a week later our enemies. They are only our friend
as long as the U.S. throws money at their corrupt governments.
Billions of dollars
have unconstitutionally been spent on grants to colleges and universities,
which in turn sell their research to the highest bidder, paid for by
the sweat off the back of the little guy out in America. No, they don't
return any back to the little guy who funded these studies and research
As long as the American
people themselves condone continued unconstitutional spending by Congress,
the longer they will violate their oath of office, and continue to fund
unconstitutional expenditures, placing your children and grand babies
in a state of unpayable, massive debt.
Unless The People
demand an end to this insanity, our economy eventually will collapse
under the weight of this massive, unpayable debt, no matter how much
ink the "Fed" transfers into the coffers of the U.S. Treasury.
The pain of withdrawal from unlawful government hand-outs will be far
less now than it will be down the road.
America became the
greatest, debt free nation on earth by a resourceful, independent, self
reliant people. Sadly, today we have a large percentage of our population
who can't get through the day without a government memo telling them
how, step-by-step, with a redistribution of average, ordinary Americans
assets into the hands of the unproductive. A very sad commentary to
what made our nation great and prosperous.
But I heard the debt is being paid down?
What you heard and
reality are two separate issues altogether. The politicians must continue
to fool the American people lest they catch on to this chicanery. Let's
have a look at the numbers so you can see that any utterance that the
national debt has been paid down X billions of dollars, is nothing more
than bombastic gas, passed from one administration to the next and the
latest recycled Congress.
In the chart below,
an R next to the amount indicates a Republican President; a D is for
a Democrat in the Oval Office. The Democrats had control of Congress
from 1954, until the illusion billed as the "Republican Revolution"
in 1994. Both houses of Congress were Republican controlled until after
the 2000 "election", but this ended when in May 2001 James
Jeffords 'fessed up to his real political agenda.
1.23.2015: $18,098,240,359,740. That's over $18 TRILLION dollars.
The thieves in the Outlaw Congress spend $121,067 per second everyday. They borrow $4,506,849,315 every day of the year from our enemies and through "creative" accounting.
The statistics above were obtained from the Bureau of The
Public Debt's web site:
As you can see, it doesn't matter which party is in office, there is
no surplus and the debt cannot be paid down, it can only grow exponentially
as long as Congress and the President have the central bank at their
budget" is nothing more than good political rhetoric, but in reality,
it's a pipe dream strictly for public consumption. How can you balance
your budget if you have no money to spend and are trillions of dollars
in the hole? You can't. It's just another well crafted illusion to keep
the masses pacified.
You can fool some
of the people some of the time, but the American people have awakened
to this monumental theft and are demanding the only real solution that
can be implemented: Abolishing the central bank, and a return to a constitutional
monetary system with no income tax.
No "Fed," no need for a direct tax
Without the central
bank siphoning off the wealth of our nation, there would be no need
for a personal income tax.
Jackson booted out the central bank; his speech can be read here:
This battle fought
by Jackson was a huge deal back then and he refused to back down. Jackson
was the last honest president with the guts to stand up to the international
bankers who are literally stealing US blind.
party battle of Jackson's presidency centered around the Second Bank
of the United States, a private corporation but virtually a Government-sponsored
monopoly. When Jackson appeared hostile toward it, the Bank threw its
power against him.
"Clay and Webster,
who had acted as attorneys for the Bank, led the fight for its recharter
in Congress. "The bank," Jackson told Martin Van Buren, "is
trying to kill me, but I will kill it!" Jackson, in vetoing
the recharter bill, charged the Bank with undue economic privilege.
won approval from the American electorate; in 1832 he polled more than
56 percent of the popular vote and almost five times as many electoral
votes as Clay."
Please note that
the words "a private corporation but virtually a Government sponsored
monoploy" comes directly from the White House's
web site. What a huge admission!
On line, you can
also read Congressman Louis McFadden's indictment
on the Federal Reserve Corporation. It is a very concise
explanation of how the international banking cartel has been sacking
this country's wealth since 1913.
