I do it once a month for the People's Congress!


Won't You?


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Alternative Tax Schemes Have Been Around A Long Time
(Part I)

Devvy Kidd
April 2, 2003

Important related article:


Many people have heard of alternate tax schemes to replace the current progressive income tax system destroying this country:

Flat ax, sales tax, alternate tax, consumption tax - tax, tax, tax.

None of the current crop of pushers of these alternate tax schemes will even entertain the constitutional remedy to fund a limited form of Republican government requiring no direct taxation against the people. One must wonder why.

None of these tax schemes will solve the problem of abolishing the central bank - the real head of the beast. Why support any alternative taxing scheme that continues to feed the banking cartel?

The "pay-as-you-go" withholding tax scheme was developed solely to pay for WWII, much to the absolute delight of the banking cartel. Last week Mr. Bush told Congress he wants $70 billion dollars to pay for the "rebuilding of Iraq."

Unconstitutional as all get out. Since there is no money in the treasury, how much heavier are the chains Americans are shackling their children's future going to be if We the People allow more of this grotesque rape of our nation's resources?

Say! War is business and business is booming! You may be interested in these words from a two time Congressional Medal of  Honor recipient:

Smedley Butler (1881-1940), U.S. Marine Commander:

"I spent 33 years in the Marines. Most of my time being a high-class muscle man for Big business, for Wall Street and the  bankers. In short, I was a racketeer for capitalism. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-1912. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I brought light  to the Dominican Republic for American sugar interests in 1916. I helped make Haiti and Cuba a decent place for the National  City Bank boys to collect revenue in. I helped in the rape of half a dozen Central American republics for the benefit of Wall  Street....

"In China in 1927 I helped see to it that Standard Oil went its way unmolested. I had a swell racket. I was rewarded with  honors, medals, promotions. I might have given Al Capone a few hints. The best he could do was to operate a racket in three  city districts. The Marines operated on three continents. We don't want any more wars, but a man is a damn fool to think there  won't be any more of them. I am a peace-loving Quaker, but when war breaks out every damn man in my family goes. If we're ready, nobody will tackle us." The World Tomorrow, October 1931 & The NY Times, August 21, 1931, said by Smedley Butler (1881-1940), U.S. Marine Commander.

He also said:

"You know very well that the American Legion is nothing but a strike-breaking outfit used by capital for that purpose, and that  is the reason we have all those big clubhouses and that is the reason I pulled out of it. They have been using the dumb soldiers  to break strikes." Testimony before the House of Representatives, Committee on the Investigation of Nazi and other  propaganda. 1935

And one more by Mr. Butler after his appearance before the Un-American Activities Committee in 1935:

"Do you think it could be had to buy the American Legion for Un-American activities? You know, the average veteran thinks  the Legion is a patriotic organization to perpetuate the memories of the last war, an organization to promote peace, to take care of the wounded and to keep green the graves of those who gave their lives.

"But is the American Legion that? No sir, not while it is controlled by the bankers. For years the bankers, by buying big club houses for various posts, by financing its beginning, and otherwise, have tired to make a strike breaking organization of the Legion. The groups - the so-called Royal Family of the Legion - which have picked its officers for years, aren't interested in patriotism, in peace, in wounded veterans, in those who gave their lives. No, they are interested only in using the veterans through their officers."

Excerpt from a speech delivered in 1933, by Major General Smedley Butler, USMC on interventionism (today's war is nothing more than flagrant invasion):

"War is just a racket. A racket is best described, I believe, as something that is not what it seems to the majority of people. Only a small inside group knows what it is about. It is conducted for the benefit of the very few at the expense of the masses.

"I believe in adequate defense at the coastline and nothing else. If a nation comes over here to fight, then we'll fight.  The trouble with America is that when the dollar only earns 6 percent over here, then it gets restless and goes overseas to get 100 percent. Then the flag follows the dollar and the soldiers follow the flag.

"I wouldn't go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket.

"There isn't a trick in the racketeering bag that the military gang is blind to. It has its "finger men" to point out enemies, its "muscle men" to destroy enemies, its "brain men" to plan war preparations, and a "Big Boss" Super-Nationalistic-Capitalism.

"It may seem odd for me, a military man to adopt such a comparison. Truthfulness compels me to. I spent thirty- three years and four months in active military service as a member of this country's most agile military force, the Marine Corps. I served in all commissioned ranks from Second Lieutenant to Major-General. And during that period, I spent most of my time being a high class muscle- man for Big Business, for Wall Street and for the Bankers. In short, I was a racketeer, a gangster for capitalism.

