By Jeffrey Tucker
Whiskey and Gunpowder Newsletter
Feb 3rd, 2012
Today is the 99th anniversary of the signing of the 16th Amendment to the Constitution. It enshrined into law an idea that stands in total contradiction to the driving force behind the American Revolution and the whole idea of freedom itself.
The great “old right” commentator Frank Chodorov once described the income tax as the root of all evil. His target was not the tax itself, but the principle behind it. Since its implementation in 1913, he wrote, “The government says to the citizen: ‘Your earnings are not exclusively your own; we have a claim on them, and our claim precedes yours; we will allow you to keep some of it, because we recognize your need, not your right; but whatever we grant you for yourself is for us to decide.’”
He really does have a point. That’s evil. When Congress ratified the 16th Amendment on Feb. 3, 1913, there was a sense in which all private income in the U.S. was nationalized. What was not taxed from then on was a favor granted unto us, and continues to be so.
This is implied in the text of the amendment itself: “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”
Where are the limits? There weren’t any. There was some discussion about putting a limit on the tax, but it seemed unnecessary. Only 1% of the income earners would end up paying about 1% to the government. Everyone else was initially untouched. Who really cares that the rich have to pay a bit more, right? They can afford it.
This perspective totally misunderstand the true nature of government, which always wants more money and more power and will stop at nothing to get both. The 16th Amendment was more than a modern additive to an antique document. It was a new philosophy of the fiscal life of the entire country.
Today, the ruling elite no longer bother with things like amendments. But back in those days, it was different. The amendment was made necessary because of previous court decisions that stated what was once considered a bottom-line presumption of the free society: Government cannot tax personal property. What you make is your own. You get to keep the product of your labors. Government can tax sales, perhaps, or raise money through tariffs on goods coming in and out of the country. But your bank account is off-limits.
The amendment changed that idea. In the beginning, it applied to very few people. This was one reason it passed. It was pitched as a replacement tax, not a new money raiser. After all the havoc caused by the divisive tariffs of the 19th century, this sounded like a great deal to many people, particularly Southerners and Westerners fed up with paying such high prices for manufactured goods while seeing their trading relations with foreign consumers disrupted.
People who supported it — and they were not so much the left but the right-wing populists of the time — imagined that the tax would hit the robber baron class of industrialists in the North. And that it did. Their fortunes began to dwindle, and their confidence in their ability to amass and retain intergenerational fortunes began to wane.
We all know the stories of how the grandchildren of the Gilded Age tycoons squandered their family heritage in the 1920s and failed to carry on the tradition. Well, it is hardly surprising. The government put a timetable and limit on accumulation. Private families and individuals would no longer be permitted to exist except in subjugation to the taxing state. The kids left their private estates to live in the cities, put off marriage, stopped bothering with all that hearth and home stuff. Time horizons shortened, and the Jazz Age began.
Class warfare was part of the deal from the beginning. The income tax turned the social fabric of the country into a giant lifetime boat, with everyone arguing about who had to be thrown overboard so that others might live.
The demon in the beginning was the rich. That remained true until the 1930s, when FDR changed the deal. Suddenly, the income would be collected, but taxed in a different way. It would be taken from everyone, but a portion would be given back late in life as a permanent income stream. Thus was the payroll tax born. This tax today is far more significant than the income tax.
The class warfare unleashed 99 years ago continues today. One side wants to tax the rich. The other side finds it appalling that the percentage of people who pay no income tax has risen from 30% to nearly 50% in this period of economic downturn. Now we see the appalling spectacle of Republicans regarding this as a disgrace that must change. They have joined the political classes that seek advancement by hurting people.
It’s extremely strange that the payroll tax is rarely considered in this debate. The poor, the middle class and the rich are all being hammered by payroll taxes that fund failed programs that provide no security and few benefits at all.
It’s impossible to take seriously the claims that the income tax doesn’t harm wealth creation. When Congress wants to discourage something — smoking, imports, selling stocks or whatever — they know what to do: Tax it. Tax income, and on the margin, you discourage people from earning it.
Tax debates are always about “reform” — which always means a slight shift in who pays what, with an eye to raising ever more money for the government. A far better solution would be to forget the whole thing and return to the original idea of a free society: You get to keep what you earn or inherent. That means nothing short of abolishing the great mistake of 1913. Forget the flat tax. The only just solution is no tax on incomes ever.
But let’s say that one day we actually become safe from the income tax collectors and something like blessed peace arrives. There is still another problem that emerged in 1913. Congress created the Federal Reserve, which eventually developed the power to create — on its own — all the money that government would ever need, even without taxing.
