Italics are mine – Frank Trejo – Yesterday’s News Today
The following article by Ed A. Ellison and John William Kurowski written in 1984 and posted by the Justice Times might have been a good answer to the debt problem in our country. But many didn’t see this other than people in the “freedom movement.”
STATE RATE TAX WILL BALANCE BUDGET
Unlike any of the political party gimmicks and schemes currently being offered by career politicians, the State Rate Tax is part of a plan to remedy outright dishonesty, now practiced by the Congress of the United States. As you will see, this plan is not simply another tax proposal, nor a political party creation to maintain the current status quo. It is a revolutionary concept to introduce checks and balances linked to taxation, which will terminate reckless spending by Congress; arrest year end deficits accumulated by Congress; and, preclude inequitable taxation which has been institutionalized by political party loyalists.
Under this plan, the Control of Congress is in part achieved by immediately requiring all federal expenditures to be met by indirect taxation, imposts, duties and excises. Imposts are taxes imposed on imported goods or merchandise; duties are custom charges levied on things brought into the country; excise taxes are inland impositions upon articles of consumption (alcoholic beverages, cigarettes, gasoline, etc.) manufactured for sale or consumption within the country. Excise taxes may also be imposed on illegally earned income (gains or profit); upon income earned through a specific privilege which government has been delegated power to authorize.
The theory behind funding government functions from taxes laid upon articles of consumption, is that citizens are to be free to contribute to government in the manner and frequency by which they spend their money. Taxes on articles of consumption, it must be noted, contain their own check and balance against political corruption, and are the least oppressive of all taxation. A tax on articles of consumption, says Hamilton, number 21 Federalist:
“…may be compared to a fluid, which within time find its level with the means of paying them. The amount to be contributed by each citizen, will in a degree, be at his own option, and can be regulated by an attention to his resources. The rich may be extravagant, the poor can be frugal; and private oppression may always be avoided by a judicious selection of objects proper for such impositions. (I)t is a Signal advantage of taxes on articles of consumption that they contain in their own nature a security against excess. They prescribe their own limit, which cannot be exceeded without defeating the end proposed – this is an extension of the revenue.”
If any particular article of consumption is excessively taxed, it would reduce the volume of its sales and the raising of revenue would be eluded. This check and balance will determine the limit to which each selected article may be taxed. By forcing Congress to select specific articles of consumption, as opposed to a blanket national sales tax, a system of taxation is achieved in which the general public may actively participate in the selection of the specific articles to be taxed, and, to what degree they will taxed.
If, for example, Congress laid a twenty dollar per pound tax on all imported caviar sold in the United States, (an excessive tax even for a luxury article) the wealthy, and merchants dealing in this product would undoubtedly cry “foul” and withdraw their political support from those representatives responsible for the opposition of an excessive tax on caviar. If, however, the tax were moderated to tolerable level, the purchaser’s resistance would also diminish and revenue would be generated!
Another important advantage to labor and industry, when revenue is raised by taxes on specific articles of consumption, is that the necessities of labor (food, shelter, clothing, etc) tools of production, and supplies necessary to conduct business may be excluded from the tax list. This will allow industry and business to flourish unimpeded by taxation; employment to expand, and the welfare of our States’ commerce to be actively protected from oppressive taxation.
Under the proposed State Rate Tax plan, the expenses of the federal government – those specifically authorized by the Constitution of the United States, which are clearly enumerated and subjoined to Article 1, Section 8, Clauses 2 through 18 – are to be founded by indirect taxation! If the annual expenditures for these constitutionally authorized functions of Congress exceed the revenue raised from imposts, duties and excises, then, and only then, shall Congress be required to impose the State Rate Tax in order to preclude Congress from adding a year end deficit to the national debt.
The State Rate Tax is a direct tax required to be imposed if an annual deficit occurs. This tax is to raise a sum certain (annual deficit) and each states’ share is to be calculated upon its number of representatives (votes) in Congress. The tax is to be used only if imposts, duties and excises fail to meet Congress’ annual expenditures.
Upon imposition of the State Rate Tax, the Secretary of the United States Treasury, to extinguish an annual deficit, would submit a bill to each state’s capitol for its apportioned share of this deficit. Each state would be left free to raise its apportioned share within a time specified by Congress. In the event there is a surplus of money in the United States Treasury at the close of a fiscal year (i.e. there is no deficit) this surplus would be applied to a sinking fund to reduce or extinguish the national debt. If there is no deficit, nor a national debt, any surpluses raised from imposts duties and excise taxes may be returned to the states by the rule of apportionment.
STATE RATE TAX SAVES AMERICAN CITIZENS BILLIONS
The annual cost of maintaining a federal income tax collection agency (IRS) whose budget is about $3 billion, would be almost totally abolished, and the annual cost to the nation, both in time and resources, to record confidential financial transactions of our nations’ entire population, under a pretext of raising revenue, would also be ended by the State Rate Tax.
