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September 5th, 2005
An answer to the Steve Forbes flat tax
In a recent article Steve Forbes contends that “A Flat Tax Would Unleash a Stupendous Economic Boom“.
Unfortunately, even if Mr. Forbes is correct, the “boom” he speaks of will not be enjoyed by the American People, but consumed by the beast in Washington, D.C. and his flat tax will be nothing more than a tool to feed this beast.
Apparently Steve Forbes, although a very successful business man, appears to be politically naïve.
The problem America faces is a Congress out of control; a Congress which will be happy to use the Forbes flat tax, or the so called Fair Tax, or even a value added tax to engage in its ongoing reckless spending and borrowing practices which have created a national debt now exceeding $ 50 TRILLION and is the big problem which the America taxpayer faces___ a problem which will be thrust upon the backs of our nation‘s younger generation if something is not done now to correct the problem.
Neither the Forbes flat tax nor the alleged Fair Tax promoted by radio talk show host Neal Boortz, or a value added tax does anything to control the wasteful spending and borrowing practices of Congress; does anything to encourage Congress to start following sound fiscal and economic policies beneficial to America’s businesses, industries and labor; nor do any of the above proposals compel Congress to extinguish annual deficits in a manner in which members of Congress would be quickly held accountable by their State Governor and Legislature for their reckless spending and borrowing habits!
Sad thing is, in this respect, the Forbes flat tax, just as the Boortz promoted [H.R. 25] and the value added tax plan, are nothing but cleverly concocted plans allowing Congress to skin the goose which lays the golden eggs and continue in its unaccountable profligate borrowing and spending habits which is the worm at the root of the tree. All the above proposals are variations of a single plan to support existing big government and the countless political plum jobs on Capitol Hill, many of which have six figure salaries and redistribute money taxed away from hard working Americans for functions not authorized by the enumerated powers granted to Congress by our Constitution.
So, what should the people be supporting to end the existing suicidal system by which a federal revenue is raised by Congress and unjustly burdens our nation‘s industries, businesses and labor? I would say the answer is to support those who are promoting a return to our Founding Father’s original tax plan by adding the following words to our Constitution:
The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay “any” tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.
Adopting the above wording into our Constitution will bring us back to our Founding Father's original tax plan.
Now, how does our founding father’s original tax plan differ from the various big government friendly tax plans? Well, it was designed by “tax rebels”, people who fully understood the subtleties and oppressive nature of taxation and how taxation was formally used to benefit the King and not the people. And so, they carefully constructed a tax plan favorable for the people and their business interests. They created a plan which granted sufficient power, almost unlimited power to raise revenue for the new government they were creating, but they carefully designed it in such a manner to not only disburse the costs of government in a fair and equitable manner and remove various known tools of oppression, they likewise included a number of self regulating checks and balances to control the actions of Congress!
Let us now examine just one important part of the Founder‘s plan which was intended to be used to extinguish deficits in a manner creating a moment of accountability for every state’s Congressional Delegation___ accountability which our big spending Republicans and Democrats in Congress fear with a passion!
Under the founders plan, if insufficient revenue was brought in from imposts, duties and excise taxes [Congress’ indirect taxing powers] and Congress borrowed to meet its exigencies, Congress was then intended to lay a direct tax apportioned among the states for the total sum of the deficit created.
Few people realize the Founding Fathers provided a FAIR SHARE FORMULA in our Constitution for direct taxation and did so to not only preclude Congress from raising revenue in an unjust manner, but did so to establish a moment of accountability for every Senator and Representative in Congress Assembled.
Under the direct tax each state was intended to contribute a share of the total figure being raised by Congress to extinguish the deficit based upon its number of votes in Congress___ representation with proportional obligation__ a constitutionally mandated fair share formula which our big spenders in Congress dread! You see, under the Founder’s plan there are no loopholes, no manipulation, and, those state congressional delegations with the biggest mouth in Congress, who would dare use their large voting strength to squander federal revenue, create big government or send our money to distant lands through a “United Nations” [a money laundering operation] were to bring home to their State’s Governor a bill for the largest share of the direct tax ___ a very important check and balance of our founding fathers encouraging each state’s legislature and its governor to keep a jealous eye on their congressional delegation’s spending habits while in Washington, which is no longer being practiced, but if practiced, would be an immediate cure for today’s irresponsible spending and borrowing habits of Congress who have enslaved our nation’s younger generation with an ever increasing national debt.
There is no smoke and mirrors with the 'FAIR-SHARE' method of balancing the budget. The emergency direct tax ought to be statutorily imposed whenever Congress closes a fiscal year with a deficit. The structural mechanism which would immediately bring fiscal sanity to Congress is the requirement of having Congress send a bill to the Governor of each state, notifying him/her to remit their state's apportioned share toward extinguishing the deficit created during the year by Congress___ the governors and state legislators being left with the burden of having to raise this money, only to then send it off to Washington, D.C.
Picture for a moment the expression on the faces of the Governor of New York and the New York State Legislature, if New York should receive a bill for its apportioned share [29/435] of the 2005 federal deficit. This threat would create a compelling incentive for the Governor of each state, and the various state legislatures, to keep a jealous eye on the spending habits of their Congressional Delegation . . . it would require the fiscal accountability which the state governments once demanded from their Senate and House Members!
For a $20 million direct tax being imposed upon the states in 1861, and the amounts required to be paid by each of the various states, see HERE and use the buttons at the bottom of the page to go forward and backward.
As to Mr. Forbes, I don’t think Mr. Forbes is really politically naïve. I think Mr. Forbes is doing a very important job very similar to that of Boortz, Linder, and those who offer various other tax reform plans to the public which do nothing to control the actions of Congress and merely divide the people into various tax reform groups which diminishes their strength.
We all know there is a 70 - 80 percent approval rate among the American People to do away with “income” taxation and repeal the 16th Amendment, which would ironically bring us back to our founding father’s original tax plan which dishonorable politicians fear with a passion. And so, our clever folks in Washington have found a way to make such a large segment of our population impotent____ they have conned the people into thinking a replacement tax plan is needed if the 16th Amendment is repealed, and they have offered various government friendly tax reform plans for the people to argue over as a replacement to income taxation, which separates them into various tax reform advocacy groups and diminishes their overall strength.
But the truth is, the only tax reform needed is to return to our Founder’s original tax plan, and that can be accomplished if the people stay focused, unit, and demand their employees in Washington, D.C. add the following words to our Constitution:
The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay “any” tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.
To see what thinking Americans are promoting with regard to raising a federal revenue, CLICK HERE and go to “Taxes”.
For those who are unfamiliar with our Founding Fathers original tax plan, as they intended it to work, a plan which also includes a specific method to extinguish an annual deficit, CLICK HERE and scroll down to :
American Constitutional Research Service Before the
Committee on Ways and Means
United States House of Representatives
June 1995
Mr. Chairman and Members of this Committee:
Regards,
JWK
ACRS
“He has erected a multitude of new offices, and sent hither swarms of officers, to harass our people, and eat out their substance” ___Declaration of Independence