For the practical running of the affairs of the state, the Fed is far worse than the income tax. It creates the more-insidious tax of inflation. In a strange way, it has made all the debates about taxation superfluous. Denying the government revenue does nothing to curb its appetites for our liberties and property. The Fed has managed to make it impossible to starve the beast.
Chodorov was correct about the evil of the income tax. Its passage signaled the beginning of a century of despotism. Our property is no longer safe. Our income is not our own. We are legally obligated to turn over whatever our masters say we owe them. You can fudge this point: None of this is compatible with the old liberal idea of freedom.
You doubt it? Listen to Thomas Jefferson from his inaugural address of 1801. What he said then remains true today:
“…what more is necessary to make us a happy and a prosperous people? Still one more thing, fellow citizens — a wise and frugal government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement and shall not take from the mouth of labor the bread it has earned.”
Regards,
Jeffrey Tucker
Showing posts with label Whiskey and Gunpowder. Show all posts
Showing posts with label Whiskey and Gunpowder. Show all posts
Monday, February 6, 2012
Friday, January 6, 2012
JEFFREY TUCKER ON TODAY'S AMERICAN GOVERNMENT
by James Craig Green
Today, I present an article by Jeffrey Tucker, Executive Editor for Laissez-Faire Books. It crystalizes, in a few well-chosen words, the main problem with America and the world today - the insatiable, uncontrolled, destructive growth of government at all levels.
Simply stated, Mr. Tucker's piece presents the case that for at least the last two Centuries, the federal government of the United States has morphed into something the founding fathers couldn't have imagined, especially after its elegant beginnings in the Declaration of Independence and the U.S. Constitution (including its elegant Bill of Rights, never changed). Today, Mr. Tucker asserts, the American State is immune to the "will of the people" as it resists any and all fundamental changes while maintaining the false illusion that the so-called "public," or "people" are somehow in charge of it. I have noticed this for at least two decades, but have never seen the case made so simply and effectively as Mr. Tucker's current article.
This is why I formalized my libertarian roots three decades ago and joined the Colorado Libertarian Party, abandoning it after a few years of hopeless, unconstrained government growth at all levels without any serious attempt from within to control itself. American government, at all levels, has become an unconstrained monster, regularly thumbing its nose at its Constitution as amended, established legal precedents and the so-called and usually fraudelent pandering to the will of the people.
There is nothing representative, limited, or positive - on balance - about American government today, contrary to the Constitution.
The federal government is an out-of-control, massively destructive monster, becoming even more bold with demigods like Barack Obama, who, contrary to the opinions of my conservative friends, is only different from them in that his boldness to become a dictator has no bounds - not even the pretense that he respects limited American government. Both major political parties survive and prosper while maintaining the steady growth of government - especially the federal government, without regard to what is good for the people, especially in the long run. American government, once proudly representative and supposedly limited to the consent of the governed, is now an unrestrained tyrant. It will be put back in its place only after a massive economic collapse from its continued purposeful, century-long destruction of the American Dollar.
If you think Republicans are serious about limiting, or even slowing down, the growth of American government, then please see the following chart I researched and produced a couple of years ago, for the decades BEFORE Obama was elected (click to magnify):
In short, when Republicans have been in control of the federal government, it grows faster than when Democrats are in charge - only focusing on subsidizing the rich instead of the poor. However, Obama is taking up where George W. Bush left off - unrestrained growth of government without apology or serious consideration for Constitutional limitations like the Tenth Amendment, which has never changed.
Barack Obama was not the solution, and is not the problem. The emotional, almost hysterical support of so many Americans to his unrepentant socialism is not something new - just something much, much more honest than anyone but Ron Paul has shown in contemporary American Politics.
I hope you enjoy the following article as much as I did.
James Craig Green
1/6/2012
(edited 1/19/2012)
Whiskey and Gunpowder Newsletter
Article by Jeffrey Tucker
January 5, 2012
Auburn, Alabama, U.S.A.
Elections and the Illusion of Choice
The political season has unleashed its predictable frenzy, much to delight of people who make a living off it. But to what end? There are only two types of politicians who end up holding office, wrote H.L. Mencken: "first, glorified mob-men who genuinely believe what the mob believes, and secondly, shrewd fellows who are willing to make any sacrifice of conviction and self-respect in order to hold their jobs."
That about sums it up. The plus side of elections is that sometimes the debates, discussions, candidates and parties raise fundamental questions about what kind of society we want to live in. That's the best we can hope for.
But there is a downside to all this hullabaloo: It gives the impression that the mere existence of the electoral process gives "we the people" a fundamental choice about the kind of state we want. This is not true. The politicians we elect are veneers or facades. They are bandits, but they do not constitute what is called the state. This goes for just about every developed state in the world for the last 200 years.