Don't be fooled
by this chant around the country for a flat tax, a consumption tax,
sales tax or any other kind of personal income tax. There is absolutely
no authority in the U.S. Constitution to implement any of these forms
of taxation without apportionment. It is for this reason and this reason
alone, that when it became apparent that the 16th Amendment was not
going to be ratified by the states, fraud was committed and it was simply
"proclaimed" ratified by then Secretary of State Philander
We don't need any
direct taxation and these popular mantras are just new lies to replace
old lies. Any one of these forms of taxation will still feed the cancer:
the central bank. Any one of these forms of taxation is just another
way to fleece the American people to enrich the pockets of the international
banking cartel. Please consider the words of Congressman Ron Paul:
"Strictly speaking, it probably is not necessary for the federal
government to tax anyone directly; it could simply print the money it
needs. However, that would be too bold a stroke, for it would then be
obvious to all what kind of counterfeiting operation the government
is running. The present system combining taxation and inflation is akin
to watering the milk: too much water and the people catch on."
Please don't fall
for these alternative taxing SCHEMES. The banking cartel doesn't care
what form it is they fleece your hard earned dollars (flat tax, fair
tax, sales tax, etc.) - just as long as they continue to steal from
Make IRS check payable to stockholders of private Fed
Today is April 15 ... again
What we need to
do is take away the magical money machine called the "Fed,"
which will force Congress to live within its means and fund only those
activities specifically enumerated by the supreme law of the land in
Art. 1, § 8 of the U.S. Constitution:
Lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts
and provide for the common Defence and general Welfare of the United
States, but all Duties, Imposts and Excises shall be uniform throughout
the United States, borrow Money on the credit of the United States,
regulate commerce (trade), naturalization, bankruptcy laws, coin money,
regulate the value thereof, and of foreign Coin, fix the Standard of
Weights and Measures, punishment regarding counterfeiting the Securities
and current Coin of the United States, establish Post Offices and post
Roads, Promote [Editorial note: "promote" does not mean fund]
the Progress of Science and useful Arts, by securing for limited Times
to Authors and Inventors the exclusive Right to their respective Writings
and Discoveries, constitute Tribunals inferior to the supreme Court,
define and punish Piracies and Felonies committed on the high Seas,
and Offences against the Law of Nations; declare War, grant Letters
of Marque and Reprisal, and make Rules concerning Captures on Land and
Water, Raise and support Armies, but no Appropriation of Money to that
Use shall be for a longer Term than two Years, provide and maintain
a Navy, make Rules for the Government and Regulation of the land and
naval Forces; provide for calling forth the Militia to execute the Laws
of the Union, suppress Insurrections and repel Invasions, provide for
organizing, arming, and disciplining, the Militia, and for governing
such Part of them as may be employed in the Service of the United States,
reserving to the States respectively, the Appointment of the Officers,
and the Authority of training the Militia according to the discipline
prescribed by Congress, Exercise exclusive Legislation in all Cases
whatsoever, over such District (not exceeding ten miles square) as may,
by Cession of particular States, and the Acceptance of Congress, become
the Seat of the Government of the United States, and to exercise like
Authority over all Places purchased by the Consent of the Legislature
of the State in which the Same shall be, for the Erection of Forts,
Magazines, Arsenals, dock-Yards, and other needful Buildings, make all
Laws which shall be necessary and proper for carrying into Execution
the foregoing Powers, and all other Powers vested by this Constitution
in the Government of the United States, or in any Department or Officer
There is absolutely no authority for the federal government to legislate
in areas of the environment, education, the NEA, the FDA and many others.
It may surprise you to find out that agencies such as FDA, DEA and the
EPA all derive their jurisdiction from international treaties. When
the powers that be wish to circumvent the U.S. Constitution, they do
it either through an executive order or international treaties. We strongly
encourage you to investigate this issue thoroughly.
Prior to the Federal
Department of Education, America had the finest schools in the world.
Since this disastrous and unconstitutional grab for power, we can all
see that a quadrillion dollars a year will not fix our schools, and
they continue to decline faster than the feds or states can shovel money
into them. Even if a direct tax were necessary, only by keeping it at
its lowest possible percentage would it ever benefit this nation:
"The point now emphasized is that the evil effects of high surtaxes
fall not upon the individual whose income is seized and taken, but ultimately
almost entirely upon the mass of the people who are thereby deprived
of the benefits which would result from the free flow of commercial
transactions and the use of the additional capital which would be available
for productive enterprise.
