"O, father, you are so wise. Please tell us again your opinions on the Sixteenth Amendment."
My daughters would normally ask me such questions at about bedtime, in my home office where the cable television link broadcast. Swollen with great pride that they had chosen me as their historical link to American politics and economics, I was more than willing to bend the strict regard for their bedtimes and enter into a brilliantly lain outline of study on US Income Taxes. I was more than honored that they sought my expertise, on a school night, and did not want to disappoint them in the delivery of my knowledge.
Where shall I begin? O, yes, they must know of Frederic Bastiat. Indeed, indeed, they must. For it is he who said, “Everyone wants to live at the expense of the state. They forget that the state lives at the expense of everyone.” One of the great tragedies of taxation is that everyone wants access to everyone else's wealth, intellectual property, and assets so that their pursuit of wealth creation may be aptly funded. Bully, bully, they are excited by such discourse. They are so darling!
O, yes, I will pass you the remote control as you listen so adamantly and nod your heads with such great comprehension.
I will speak of the Great Progressive Republican folly of President Theodore "Teddy" Roosevelt and the "Insurgent" Republicans in securing the federal income tax via Constitutional Amendment. The sexiness of having a larger government with a bigger military was too attractive to the Establishment Republicans of the day and their socialist friend, Victor Louis Berger, in Congress, that they could not resist. Teddy said, "Therefore, I believe in a graduated income tax on big fortunes, and in another tax which is far more easily collected and far more effective, a graduated inheritance tax on big fortunes, properly safeguarded against evasion, and increasing rapidly in amount with the size of the estate.”
Yes, o, yes, ladies, you may turn from the football game to SpongeBob. I can sense that you are very comfortable learning as much as you can about tax history.
By the way, it was the threat of central governance that many conservatives feared would come to pass if the income tax passed Congress and became a Constitutional Amendment.
Yes, ladies, you may have some of my popcorn and root beer but, not too much because it is late in the evening.
O, yes, baby girl, go downstairs and bring back blankets and pillows for you and your sister.
However, from the time of the Mayflower Compact in Massachusetts, there have been those that wanted to socialize the arts and sciences of wealth creation, creating strong arm interventionists strategies. William Bradford, in his journal, revealed the futility of socialism firsthand:
“The experience that we had in this common course and condition, tried sundry years...that by taking away property, and bringing community into a common wealth, would make them happy and flourishing – as if they were wiser than God.”
"For this community (so far as it was) was found to breed much confusion and discontent, and retard much employment that would have been to their benefit and comfort. For young men that were most able and fit for labor and service did repine that they should spend their time and strength to work for other men's wives and children without [being paid] that was thought injustice.”
“This [free enterprise] had very good success, for it made all hands industrious, so as much more corn was planted than otherwise would have been.”
Today, we call the artisans of the Mayflower Compact socialists. No matter what you say or evidence produced, they reject any notion that the redistribution of wealth and control of production and prices by the government will fail.
Others have longed for a fiercely strong federal government regulating the authority of individual states, the engines of capitalism, and fashioning society slowly into a socialist state. These are known today as progressives and they convince the "working or middle" class to become jealous of the rich or those that inherit wealth. The intent is to institute a government that makes the life of the poor less arduous, allowing monies to be directed by tax from the wealthy to improve their lives.
O, little lady, that is such a great question! I am so glad that you are listening to your Daddy. Sure, I'll turn the volume up but, just a little. I don't want your Mommy to know that y'all are up after your bedtime on a school night. Babies, progressives are both Democrats and Republicans. They are now known as the Establishment. Their objective is to grow the government and restrict the individual. They prefer to be the smooth operators of socialism. They subscribe to the power of the pen and the calculator. They use the pen to write legislation and their bureaucrats write regulations that go directly to the wallets of the capitalists, their sworn enemy. The Progressive Establishment believe that they can tax and spend our way into human equality. They, like the British loyalists during the Revolutionary War and the Federalists thereafter, believe that a strong central government and a central bank will assure the equality of mankind. Socialists believe in the New Deal. Progressives believe in the Square Deal. Between the two, Americans end up getting a Raw Deal.
Daddy Ken, when did the Patriots give up the reigns of free capitalism to the Socialists and Progressives?
Unfortunately, the day Black lives really mattered--the War between the States. Our Constitution naturally recognized the natural rights to liberty and freedom for every man. However, there were many--White, Black, and Native American--that perverted our economy with slave labor and our politics with tyranny. Yes, children, Blacks, and Native Americans owned slaves too! These perversions of economics and politics were an offense to those that respected our Preamble's intent, "We the People of the United States, in Order to form a more perfect Union..." In the Civil War, the Democrats fought to maintain slavery in their states and those destined to become states. The Republicans sought the greatest economic and political embargo by abolishing slavery in all of the states. During this time, President Abraham Lincoln sought a process that would cover the debts of the Civil War and fully fund the military. He was quite successful in achieving each through the levy of income taxes. The first time in American federalism that such an activity took place. Lincoln got Congress to pass the Revenue Act of 1861 thus, creating the Bureau of Internal Revenue and collecting taxes both domestic and foreign. The income and property taxes were deemed essential as a result of the Civil War. The Lincoln Administration and Congress passed it as a "National Emergency". During its 10 year existence, the Act allowed Congress to collect over $340 million. The Civil War Debts were completely paid off.