The whole election process leads people to believe that the state is embedded in leaders. Not so. In France, this system ended with the execution of Louis XVI; in Germany, with the ascent of Bismarck; and in Russia, with the Bolshevik Revolution. The personal state died in the U.S. pretty early on, as even Thomas Jefferson discovered when he became president in 1801; he felt himself powerless to do anything.
The modern state lives outside the will of a particular leader or administration. Voting and elections only change the temporary managers, but do not touch the core of the problem.
The first book that saw through the facade was by the great German sociologist Franz Oppenheimer. It is called, appropriately, The State. It was written in 1908, just as the state had begun to entrench itself deeply into the social order -- more so than at any point in the previous thousand years. He described the state as the one class that dominates all others, obeying a different law and thriving off violence against person and property. He sums up this violence in a phrase: the "political means." He contrasts this with the "economic means," the essence of which is voluntary human association and trade. (His book came to have an amazing influence through Albert Jay Nock's Our Enemy, the State.)
Violence? That sounds like the opposite of elections, doesn't it? Surely, we are exercising our free will in deciding who leads us. The truth is that the people who run for office specialize mostly in what they do best: running and getting elected as an end in itself. The real state is beneath the surface of this public theater. It is the vast army of professional bureaucrats and the mandates they carry out. It is the enforcement apparatus that oversees a gargantuan tax code. It is the Federal Register that is too large to print. It is the central bankers, their staffs, their machinery, their mandate to bail out the state no matter what. It is the hundreds and thousands of agencies that purport to control every aspect of life.
No voter ever approved any of this; no election puts any of this at risk. This is because the state itself is not subject to any plebiscite. Imagine if all the elected officials in the entire country and all those who work in their offices decided not to show up to work for an extended period. What would happen? New bills wouldn't pass. The media wouldn't have politics to cover. There would be a periodic scramble over superficial issues like the debt limit. But otherwise, the state would go on just as before. Nothing fundamental would change.
Nor is it the case that any of the elected officials have the power to do serious damage to this system. This goes for the president, too. They can often influence the way the state grows, but they can't actually fundamentally threaten the apparatus itself. The longer they are in office, the less personal power they realize that they have. The reason is simple. The system is not structured to permit them to dismantle it, even if they wanted to. They are temporary managers of a ruling class, and the members of this class mostly scoff at these people, treating them like actors on a stage that the class itself owns.
The best source to gain a full grasp of the realities of the modern state apparatus is Robert Higgs' amazing work, Against Leviathan. No contemporary author has so fully documented the vast expanse of the modern leviathan in all its permutations. He sees how welfare and warfare are not opposed to each other, but work together to form the main two activities of the modern state. He sees how central banking works to sustain the system. He understands the ways in which the state serves as a cash cow for every form of interest group, and how it works to trick the population into believing that the state is doing good for people when it is really wrecking their lives.
Most of all, Higgs gets that the political system that so enraptures the public mind is not owned by us. It is owned and managed by the state itself and for a precise purpose: to perpetuate the idea that we have all chosen the regime that rules us. That is why there is so little difference between the political parties. As Higgs puts it, the U.S. has "two revolving factions of a one-party state farcically masquerade as authentic alternatives, the one specializing in crushing economic freedom and the other concentrating on crushing every other form of freedom."
After the election is all over -- in a grueling 10 months! -- and our new managers take their seats, the talking heads will tell us once more: "The system worked." Yes, it did work in exactly the way they want it to work. Nothing much will change. If you don't like the results, there is something wrong with you. If you don't like the rules, taxes, human suffering, wars, inflation, intrusions, confiscations and all the rest of the apparatus, you had better run for office, give to another candidate or otherwise throw yourself into the politics full time!
This is not choice. When we go to the grocery, we face a choice of what to buy. Or we can walk out without buying at all, keeping our money instead. Whatever the result, it is really in our hands. The electoral system is different. The store is the state. The products it offers are produced by the state. There is no real choice, only enough shadings of differences to keep us entertained. And we cannot really walk away. There is "no none of the above" and there is no keeping your own money.
Every once in a while, someone comes along who offers a fundamental challenge to the whole racket and somehow manages to attract public attention and even use the system to urge the dismantling of the system. This is what has happened with the candidacy of Ron Paul, and it is precisely why the media strains so hard to keep from reporting on him or letting others speak out for his views.
The elites are not so concerned that he can be elected. The system is fixed well enough to prevent that outcome. The real threat -- and Dr. Paul understands this better than anyone -- is the fundamental intellectual challenge that he offers. His book Liberty Defined contains enough radicalism and enough intellectual power to destabilize the entire structure that Oppenheimer and Higgs have so beautifully described.