"Freedom of business transactions essential.
to be obtained by the Government from this class of taxes depends upon
transactions in trade and commerce which bring about income available
for payment of taxes. It is highly desirable, in the interest of the
production of revenue, that the volume of business transactions giving
rise to gain shall be as great as possible, and to this end it is essential
that the natural laws of trade and commerce and the free flow of business
shall not be interfered with or prevented.
The excerpt below is from pgs 19-20, Annual Report of the Secretary
of the Treasury on the State of Finances for 1921:
"But the direct effect of these very high taxes is to hinder and
prevent business transactions which would otherwise take place. A man
may have property which he has held for years and which has greatly
increased in value, and he would like to sell it, but if he does a large
part of the gain would have to be paid out in taxes. He would rather
keep the property than sell it, pay the tax, and invest what is left
in something else. At the same time the party desiring to buy this property,
if he obtained it, would improve it with buildings.
What is the result?
The transaction does not take place, and the community loses the advantage
which would come in the stimulation that would arise from the transactions
resulting from the buyer's improvement of the property, and it also
loses the advantage of the seller's putting his money into some other
form of investment, which in turn would give rise to business transactions.
The same thing on a much greater scale is true in manufacturing and
mercantile lines. Men have built up enterprises to the point where they
are highly successful. They would like to take their profit and turn
the business over to younger men to carry on.
are highly desirable not only for the parties but for the community,
yet they are absolutely stopped, because if made the seller would have
to pay in one year a tax on a gain which has been the result of perhaps
the better part of a lifetime of effort. And in all such cases the Government
gets no tax, whereas if the rates were reasonable the transactions would
take place and the Government's revenues would benefit accordingly.
The free interchange
of property in business transactions is essential to the normal prosperity
of the country, and each such transaction has a direct tendency to bring
about others of like character with the result of increasing the amount
of gain or income available for taxation; but when the tax is so high
as to act as a deterrent against usual and desirable business transactions,
and the volume of such transactions is thereby lessened, the inevitable
result is for the tax to become less and less productive.
It is for these
reasons that, particularly in the higher brackets, a lower tax rate
will produce more revenue in the long run than excessive rates. So long
as the high rate stands in the way of accomplishing bargains and sales,
the Government receives no tax; but at a lower rate the transactions
proceed and the Government shares in the profits." (End of excerpt.)
Today Americans are being fleeced to the tune of approximately 52% of
every dollar going for local, state and federal taxes. The day is rapidly
approaching when making even $1,000 per hour will not be enough to survive.
How much longer are the people of this nation going to put up with this
state of affairs? We say enough is enough!
A Pioneer on the withholding issue
Vivien Kellems was
a woman before her time who knew the grand theft taking place against
the working man's paycheck. [For more information on Ms. Kellems, see: http://www.vivienkellems.org/].
The following excerpt from pages 41-46 of her book, Toil, Taxes and
Trouble, published in 1952 is legally right on point:
"Since a capitation means a tax of the same amount for every person,
this provision makes doubly sure that all federal taxes must be at the
same uniform rate for everybody. This limitation that direct taxes be
levied by the Federal Government must be in proportion to a census and
apportioned among the States in accordance with numbers, is the only
provision in the Constitution that is stated twice.
"The only reason that our Constitution required a census to be
taken every ten years was to count the people to determine how many
Representatives should go to Congress, and how direct taxes should be
levied. I wonder how many Americans thought of this in 1950 when those
little busybodies came knocking on their doors, asking ten thousand
impudent, silly questions which were none of their, or Washington's,
"There is absolutely no power granted in the Constitution which
enables a top-heavy bureaucracy of empty-headed simpletons, and worse,
to invade the privacy of the American people in such a monstrous manner.
This census is just a preview of what is really in store for us if they
actually take over, which they most certainly will do unless we uproot
and vote them out.
"The census was to count the people - that was all. The number
of people determined the number of Representatives in Congress and the
apportionment of direct taxes among the states.
"For a long time I asked myself, 'Why were Representatives and
direct taxes linked together and apportioned among the States in accordance
with population?' It was understandable that Representatives should
be chosen in accordance with numbers but why should taxes be apportioned
the same way? And then one day, out of the blue, it came to me crystal
clear. All at once I understood the plan to safeguard the future freedom
of the nation, conceived and executed by those scholarly men.
