Something very important is lost in the debate over Donald Trump’s so-called tax overhaul.
The biggest concern for politicians is whether the overhaul will result in a net loss of revenue for the government. This implies two things: 1) that the money belongs to the government; and 2) that the government could not function with less money. Neither of these is true.
Government men were very crafty when they invented the income tax withholding. It accomplished the goal of “easing the burden” on taxpayers by taking their money from them before they saw it. I’m convinced that if every wage earner had to write a check to the government to cover his taxes every month, quarter or year, there would be a revolt in this country.
And by creating the system of filing taxes at the end of the year, government men established the notion that if one had “over-paid” his taxes and got a refund, the magnanimous government was giving the taxpayer a gift when, in fact, the taxpayer was getting back money stolen from him and used interest-free by the government.
This conversation about taxes is all wrong. And this is by design. The messengers (propagandists) of the elites want it that way.
First of all, what is truly necessary to fund government; or, better yet, what is necessary government that must be funded? These are questions that are not asked. Politicians won’t address these questions because their goal is to accrue more power over the people through government. Politicians never relinquish power, and government never shrinks.
Think for a moment. In 2000, President Bill Clinton submitted a budget of $1.9 trillion for the 2001 year. Do you recall hardships, starving children, neglected old people or a military with antiquated weapons that year?
In coming days you will hear the familiar canard about “tax cuts for the rich.” But IRS data shows that taxpayers with higher incomes pay much higher average individual income tax rates than lower-income taxpayers.
As the Tax Foundation notes:
The bottom 50 percent of taxpayers (taxpayers with AGIs below $38,173) faced an average income tax rate of 3.45 percent. As household income increases, the IRS data shows that average income tax rates rise. For example, taxpayers with AGIs between the 10th and 5th percentile ($133,445 and $188,996) pay an average rate of 13.7 percent – almost four times the rate paid by those in the bottom 50 percent.
The top 1 percent of taxpayers (AGI of $465,626 and above) paid the highest effective income tax rate, at 27.2 percent, 7.9 times the rate faced by the bottom 50 percent of taxpayers.
- In 2014, 139.6 million taxpayers reported earning $9.71 trillion in adjusted gross income and paid $1.37 trillion in individual income taxes.
- The share of income earned by the top 1 percent of taxpayers rose to 20.6 percent in 2014. Their share of federal individual income taxes also rose, to 39.5 percent.
- In 2014, the top 50 percent of all taxpayers paid 97.3 percent of all individual income taxes while the bottom 50 percent paid the remaining 2.7 percent.
- The top 1 percent paid a greater share of individual income taxes (39.5 percent) than the bottom 90 percent combined (29.1 percent).
- The top 1 percent of taxpayers paid a 27.1 percent individual income tax rate, which is more than seven times higher than taxpayers in the bottom 50 percent (3.5 percent).
That’s because income taxes are not necessary to fund government. Government has a printing press and can print money to infinity.
For 100 years the lie has promulgated that income taxes fund the government. Americans are taught from an early age to be a good “taxpayer” and to pay their “fair share.” This lie has gone so far that now the majority of the people buy into the notion that the government gets first dibs on our money and can withhold the amount that it deems is our fair share.
It has become so ingrained in the American experience that some companies have major marketing campaigns every year focused on getting “taxpayers” to use their refunds to buy things.
Using words spoken by Beardsley Ruml, chairman of the New York Federal Reserve from 1941 to 1946, we can dispel the widely believed myth that income taxes are needed for government income. Income taxes actually have nothing to do with providing income to the government.
In a famous speech he read before the American Bar Association during the last year of World War II, titled “Taxes for Revenue Are Obsolete,” Ruml said, “The necessity for a government to tax in order to maintain both its independence and its solvency is true for state and local governments, but it is not true for a national government.”
The speech was originally printed in “American Affairs” in the January, 1946 issue. The editor of “American Affairs” wrote: “His [Ruml’s] thesis is that given (1) control of a central banking system and (2) an inconvertible currency, a sovereign national government is finally free of money worries and need no longer levy taxes for the purpose of providing itself with revenue. All taxation, therefore, should be regarded from the point of view of social and economic consequences.”
You can read the entire speech and see for yourself.
In a similar vein, former Federal Reserve Bank of St. Louis President Darryl Francis had this to say in 1974:
“Since the direct method of printing money to finance government expenditures is prohibited in the United States, the monetization of government deficits has occurred indirectly. Government debt is ultimately being financed by the creation of new money.”
In other words, the U.S. tax system is a system of social engineering to control and redistribute the volume of “money,” and data mining.
Years of study and observation tell me that not one person in a million understands the income tax. The income tax is probably the greatest deception and fraud in history, because it is the foundation of a private monetary system. The very few who do understand vomit every time they hear the word “democracy.”