"I suspected I was just part of a racket at the time. Now I am sure of it. Like all the members of the military profession, I never had a thought of my own until I left the service. My mental faculties remained in suspended animation while I obeyed the orders of higher-ups. This is typical with everyone in the military service.

"I helped make Mexico, especially Tampico, safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefits of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-1912 . I brought light to the Dominican Republic for American sugar interests in 1916. In China I helped to see to it that Standard Oil went its way unmolested.

"During those years, I had, as the boys in the back room would say, a swell racket. Looking back on it, I feel that I could have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.

Smedley Darlington Butler

Major General - United States Marine Corps [Retired]
Born West Chester, Pa., July 30, 1881
Educated Haverford School
Married Ethel C. Peters, of Philadelphia, June 30, 1905
Awarded two congressional medals of honor, for capture of Vera Cruz, Mexico, 1914  and for capture of Ft. Riviere, Haiti, 1917
Distinguished service medal, 1919
Retired Oct. 1, 1931
On leave of absence to act as director of Department of Safety, Philadelphia, 1932
Lecturer -- 1930's
Republican Candidate for Senate, 1932
Died at Naval Hospital, Philadelphia, June 21, 1940
For more information about Major General Smedley Butler, contact the United States Marine Corps.

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Please note throughout the pieces below, the common thread is to tax the hell out of Americans to control inflation. More smoke and mirrors. We simply must get our fellow country men and women educated on who and what really creates inflation: The central bank, deceptively called the "Federal" Reserve.


Let's take a stroll back in history for proof of my prior statement:

H.J. Res. 30
78th Congress
1st Session

In the House of Representatives
January 6, 1943

General Sales Tax

Appendix to the Congressional Record, page A5043

Extension of Remarks
of HON. Usher L. Burdick
of North Dakota
In the House of Representatives
November 23, 1943

Mr. Burdick. Mr. Speaker, the annual convention of the North dakota Farmers Union went on record very definitely in regard to a general sales tax, and the resolution there adopted reads as follows:

Stabilization of economy: We commend our national and State leadership for standing firm for the Farmers Union policy formulated before Pearl Harbor for the complete stabilization of our internal economy and positive control of inflation. We recognized that at all costs we must prevent the repetition of the inflation and resultant deflation following WWI which caused 1,000,0000 American farmers to lose their homes and eventually caused 16,000,000 workers to lose their jobs.

To that end we support: Opposition, with every ounce of strength we can muster, to a general sales tax which, if passed, would be highly inflationary - not deflationary.

It is apparent from the wording of this resolution that the farmers of North dakota think clearly on this vital question and they have not forgotten the results of the last war. They are to be commended for their foresight in pointing out the dangers ahead.

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Dragging Social Security taxes into the mix:

Congressional Record - House, 1942, page 7605

Social Security

Mr. Cellar. Mr. Speaker, I ask unanimous consent to address the House for one minute.

The Speaker. Is there objection to the request of the gentleman from New York.

There was no objection.

Mr. Celler. Mr. Speaker, the Senate Finance Committee has very appropriately adopted an amendment to the proposed tax bill canceling the scheduled increase in social security taxes commencing January 1. Secretary of the Treasury Morgenthau has taken emphatic exception. I respectfully differ with Mr. Morgenthau.

On the present basis of rates there has developed a huge surplus in social security funds over $5,000,000,000. I reported almost a year ago that the amount collected in social security taxes over a period of four years was 81 percent greater than the amount paid out.

This surplus, of course, is not in the Treasury. It has been siphoned out by the Treasury for general expenses and IOUs are substituted. Why should those subject to social security taxes pay for the general expenses of the Nation?

It is most illogical to have 40 percent of the people - a segment of the population - contribute to the general appropriations for running the Nation.

Self-employers, farmers, domestics, doctors, lawyers and many others are thus exempt from taxation.

If that is logical, it would be just as logical for the Secretary of the Treasury to do a buck-and-wing dance on the Treasury steps. I think the tax should be frozen at the present rates, if not reduced.

The Secretary also claims increases in social security taxes would aid the drive against inflation. But why should 40 percent of the population be compelled to aid that drive and 60 percent go scott free and be relieved of that compulsion?