"I read again: 'Representatives and direct taxes shall be included
within this Union, according to their respective numbers...' 'No capitation,
or other direct tax shall be laid, unless in proportion to the Census
of Enumeration hereinbefore directed to be taken.' And in those two
sentences our forefathers bound fast the hands of Congress and secured
the liberty and freedom of the American people. How? By making it utterly
impossible to levy an income tax.
"An income tax is certainly a direct tax, probably the most direct
tax of all since it cannot be shifted but must be paid by the person
receiving the income. By specifying that direct taxes must be levied
in accordance with the number of people, not upon what they produced,
as in the days of ancient Egypt, an income tax was simply out of the
question. It cannot be levied upon a man but must be levied upon what
"Our forefathers designed and incorporated in the Constitution
a new system of government. It was built upon a revolutionary idea;
the conviction that the government belonged to the people and existed
only by their consent. Its genius lay in the careful system of checks
and balances among the three departments, the Legislative, the Executive,
and the Judicial. And it went further and maintained a balance between
the powers of the individual States and the Federal Government. In addition
it carefully reserved to the States and to the people all rights and
powers not specifically delegated, or prohibited to the Federal Government
and further stated that because certain rights were enumerated in the
Constitution it did not mean that others not mentioned were still not
the property of the people.
"However everything in the Constitution was arrived at by compromise.
The interests and concerns of the thirteen states varied widely and
each delegate was sent to Philadelphia to protect the commerce, industry
and agriculture of his particular state. It required months of patient
discussion, argument and forbearance to finally produce the finished
document, which when completed, comprised a system of government to
protect the people in the rights and liberties set down in flaming words
in the Declaration of Independence. It is a wonderful document, the
best system of government ever devised for human beings, but it could
have varied in some respects and still have worked satisfactorily......
"The supreme achievement of the combined brains of all those men
were written into those two sentences and the freedom and liberty of
the American people were secured in them. For in those two sentences
the right of the free man to own something was made inviolate. This
was his distinguishing mark, the only criterion of freedom in all the
world, the right of the common man to retain for himself the fruit of
Now this is how
it worked. Every man was given a vote with which he could vote for his
Representative. Originally only Representatives were elected, Senators
were appointed by the State Legislatures and it's too bad we changed
Note: We didn't. Like the 16th Amendment, the 17th Amendment is a fraud--it
was never ratified by the states. Therefore, we have not had a lawfully
seated senate since 1913.)
"That Representative having to stand for election every two years
was close to the people and responsive to their wishes. That is why
he was given the power to tax; all bills of revenue arise in the House.
And that is why he must come home every two years and give an accounting
to the people.
"But his power to levy direct taxes was limited by an ironbound
restriction: that tax must be apportioned among the States in accordance
with the population. Since all taxes were to be at a uniform rate, Congress
simply could not penalize one section of the country, or one group of
citizens for the unfair advantage of another.
"When Congress levied a tax, everybody had to pay and at the same
rate. The amount would vary with the wealth of an area, as it does today
with the different values of real estate, but the rate was the same
for all and the tax was distributed among the States according to population.
"The men who wrote our Constitution did not found a democracy.
They feared the so-called 'Democrats' of their day as much as we fear
the Communists today. They did not believe in mob rule, or government
by the unintelligent, irresponsible mass. They founded a republic and
they made certain that the right to vote should be curbed and controlled
by the necessity of paying taxes. Scheming politicians could not take
taxes from a helpless minority and buy themselves back into office with
the votes of the tax exempt majority. When a Representative voted a
tax, he voted to tax everybody because the tax was based upon numbers,
not upon dollars.
"This was the most brilliant plan ever conceived for guaranteeing
the freedom of a nation. It protected every person in his right to private
property, rich and poor alike, and under this protection we built the
richest, most powerful nation on earth. We achieved and maintained for
the majority of our people a standard of living undreamed of before,
the hope and the envy of the whole world.
"And we accomplished something even more important: we developed
a vigorous, self-reliant, self- respecting race of people. An American
citizen would have been ashamed to ask for a handout from his Government.
The Government belonged to him, he did not belong to the government.
"And then what happened? We chucked our carefully safeguarded right
to own something out the window, and we passed the income tax amendment.