POLITICAL DISUNTIY IN AMERICA REDUCED
The State Rate Tax, because it is a tax imposed upon the state governments by a fixed formula, and not upon people or their property, will abolish the present system of federal income taxation and all the dishonorable tax sheltering gimmicks and lobbying of Congress to create special interest tax legislation. Special interest tax legislation has caused a dangerous rise in political factions throughout America, and has led our nation to become politically disunited. By establishing a fixed rule for direct taxation, there is no allowance for political disunity to be bred through the creation of tax loopholes and special interest tax sheltering gimmicks created by Congress. This will help to bring the States closer together to solve America’s real social and economic problems, and reduce political disunity bred among the people by Congress.
RELIGIOUS LIBERTY PRESERVED BY STATE RATE TAX
In view of the alarming development recently occurring in our nation, by which the power of taxation has been blatantly used to control and regulate into extinction a number of small fundamentalist churches and their schools, the State Rate Tax will come as a blessing to our nations’ religious community; it will preserve their religious freedom guaranteed by the First Amendment of our Constitution and shield the Amendment from being weakened under the cloak of raising revenue.
STATE LEGISLATURES BEST JUDGES IN RAISING DIRECT TAX
There is no question as to a states legislature being the best judge as to the mode of raising a federally imposed direct tax. The State Legislature being closer to the people, is better informed to disburse such a burden in an equitable manner, taking into account unique geographical and economic circumstances, and molding taxation accordingly. The State Rate Tax allows each State to be its own judge in deciding how its share of this federal burden shall be raised, and will protect all people, rich and poor alike, from the costs of the federal government being raised and collected by Congress in an unjust, arbitrary manner; it puts the control of such an important and personal matter into the hands of the peoples’ local representatives who must meet this obligation.
Under this plan a balance is achieved in which equitable taxation will be the final result. If a state government should impose inequitable taxation, even if it is only resorted to when raising a states’ share of the apportioned direct tax imposed by Congress, and the state government insists on distributing its burden selectively upon the States’ productive citizens or its small businesses at rates which become intolerable. These citizens, or small businesses, are able to flee from such taxation to states whose administrations respect the productive members of society, and which offer equitable systems of raising revenue.
The freedom of a states’ business community to flee oppressive taxation is an important check and balance to prevent the power of taxation being used to destroy. As it is now practiced, productive citizens have no where to flee to escape federal taxation, and so, Congress is left to engage in mischief and manipulate taxation so as to seek out hard working wage earners, or small businesses, asking them to pay a disproportionate burden of federal expenditures, regardless of where they may live.
OPPOSITION TO THE STATE RATE TAX
Those in opposition to the State Rate Tax claim the system would place an unfair tax burden upon those states having the greatest voting strength in Congress. The fact is, the State Tax Rate is not to be imposed except upon dire emergency as previously outlined, and indirect taxes are to be Congress’ primary source of revenue. However, the states having the larger voting strength in Congress, are required to pay a proportionate share of this direct tax based upon their larger voting strength, will also have a greater say in the policies Congress adopts, and a larger population to absorb their burden if the State Rate Tax is imposed.
By matching each states’ share of the direct tax to its voting strength, no state can use its voting strength to increase the burden of taxation upon other states without also increasing its own burden of taxation in a similar fashion! Thus, the voting strength of each state can in no way be used as an economic advantage when the State Rate Tax is invoked; each state pays according to its voting strength as required by Article 1, Section 2, Clause 3; Article 1, Section 9, Clause 4 of the United States Constitution, and this was the intention of our Founding Fathers.
IN CONCLUSION (finally!)
Congress has never been granted a blanket power or unlimited power to tax the people. Congress has no power to directly tax one, for the benefit of another, a violation of voluntary association; nor a power to be benevolent at home or abroad at the expense of the American citizen through a tax on his money (property) or other property. Our Founding Fathers gave us a free country and meant for us to remain free, and gave us the tools with which to keep us free. The tools of the Constitution and the checks and balances it provides are to protect the sovereignty of the Citizen.
There has never been a grant of power from the people to the Congress to tax the people of the United States. The State Rate Tax is the constitutionally provided limited power of direct taxation permitted to Congress by the will of the people. And, we will continue to suffer as a nation until we demand our Constitution be followed…end of article
Whew! That was a lot. But importantly, it is historical information that gives you an insight as to how our Founding Fathers gave thought to complex issues of taxation. Unfortunately, things have gotten so out of hand that the only answer, I think is to declare bankruptcy, repudiate all debt, get rid of the Federal Reserve, reduce government to things specified in the Constitution, get rid of government controlling our schools, teach our young the Bill of Rights, repeal the 17th Amendment and put us back to a constitutional monetary system – absent the International Bankers. Of course, there is much more but we can’t continue living under a system without law and order. All the perplexities that abound are what we get in a “democracy” – the worse form of government. Constitutional government is the answer. We must defeat the Democrats in Nov.
You may consider forwarding this to your elected representatives it may trigger new thought…I love you America.
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