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A comprehensive explanation of Employers and Social Security taxes (37 pgs) can be found on my CD: https://devvy.com/cdrom_sales.html

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Congressional Record - House, 1942, pg 7689

Mr. Ploeser. Mr. Speaker, I ask unanimous consent to address the House for one minute to revise and extend my remarks.

The Speaker. Is there objection to the request of the gentleman from Missouri?

There was no objection.

Mr. Ploeser. Mr. Speaker, I strongly favor and advocate the enactment of a pay-as-you-go income tax law for individual tax payers. A law which would embrace the following principles:

First. A provision for the current collection of estimated taxes on current income. In other words, individual income tax payers would pay their 1943 income tax during the year 1943, the year in which the income is earned.

Second. This would eliminate the ever current tax indebtedness of income tax payers; it would change nothing on the books of the Treasury which does not now carry a tax indebtedness as an accounts-recievable item or asset. Current tax collections would not change current income of the Treasury.

Third. Individuals would be paying their income tax as they earn the income and while they have the ability to pay.

Fourth. Such a provision would eliminate the taxpayer's problem of paying a 1942 tax on a high income with the earnings from a 1943 low income.

Fifth. Such a provision would virtually eliminate uncollectible and delinquent taxes from the Treasury's present problems on individual income tax returns.

Sixth. The taxpayer would always know his net income usable for himself and needs.

Seventh. Such a plan would currently take excess earnings and thereby be somewhat beneficial as a deterrent to inflation.

Eighth. This plan would naturally embrace the elimination of one past tax bill for every individual income tax payer. However, such an elimination of tax bill would not in any way affect the income of the Treasury. It does, however, provide this postponed
benefit to taxpayers in that when income ceases no tab debt exists.

Mr. Speaker, on July 27 of this year a Mr. Beardsley Ruml, who is chairman of the Federal Reserve Bank of New York and adviser of the National Resources Planning Board, very ably presented such a provision to the Senate Committee on Finance. While I realize that from a parliamentary standpoint we cannot at this time in the House incorporate it in the current tax bill, I am hopeful that the Senate will give consideration to it for I will welcome the opportunity to vote for House approval of such a Senate amendment to the 1942 tax bill.

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Nothing like inviting the fox into the hen house.

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Appendix to the Congressional Record, pg 2346-47

The Sales Tax Obsession

Extension of Remarks

of HON. Bennett Champ Clark
of Missouri

In the Senate of the United States
June 18, 1942

Mr. Clark of Missouri. Mr. President, I ask unanimous consent to have printed in the Appendix of the RECORD an editorial appearing in the St. Louis Post-Dispatch of June 15, 1042, entitled "The Sales Tax Obsession."

There being no objection, the editorial was ordered to be printed in the RECORD, as follows:

The Sales Tax Obsession

When the House Ways and Means committee reached the cigarette tax item in its consideration of the Treasury's revenue program it found a proposal for increases that would yield an estimated $188,6000,000 in new funds toward the colossal amount needed to fight and win the war. The Treasury proposed that the present tax of 6 ½ cents per package on cigarettes be raised to 7 cents for the brands now selling at 10 cents, and to 8 cents for the 15-cent brands.

Was there anything unreasonable about this? Not that the ordinary cigarette purchaser can see. He has been prepared for higher-priced smokes, just as he has been prepared for a higher income tax, and he would be perfectly willing to pay a half-cent or 1 ½ cents more per package as a minor contribution toward victory. Differentiating between the two price ranges of cigarettes seems perfectly all right, too, since price is the basis on which virtually all other forms of taxation are levied.

The committee didn't see it that way, however. It rejected the idea for two tax levels to correspond with the two price levels. It approved a flat increase to 7 cents a package, which it estimates will raise $65,500,000 in new revenue. With that action, the committee slashed $123,000,000 out of the carefully prepared Treasury schedule.

That piece of mutilation is typical of what the committee has been doing to the whole Treasury program in the 104 days since it began its study.

The committee has hacked millions out of the Treasury's excess profits tax estimates, the corporation tax schedules, the individual income tax program (except where it drastically stepped up the levy for the lowest brackets of taxpayers). It has rejected elimination of the tax-exemption privilege on public securities. It has cut out other proposals for increases in excise taxes on beer, wine, gasoline, lubricating oil, and other products.

The result of all this carving is that the bill as it stands is far short of the $8,700,000,000 in new revenue for which the President asked and which the Treasury plan would have provided. The bill, in fact, is some $2,7000,000,000 short of that amount.