Gone was our apportionment among the States in accordance with population,
and also gone was our principle of uniformity. Income 'from whatever
source derived, without apportionment among the several States, and
without regard to any census or enumeration' could be taxed and without
limit. And when we passed this income tax amendment the slow, distilled
poison of tax slavery dripped into our veins. We sowed the seeds of
our national decay which is rapidly coming to maturity before our eyes
today. The heritage of freedom so carefully insured for us by our forefathers
is gone; it has been taxed away." (End of excerpt.)
The "General Welfare" Clause of the Constitution
The majority of
unconstitutional spending is justified by the "general welfare"
clause of the constitution. Shawn O'Connor of the Free Enterprise Society
summed up this misconception in one of his speeches, paraphrased below:
of the general welfare clause of the Constitution by the courts relies
upon the Federalist Papers. This term simply means: Taxation was to
protect the individuals' life, liberty and ownership of private property.
One can go to Art. 1, Sec. 8, Clause 1 of the constitution and read
the general welfare clause. Then one can do some history research and
see what the Anti-Federalists had to say about this clause:
clause conveys absolute power to the central government. Patrick Henry
was very vocal in his opposition to putting this kind of language into
the constitution. Madison, however, assured Henry and others that all
the general welfare clause represented was a preliminary introduction
prior to the enumerating the specific powers the delegates were about
to grant to this new federal government and that the general welfare
clause granted no new power to the government whatsoever. It was simply
an introductory statement.
still weren't satisfied. Hamilton and Madison came back to re-state
that if the general welfare clause conveyed absolute power to the government,
why would they go on to list the specific powers they were going to
grant the government? That wouldn't make any sense at all if they were
going to give absolute power to this government. It was finally conceded
by all at the convention that the general welfare clause conveyed absolutely
no power to the government." [End of comment.]
The general welfare
clause of the constitution has been misused for personal gain by special
interest groups to enrich the pockets of the banking cartel, by politicians
hoping to "get that vote," and an all out push to turn America
into a socialist country, beginning with the "New Deal" implemented
by FDR and supported by a weak Congress. Lyndon Johnson took the quest
to turn America into a socialist nation to new and grotesque heights.
How would you fund the government without any direct taxation?
The powers that
be know it's just a matter of time before the truth reaches enough Americans
about the voluntary income tax system. Already trial balloons are being
floated to once again fool the people into some form of alternative
tax in order to feed the central bank.
very well without an income tax throughout the history of this Republic.
The answer to the question of funding without a direct tax is found
is Article 1, Section 9 of the Constitution since 1787. It provides
for Congress to pass a legislative bill for tax money to be paid by
each state in proportion to its population.
funding will allow large amounts of money to fund a limited form of
Republican government. To continue on the path of this massive and unconstitutional
spending will bring a final and total collapse of the economy. Make
no mistake about it.
Has your government been truthful?
Do you know why
the "withholding tax" system was put into place? Let me provide
you with just one shocking example of how things work behind the scenes:
Declassified (Confidential Committee Print)
Withholding Tax Hearing Before A Subcommittee of The Committee on Finance,
United States Senate, 77th Congress, Second Session on:
Data Relative to Withholding Provisions of the 1942 Revenue Act, August
21 and 22, 1942
(Printed for the use of the Committee on Finance)
United States Government Printing Office, Washington 1942
SUMMARY/Contents Statement of:
Friedman, Milton, Division of Tax Research, Treasury Department
Hardy, Charles O., of Brookings Institution
Jacobstein, Meyer, of Brookings Institution
Paul, Randolph E., Treasury Department
Because the war effort resulted in increased production and employment,
which caused a sudden large influx of money into circulation, the Federal
Government and Federal Reserve System had to find a method of "mopping
up excess purchasing power" thereby control inflation and obtain
immediate funds for the Treasury. Several plans were put forth before
the House, Ways & Means Committee and the Senate Committee on Finance
to accomplish this purpose.
The following points
were made by the Senators and those testifying before the committee:
1. The overall purpose
was to obtain immediate money for the war effort, to control inflation
and to get the income tax on a current basis instead of being one year
2. To accomplish
this goal, it was recognized that a scheme was needed to reach the largest
number of people.
3. That the scheme,
regardless of whether it was a "coupon," "stamp"
or "withholding of income tax at source," would constitute
a "forced loan" to the Federal Government and it would apply
to taxpayers and nontaxpayers alike, with exceptions.
4. Where an individual
had money withheld and ultimately no tax liability, the individual would
file an income tax return and that income tax return would constitute
an automatic claim for refund.