The ideas in these books are far more powerful than any ballot box. They expose the illusion of choice for what it is and unmask the violence embedded in the state-dominated society, a system that no one chose but has been imposed on the population through propaganda, wars, payoffs and every manner of trickery. If there were a way to re-channel all the human energy that people put into politics into reading and thinking, the state would have finally meet its match.
Regards,
Jeffrey Tucker
Executive editor, Laissez-Faire Books
Today, I present an article by Jeffrey Tucker, Executive Editor for Laissez-Faire Books. It crystalizes, in a few well-chosen words, the main problem with America and the world today - the insatiable, uncontrolled, destructive growth of government at all levels.
Simply stated, Mr. Tucker's piece presents the case that for at least the last two Centuries, the federal government of the United States has morphed into something the founding fathers couldn't have imagined, especially after its elegant beginnings in the Declaration of Independence and the U.S. Constitution (including its elegant Bill of Rights, never changed). Today, Mr. Tucker asserts, the American State is immune to the "will of the people" as it resists any and all fundamental changes while maintaining the false illusion that the so-called "public," or "people" are somehow in charge of it. I have noticed this for at least two decades, but have never seen the case made so simply and effectively as Mr. Tucker's current article.
This is why I formalized my libertarian roots three decades ago and joined the Colorado Libertarian Party, abandoning it after a few years of hopeless, unconstrained government growth at all levels without any serious attempt from within to control itself. American government, at all levels, has become an unconstrained monster, regularly thumbing its nose at its Constitution as amended, established legal precedents and the so-called and usually fraudelent pandering to the will of the people.
There is nothing representative, limited, or positive - on balance - about American government today, contrary to the Constitution.
The federal government is an out-of-control, massively destructive monster, becoming even more bold with demigods like Barack Obama, who, contrary to the opinions of my conservative friends, is only different from them in that his boldness to become a dictator has no bounds - not even the pretense that he respects limited American government. Both major political parties survive and prosper while maintaining the steady growth of government - especially the federal government, without regard to what is good for the people, especially in the long run. American government, once proudly representative and supposedly limited to the consent of the governed, is now an unrestrained tyrant. It will be put back in its place only after a massive economic collapse from its continued purposeful, century-long destruction of the American Dollar.
If you think Republicans are serious about limiting, or even slowing down, the growth of American government, then please see the following chart I researched and produced a couple of years ago, for the decades BEFORE Obama was elected (click to magnify):
In short, when Republicans have been in control of the federal government, it grows faster than when Democrats are in charge - only focusing on subsidizing the rich instead of the poor. However, Obama is taking up where George W. Bush left off - unrestrained growth of government without apology or serious consideration for Constitutional limitations like the Tenth Amendment, which has never changed.
Barack Obama was not the solution, and is not the problem. The emotional, almost hysterical support of so many Americans to his unrepentant socialism is not something new - just something much, much more honest than anyone but Ron Paul has shown in contemporary American Politics.
I hope you enjoy the following article as much as I did.
James Craig Green
1/6/2012
(edited 1/19/2012)
Whiskey and Gunpowder Newsletter
Article by Jeffrey Tucker
January 5, 2012
Auburn, Alabama, U.S.A.
Elections and the Illusion of Choice
The political season has unleashed its predictable frenzy, much to delight of people who make a living off it. But to what end? There are only two types of politicians who end up holding office, wrote H.L. Mencken: "first, glorified mob-men who genuinely believe what the mob believes, and secondly, shrewd fellows who are willing to make any sacrifice of conviction and self-respect in order to hold their jobs."
That about sums it up. The plus side of elections is that sometimes the debates, discussions, candidates and parties raise fundamental questions about what kind of society we want to live in. That's the best we can hope for.
But there is a downside to all this hullabaloo: It gives the impression that the mere existence of the electoral process gives "we the people" a fundamental choice about the kind of state we want. This is not true. The politicians we elect are veneers or facades. They are bandits, but they do not constitute what is called the state. This goes for just about every developed state in the world for the last 200 years.
The whole election process leads people to believe that the state is embedded in leaders. Not so. In France, this system ended with the execution of Louis XVI; in Germany, with the ascent of Bismarck; and in Russia, with the Bolshevik Revolution. The personal state died in the U.S. pretty early on, as even Thomas Jefferson discovered when he became president in 1801; he felt himself powerless to do anything.
The modern state lives outside the will of a particular leader or administration. Voting and elections only change the temporary managers, but do not touch the core of the problem.