And what is the purpose of the committee's harsh treatment of the Treasury program? The purpose is becoming clearer every day: enactment of a Federal sales tax.

If every other recourse has failed, the public will not complain over a sales tax on all its food, all its clothing, and everything else it buys. The public will accept this, just as it as accepted many other sacrifices, even though it will put a heavy burden on the low-paid groups and bear less severely on persons of larger income.

But, every other recourse has not yet failed. The case for a sales tax has not yet been made. The committee is certainly not making such a case by its butchery of the Treasury revenue program. It is merely exposing itself as a group whose majority is so eager to act this unfair levy that it is wrecking piecemeal the Treasury's scientifically drawn and nonpolitical schedules. This is being done, it is plain as can be, in order to get an excuse for putting a sales tax over on the people.

In fact, so obsessed is the committee with the sales tax idea that members now are saying that the provisions it has already approved for individual and corporation taxes may be revised sharply downward, "especially if a sales tax were added to the bill."

Should not this committee be served with emphatic notice that the people do not want a sales tax saddled upon them by any such underhanded methods as this? Should not the public tell the committee to stop playing fast and loose with the Treasury program in order to foist its own pet theory of revenue raising upon the country?

Americans will pay their taxes willingly, as a patriotic duty, but they have the right to demand fair play in adoption of those taxes."

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Appendix to the Congressional Record, pg A2758, 1942

Why A Retail Sales Tax Should Not be Adopted by the Congress

Extension of Remarks


HON. John J. Cochran
of Missouri

In the House of Representatives
July 15, 1942

Mr. Cochran. Mr. Speaker, under leave to extend my remarks, I include the following, which is the text of an address by Hon. Richard M. Duncan, of Missouri, made during the National Radio Forum, arranged by the Washington Star, and broadcast over the Blue Network, July 13, 1942:

For more than four months the Ways and Means Committee has been laboring almost day and night on the revenue bill for 1942.

In its present form, it is estimated that it will raise in excess of $23,000,000,000, $6,250,000,0000 more than last year, the largest revenue measure in all the world's history.

During its consideration there has been much discussion by members of the committee, by the newspapers, the columnists and the public generally, of some form of sales tax, particular a retail sales tax.

Many large taxpayers, both corporate and individual, vigorously advocated such a tax, believing its adoption would prevent a steep increase in their income taxes. This was an erroneous assumption, as I shall prove later.

Twenty-two States have adopted a sales tax of some form. However, the great majority of them are retail sales taxes.

For the purpose of this discussion tonight, I think we may eliminate the manufacturer's sales tax, as it admittedly would produce a very small amount of money, and confine the discussion to a national retail sales tax.

The revenue bill as it now stands does not contain any provision for a sales tax except excise taxes.

I am opposed to a retail ales tax for numerous reasons but will discuss briefly only four:

1. It is an invasion of the field which as been preempted, to a very large degree, by the States, although neither the States nor the Federal Government have shown much inclination to respect the fields of taxation which each has invaded. The principle to me, nevertheless, remains, and should be respected, as far as it is possible to do so.

We are fighting today to preserve our form of government and we must respect that form of government itself and not weaken it more than is absolutely essential.

The States today are facing the most serious problem with respect to revenues they have ever faced because such a large percentage of our economy is being devoted to the war purpose.

During the first World War approximately 10 percent of our economy was devoted to the war purpose, whereas within a short time approximately 60 percent of our economy will be devoted to the present war purposes.

It is also true that the States generally must keep within their budgets; they face a greater difficulty in deficit financing than does the Federal Government. Their deficits must be met usually by taxation or by bond issues approved by the people. It is also true that the proceeds from a sales tax in many States is used for old-age pensions and other direct benefits to the people - such as the maintenance of public schools and other State institutions. This load has very definitely not been lessened because of the war but in many instances increased.

2. A sales tax falls most heavily upon those least able to pay. To many people this argument does not appeal. They say that all persons should contribute something to the maintenance of their Government. My answer is that they do. Even under the present law it is estimated that a married couple with an income of $1,500 pays approximately $250 a year in Federal, State and local taxes in various forms and ways.

Under the proposed revenue bill the exemptions have been reduced to $500 for single persons and $1,200 for married persons, and the proposed rates will impose upon them the heaviest burden that the American people have ever been asked to bear, greater than they ever conceived they would be asked to bear - the small, the medium, and the big incomes alike are taxed very heavily, and it seems to me that to superimpose a sales tax of 5 percent, which is the amount usually discussed, upon every commodity that all the people consume, upon their already very high taxes, would be an unfair and unjust burden, particularly upon the lower income groups whose income is practically all consumed in acquiring the necessities of life.