5. The proposed
plan was an emergency war time measure.
Beginning Page 99
Statement of Meyer Jacobstein of Brookings Institution
"It is obvious
that it is necessary to mop up the excess purchasing power of the community,
not only because of it's effect on the price situation but because the
Treasury needs the money and needs it quickly.*
Obviously the Treasury
can collect from the consumers as the purchases are made and the Treasury
has the use of those funds long before it would obtain them by the income-tax
Now, there are many
ways, of course, of mopping up this surplus purchasing power...Now,
there is the withholding tax at the source based on payrolls."
Senator Clark: "Doctor,
what this plan is, it is essentially a compulsory savings plan based
on sales tax methods, is it not?"
"I should say that is a fair description of it, yes. It is the
use of a sales tax method without being a tax."
Senator Clark: "So
far as the impact on the public is concerned, it is precisely the same
as a sales tax, except you give the money back sometimes."
"That is right. That is a very fair statement, I think. Senator
Danaher used the word "self-assessment." If I buy a dollar
necktie I pay $1.10 under his plan. A withholding tax is usually withheld
at the source. Here you withhold it not at the manufacturer's end but
at the retailer's end. You are using the retailer instead of the manufacturer
to siphon off several billion dollars, depending on the rate of the
assessment of a tax.
It may be that several
systems can be used. Any one of them might be very useful to the Treasury
in accomplishing this purpose. But...for siphoning off purchasing power
into the Treasury from day to day, or week to week, or month to month;
and it has that advantage.
Now, there is an
aspect to this question which was not brought out in the original memorandum
which would make the scheme perhaps a little more palatable if certain
deductions were made by any method, either by the withholding tax method
or direct sales tax method or by Senator Danaher's proposal...."
Statement of Charles O. Hardy of the Brookings Institution
Mr. Hardy: "First...mainly
for the purpose of providing an exemption from the tax or forced loan,
either one. Now, as has been stated a moment ago, this is a forced loan.
It should be pointed out, I think, that you can do the same thing with
the mechanics of any other tax, that is, under the income tax you can
give out bonds or coupons redeemable in bonds instead of giving receipts
for the income tax. You can do that, as far as I can see, with any tax,
for the whole schedule of taxes.
I would like to
say...that we have to bring about a readjustment of consumption in the
country to the amount of consumers goods and services that we can spare
the resources to produce under war conditions. First, we have got to
devote our productive energies to the war.
Or, you can use
the mechanism of the sales tax, as far as I can see, by mopping up the
increased purchasing power that is created by the rising amount they
receive in their paychecks. On the other hand, if the money is stored
up, whether it is in the form of these stamps or in the form where people
haven't spent it because they have had no way to spend it, in either
case if it is too large a proportion you are going to have the problem,
whenever you do turn it loose, that you have now in the other case,
namely of having a lot more purchasing power than you have goods and
services to make it good with.
That is the answer,
I think, to the question that might be raised as to why not carry this
principle through and apply it to income tax, corporation tax, and everything
else. Obviously, this has the advantage that this definitely sews up
the purchasing power in such a way that it cannot be released until
we discover the proper way to release it.
I think it has a
great advantage over the deficient spending program. This program just
postpones the problem of administration, in deciding how much purchasing
power is available to release and to what extent it will create the
old wartime inflation over again."
"Let me ask you this question: Considering the withholding tax,
simply the treasury withholds it currently and applies the proceeds
against the tax due in a given year..."
Mr. Hardy: "The
deduction from salaries and interest, and so on, at the source?"
Mr. Hardy: "Yes."
"That is a currently applied method of withholding so much of the
consumer purchasing power as is represented by the tax collected or
Mr. Hardy: "That
"And the applied as against the tax due."
Mr. Hardy: "Yes.
The withholding tax provision has the effect of withholding purchasing
power at the time the income is realized rather than a year hence through
the income tax structure."
"And if it were in effect for 1 year it would apply only 1 year?"
Mr. Hardy: "I
"Yes. Whereas this proposal is a continuing thing."
Mr. Hardy: "It
seems to me the essential difference is that the withholding tax plan
applies at the point of receipt of income, and this applies at the point
of expenditure of income."
"Of course, you withhold not only from taxpayers but nontaxpayers."