Knowing this, Americans began to question why any Congress or Administration would maintain the tax. Due to its unpopularity, Congress finally repealed income taxes in 1872, although the Revenue Act of 1862 required the termination of income and property taxes by 1866. Why the additional years? Political leaders liked the new found power and influence that they had over the American economy. They could promise to spend based on ideal pictures of tax revenue growth thus, creating budget deficits and national debt. The greater the wealth confiscated, the more powerful legislatures would become in picking winners and losers in the economy. The greatest champions of the federal power to tax income were the Progressive Republicans, Democrats, and Socialists. In 1867, the Socialists demanded a graduated income tax. In 1892, the Populist Party, which would later merge with the Democrat Party, demanded a graduated income tax through its Party Platform. In 1894, Democrat William Jennings Bryan, three-time losing Presidential candidate, advocated for the passage of the income tax. On May 21, 1895, the U.S. Supreme Court ruled that a direct tax on personal income was unconstitutional as a result of the case of Pollock v. Farmers‘ Loan and Trust Company. The lawsuit had been precipitated by the 1894 Income Tax Act. The Supreme Court’s 5-4 decision stated that a “direct tax” on the “income of real and of personal property” was “unconstitutional and void.” This only strengthened the resolve of the progressives and socialists to make income taxes law constitutional and replace Supreme Court originalists with modern pragmatists.
Where were the Republicans, little ones? In 1902, House Ways and Means Committee Chairman Sereno Payne (R-N.Y.) led a conservative charge to repeal the Spanish-American War tax and several others. This did not sit well with Socialists, Establishment Democrats, and Progressive Republicans. They were completely upset that "capitalists and corporatists" were not paying their "fair share". In a speech on April 14, 1906, President "Teddy" Roosevelt endorsed a progressive estate tax:
"Of course no amount of charity in spending such fortunes in any way compensates for misconduct in making them. As a matter of personal conviction, and without pretending to discuss the details or formulate the system, I feel that we shall ultimately have to consider the adoption of some such scheme as that of a progressive tax on all fortunes, beyond a certain amount either given in life or devised or bequeathed upon death to any individual — a tax so framed as to put it out of the power of the owner of one of these enormous fortunes to hand on more than a certain amount to any one individual; the tax, of course, to be imposed by the National and not the State Government."
The Progressives, the Socialists, and the Democrats were in lockstep. Successful Americans would be targeted with the tax pen.
Daughters, you are so perceptive. I know your mother sleeps but, I will raise the volume slightly and project my voice more. Whether Lincoln or the Roosevelts, the Progressives, the Socialists, and the Democrats understood that centralizing economic planning in Washington, DC offered federal legislatures greater power and influence than any individual state legislator could possibly muster. There was an additional secret weapon that they could call upon. In the 1862 Revenue Act, Congress gave provision for the deduction of state and local taxes. Their rationale? A fear that high levels of federal taxation might “absorb all [the states’] taxable resources.” Such a rationale reveals the motives of the income tax advocates. They were going to coerce, by excessive tax laws, the American citizen to accept greater government intervention into their everyday lives. It would no longer be "We The People" but, become "We The Government".
The Income Tax Power Lobbyists realized that the deduction of state and local taxes allowed high tax, high-income states to gain the greatest protections for their ideological pursuits. The states with the highest taxes are  New York, $9,718;  California, $9,509;  Nebraska, $9,450;  Connecticut, $9,099; and  Illinois, $9,006. The majority of these are Leftists states that subscribe to many Anti-American legislated policies. The Left realized that they could pass their public policy experiment costs unto the rest of America through high taxes. Wealthy taxpayers love it because it lowers their overall tax due. States love it because it makes it easier for legislators to express support for costly bills. Advocates love it because the public policy costs are passed on to others and not incurred in full by the citizens that enforce their recommendations. In many of these states, conservatives have very little influence and certainly very few choices.
If the Congress would eliminate the deduction of state and local taxes then, taxpayers would be forced to hold their legislatures to higher fiscal standards. Progressives and socialists might reconsider their ways. They just might surrender their ideological pursuits for the financial good of the common man. Voters may accept a more conservative fiscal policy for their states and cities. Wow, actually, this might make it easier to vote conservatives into a political office where states and cities are most liberal. The Conservative Movement may prevail in California, in New York, and in Illinois. Unions, environmental groups, and progressive and socialist defenders may lose their lobbying power in Washington, DC. K Street may finally bow to the power of Main Street...
All heads turn and there is utter silence.
A lovely woman with a frown stands at the door of my home office. She gives me and the girls "The Look". Men, if you have never seen "The Look" let me forewarn you, do not ask for it or desire seeing it. "The Look" is at once debilitating and dehumanizing. "The Look" can crush cans without human effort. It makes young men weep and old men tremble. All sounds ceased. I do not know how the television screen faded to black but, it seemed to know the presence of my wife and, I suppose, it did not want to subject itself to viewing "The Look". The girls escaped between "The Look" and the doorway as if they had been kidnapped and were happy to see the SWAT team arrive.
It was years before I understood that my daughters were not interested in the Constitution, Economics, or American politics. Let's hope it's not years before Congressional conservatives realize that breaking the Left's political hold on High-Tax, High Income Tax states and economic hold on the U. S. Treasury is as simple as eliminating the state and local taxes deduction. Manipulation is a wonderful thing for the manipulator. Wisdom is the key to freedom for the oppressed. I pray that Congress is wise enough to use the key to free Americans from the oppression of the Left. However, to believe so would be a maddening deception. I no longer wish to be manipulated, except by my daughters.
is an Urban Conservative Whose Mission Is to
Spread the Good News of Christianity, Conservatism, Capitalism, Constitutionalism,
and Individual Sovereignty throughout the World.
Devoted to Life, Liberty and the Pursuit of Happiness, He Believes that in
Order to Save the United States, We Must Mutually Pledge Our Lives, Our Fortunes,
and Our Sacred Honor to Save Urban America.