It has been estimated that persons in the very low income brackets pay as much as 65 percent of their income for the very commodities upon which a sales tax would be imposed, whereas those in the higher brackets spend a comparatively small percentage of their income for such things. Therefore, the statement that the tax falls most heavily upon those least able to pay.

Some of the States have rates of 3 percent, and an additional 5-percent Federal tax, taking 8 percent out of every dollar the housewife takes to the grocery store, would be a terrific financial burden, and that would be particularly true with respect to small purchases. It would drive from the market practically all such commodities as penny candy bars and many other things in the very low-cost field. A five percent sales tax would result in a 12 ½ percent tax on an 8-cent loaf of bread because we have no medium of exchange smaller than a penny and we are not likely, during times like these, with a short-age of metal, to coin such smaller pieces.

3.  Earlier in this discussion, I stated to you that I would prove that such a tax would not prevent a steep increase in corporate and individual tax rates. The Treasury Department recommended to the Congress an increase in corporate and individual tax rates. The Treasury Department recommended to the Congress an increase of $8,700,000,000 in 1942. A 5-percent retail tax would produce a comparatively small amount of money. In no event would it likely exceed $2,400,000,000. That is a small amount of money compared to $8,700,000,000, or even $6,250,000,000, which the committee has finally recommended.

If we remove from the base upon which the tax would be levied, the commodities now subject to excise taxes, producing nearly $4,700,000,000, the amount we would receive would be reduced to $1,700,000,000, and if we reduce the base still further by exempting food and medicine, which we look upon as the very essentials of life, the amount would be still further reduced to approximately $825,000,000, and certainly it would not be either economically sound or equitable to superimpose a retail sales tax upon commodities which already bear, in some instances, 15-percent excise taxes.

The early advocates of a sales tax in most instances apparently failed to take into consideration that almost 60 percent of our economy is being devoted to the war purpose; that we are now, so far as consumable commodities are concerned, practically at the 1935 level, and by early 1943, it is likely that we shall have reached the level of 1932, so the receipts from a sales tax upon our consumable commodities would decline as those commodities become scarcer. It would take approximately 15 percent on everything from bread to booze to produce the amount of additional revenue the committee has recommended in the bill. I believe that is the answer to those who advocate raising the additional amount of money from a national retail sales tax.

My fourth objection is based upon the problem of administration. There are approximately 2,650,000 retail outlets in the United States which would have to be checked by the representatives of the Bureau of Internal Revenue - every crossroad store and every peanut stand. The representatives of the Bureau estimated, when they were before the committee, that it would require an additional fifteen to eighteen thousand people to administer the tax. It would require a great deal of office space, typewriters, calculating machines, and other equipment now so scarce and so much needed in the war effort itself. The expense would run into millions.

We who have lived with the problem of taxation for a good many years realize just how difficult it is to get rid of a tax once it has been imposed. Ways are always found, apparently, to use every dollar of the revenue and need is always an argument against the repeal of any tax.

We also realize the great difficulty of reducing personnel in any department or bureau of the Government once it has been built-up.

The expense of administering such a tax would definitely run into the millions of dollars.


Don't miss part II! An interesting speech about Andy Jackson and the money fight.

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Constitutional lawyers: Please run for judgeships in your county:



Back in 1969, former Secretary of Agriculture, Ezra Taft Benson spoke pearls of  wisdom when he said:

"Already, I can hear the chorus chanting "isolationism, isolationism, he's turning back the clock to isolationism." How many use that word without having the slightest idea of what it really means! The so-called isolationism of the United States in past decades is pure myth. What isolationism? Long before the current trend of revoking our Declaration of Independence under the guise of international cooperation, American influence and trade was felt in every region of the globe. Individuals and private groups spread knowledge, business, prosperity, religion, good will and, above all, respect throughout every foreign continent.

"It was not necessary then for America to give up her independence to have contact and influence with other countries. It is not necessary now. Yet, many Americans have been led to believe that our country is so strong that will can defend, feed and subsidize half the world, while at the same time believing that we are so weak and "inter-dependent" that we cannot survive without pooling our resources and sovereignty with those we subsidize. If wanting no part of this kind of "logic" is isolationism, then it is time we brought it back into vogue."

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