The first book that saw through the facade was by the great German sociologist Franz Oppenheimer. It is called, appropriately, The State. It was written in 1908, just as the state had begun to entrench itself deeply into the social order -- more so than at any point in the previous thousand years. He described the state as the one class that dominates all others, obeying a different law and thriving off violence against person and property. He sums up this violence in a phrase: the "political means." He contrasts this with the "economic means," the essence of which is voluntary human association and trade. (His book came to have an amazing influence through Albert Jay Nock's Our Enemy, the State.)
Violence? That sounds like the opposite of elections, doesn't it? Surely, we are exercising our free will in deciding who leads us. The truth is that the people who run for office specialize mostly in what they do best: running and getting elected as an end in itself. The real state is beneath the surface of this public theater. It is the vast army of professional bureaucrats and the mandates they carry out. It is the enforcement apparatus that oversees a gargantuan tax code. It is the Federal Register that is too large to print. It is the central bankers, their staffs, their machinery, their mandate to bail out the state no matter what. It is the hundreds and thousands of agencies that purport to control every aspect of life.
No voter ever approved any of this; no election puts any of this at risk. This is because the state itself is not subject to any plebiscite. Imagine if all the elected officials in the entire country and all those who work in their offices decided not to show up to work for an extended period. What would happen? New bills wouldn't pass. The media wouldn't have politics to cover. There would be a periodic scramble over superficial issues like the debt limit. But otherwise, the state would go on just as before. Nothing fundamental would change.
Nor is it the case that any of the elected officials have the power to do serious damage to this system. This goes for the president, too. They can often influence the way the state grows, but they can't actually fundamentally threaten the apparatus itself. The longer they are in office, the less personal power they realize that they have. The reason is simple. The system is not structured to permit them to dismantle it, even if they wanted to. They are temporary managers of a ruling class, and the members of this class mostly scoff at these people, treating them like actors on a stage that the class itself owns.
The best source to gain a full grasp of the realities of the modern state apparatus is Robert Higgs' amazing work, Against Leviathan. No contemporary author has so fully documented the vast expanse of the modern leviathan in all its permutations. He sees how welfare and warfare are not opposed to each other, but work together to form the main two activities of the modern state. He sees how central banking works to sustain the system. He understands the ways in which the state serves as a cash cow for every form of interest group, and how it works to trick the population into believing that the state is doing good for people when it is really wrecking their lives.
Most of all, Higgs gets that the political system that so enraptures the public mind is not owned by us. It is owned and managed by the state itself and for a precise purpose: to perpetuate the idea that we have all chosen the regime that rules us. That is why there is so little difference between the political parties. As Higgs puts it, the U.S. has "two revolving factions of a one-party state farcically masquerade as authentic alternatives, the one specializing in crushing economic freedom and the other concentrating on crushing every other form of freedom."
After the election is all over -- in a grueling 10 months! -- and our new managers take their seats, the talking heads will tell us once more: "The system worked." Yes, it did work in exactly the way they want it to work. Nothing much will change. If you don't like the results, there is something wrong with you. If you don't like the rules, taxes, human suffering, wars, inflation, intrusions, confiscations and all the rest of the apparatus, you had better run for office, give to another candidate or otherwise throw yourself into the politics full time!
This is not choice. When we go to the grocery, we face a choice of what to buy. Or we can walk out without buying at all, keeping our money instead. Whatever the result, it is really in our hands. The electoral system is different. The store is the state. The products it offers are produced by the state. There is no real choice, only enough shadings of differences to keep us entertained. And we cannot really walk away. There is "no none of the above" and there is no keeping your own money.
Every once in a while, someone comes along who offers a fundamental challenge to the whole racket and somehow manages to attract public attention and even use the system to urge the dismantling of the system. This is what has happened with the candidacy of Ron Paul, and it is precisely why the media strains so hard to keep from reporting on him or letting others speak out for his views.
The elites are not so concerned that he can be elected. The system is fixed well enough to prevent that outcome. The real threat -- and Dr. Paul understands this better than anyone -- is the fundamental intellectual challenge that he offers. His book Liberty Defined contains enough radicalism and enough intellectual power to destabilize the entire structure that Oppenheimer and Higgs have so beautifully described.
The ideas in these books are far more powerful than any ballot box. They expose the illusion of choice for what it is and unmask the violence embedded in the state-dominated society, a system that no one chose but has been imposed on the population through propaganda, wars, payoffs and every manner of trickery. If there were a way to re-channel all the human energy that people put into politics into reading and thinking, the state would have finally meet its match.
Regards,
Jeffrey Tucker
Executive editor, Laissez-Faire Books
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