Mr. Hardy: "Yes.
Some people that I talked to about this plan, Federal Reserve people,
have been rather favorable to the idea."
"Don't you want to add that Mr. Selko pointed out that such difficulties
as are encountered in the States are, partially at least, overcome when
you have a uniform Federal tax? Where you have a uniform tax all over
the country by one administration, the Federal Government, it is easier
to administer than a sum total of 48 states. Now that was Mr. Selko's
Statement of Milton Friedman, Division of Tax Research,
"I have only one other thought on that point. In the event of withholding
from the owner of stock and no taxes due ultimately, where does he get
Mr. Friedman: "You
thinking of a corporation or an individual?"
"I am talking about an individual."
Mr. Friedman: "An
individual will file an income tax return, and that income tax return
will constitute an automatic claim for refund." End of document
What bald faced
lies. "Mop up purchasing power"? Fleecing Americans dry is
a more accurate way to describe this terrible injustice against US.
How about letting Americans decide to save the fruits of their labor?
No, the government wants it all.
* Art. 1, Sec.
8 of the U.S. Constitution gives Congress the power to issue money,
not the private fed: "To coin money, regulate the value thereof,"
Cut out the middle man ("Fed") and the Treasury wouldn't "need
the money." What a con game.
T. Coleman Andrews.
Mr. Andrews (a Democrat) was Commissioner for the first 33 months of
the Eisenhower Administration, stated the following in an article for
U.S. News & Report, May 25, 1956:
confiscating property now....That's socialism. It's written into the
Communist Manifesto. Maybe we ought to see that every person who gets
a tax return receives a copy of the Communist Manifesto with it so he
can see what's happening to him."
Chairman of the Federal Reserve Bank of New York stated in one of his
speeches in 1946:
"The second principal purpose of federal taxes is to attain more
equality of wealth and of income than would result from economic forces
working alone. The taxes which are effective for this purpose are the
progressive individual income tax, the progressive estate tax, and the
gift tax. What these taxes should be depends on public policy with respect
to the distribution of wealth and of income.
It is important,
here, to note that the estate and gift taxes have little or no significance,
as tax measures, for stabilizing the value of the dollar. Their purpose
is the social purpose of preventing what otherwise would be high concentration
of wealth and income at a few points, as a result of investment and
reinvestment of income not expended in meeting day-to-day consumption
requirements. These taxes should be defended and attacked it terms of
their effects on the character of American life, not as revenue measures.
Taxes on corporation profits have three principal consequences --- all
of them bad."
Does the average man or woman in America know this?
What do we mean
when we say that the IRS is not a government agency? Read this quote
from an U.S. attorney submitted in court documents in a tax case up
United States Attorney, Box 32, Boise, Idaho 83707. Civil No. 93-405-E-EJL,
United States' Answer and Claim re: Diversified Metal Products, Inc.,
Plaintiff v. T-Bow Company Trust, Internal Revenue Service and Steve
Morgan, Defendants, page 4, paragraph #4:
"Denies (the U.S. government) that the Internal Revenue Service
is an agency of the United States government ..."
If the IRS is not
an agency of the federal government, just what is it? In a nutshell,
the income tax is international in scope and not incumbent upon domestic
Americans. That is a provable fact. The IRS for more than 80 years has
been misapplying the IRCode against unsuspecting Americans and back
up their unlawful activities with brute force. This must stop.
What can you do?
The federal government
must generate revenues to operate what our Founding Fathers created:
A limited form of Republican government. State constitutions are all
guaranteed a limited form of Republican government. America is not a
democracy. We believe America is a nation of laws, not lies. We can't
have it both ways for political expediency or to please any and every
special interest group that bribes politicians at all levels with the
politically correct "PAC money."
Sometimes it's difficult
to be the messenger of news that people would rather not hear.
can no longer remain in their comfort zones because the message isn't
what they want to hear. If your house is on fire, you don't sit and
continue to watch the television set, you call the fire department.
America: Our house is on fire and it is the obligation of every American
to safeguard the liberties and freedoms given to us by those who paid
the ultimate price. Please join the growing numbers of millions who
are ready to take back our country and stop the assault on our rights.
I realize everyone's
time is at a premium, but I encourage you to read these recent columns
over a cup coffee. Things are escalating and going to get much worse
and Americans are going to get caught off guard: