789 Responses

Ron Paul supports the elimination of the income tax and the Internal Revenue Service (IRS). He asserts that Congress had no power to impose a direct income tax and has introduced legislation to repeal of the 16th Amendment to the Constitution, which was ratified on February 3, 1913.

An income tax is the most degrading and totalitarian of all possible taxes. Its implementation wrongly suggests that the government owns the lives and labor of the citizens it is supposed to represent. Tellingly, “a heavy progressive or graduated income tax” is Plank #2 of the Communist Manifesto, which was written by Karl Marx and Friedrich Engels and first published in 1848.

To provide funding for the federal government, Ron Paul supports excise taxes, non-protectionist tariffs, massive cuts in spending.

Ron Paul discusses the income tax and the “FAIR Tax” in May 2007:

On November 20, 2008 Ron Paul said in a New York Times / Freakonomics interview:

“I want to abolish the income tax, but I don’t want to replace it with anything. About 45 percent of all federal revenue comes from the personal income tax. That means that about 55 percent — over half of all revenue — comes from other sources, like excise taxes, fees, and corporate taxes.

We could eliminate the income tax, replace it with nothing, and still fund the same level of big government we had in the late 1990s. We don’t need to “replace” the income tax at all. I see a consumption tax as being a little better than the personal income tax, and I would vote for the Fair-Tax if it came up in the House of Representatives, but it is not my goal. We can do better.”

On May 7, 2001, Ron Paul wrote the following column:

The Case Against the Income Tax

Could America exist without an income tax? The idea seems radical, yet in truth America did just fine without a federal income tax for the first 126 years of its history. Prior to 1913, the government operated with revenues raised through tariffs, excise taxes, and property taxes, without ever touching a worker’s paycheck. In the late 1800s, when Congress first attempted to impose an income tax, the notion of taxing a citizen’s hard work was considered radical! Public outcry ensued; more importantly, the Supreme Court ruled the income tax unconstitutional. Only with passage of the 16th Amendment did Congress gain the ability to tax the productive endeavors of its citizens.

Yet don’t we need an income tax to fund the important functions of the federal government? You may be surprised to know that the income tax accounts for only approximately one-third of federal revenue. Only 10 years ago, the federal budget was roughly one-third less than it is today. Surely we could find ways to cut spending back to 1990 levels, especially when the Treasury has single year tax surpluses for the past several years. So perhaps the idea of an America without an income tax is not so radical after all.

The harmful effects of the income tax are obvious. First and foremost, it has enabled government to expand far beyond its proper constitutional limits, regulating virtually every aspect of our lives. It has given government a claim on our lives and work, destroying our privacy in the process. It takes billions of dollars out of the legitimate private economy, with most Americans giving more than a third of everything they make to the federal government. This economic drain destroys jobs and penalizes productive behavior. The ridiculous complexity of the tax laws makes compliance a nightmare for both individuals and businesses. All things considered, our Founders would be dismayed by the income tax mess and the tragic loss of liberty which results.

America without an income tax would be far more prosperous and far more free, but we must be prepared to fight to regain the liberty we have lost incrementally over the past century. I recently introduced “The Liberty Amendment,” legislation which would repeal the 16th Amendment and effectively abolish the income tax. I truly believe that real tax reform, reform that so many frustrated Americans desperately want, requires bold legislation that challenges the Washington mind set. Congress talks about reform, but the current tax debate really involves nothing of substance. Both parties are content to continue tinkering with the edges of the tax code to please various special interests. The Liberty Amendment is an attempt to eliminate the system altogether, forcing Congress to find a simple and fair way to collect limited federal revenues. Most of all, the Liberty Amendment is an initiative aimed at reducing the size and scope of the federal government.

Is it impossible to end the income tax? I don’t believe so. In fact, I believe a serious groundswell movement of disaffected taxpayers is growing in this country. Millions of Americans are fed up with the current tax system, and they will bring pressure on Congress. Some sidestep Congress completely, bringing legal challenges questioning the validity of the tax code and the 16th Amendment itself. Ultimately, the Liberty Amendment could serve as a flashpoint for these millions of voices.

Ron Paul introduced the Liberty Amendment in 1998, 1999, 2003, 2005, 2007 and 2009. It is currently know as H. J. RES. 48 and has 2 cosponsors, Roscoe G. Bartlett (MD-6) and Don Young (AK). Here is the text of the proposed amendment:

Liberty Amendment

Section 1. The Government of the United States shall not engage in any business, professional, commercial, financial, or industrial enterprise except as specified in the Constitution.

Section 2. The constitution or laws of any State, or the laws of the United States, shall not be subject to the terms of any foreign or domestic agreement which would abrogate this amendment.

Section 3. The activities of the United States Government which violate the intent and purposes of this amendment shall, within a period of three years from the date of the ratification of this amendment, be liquidated and the properties and facilities affected shall be sold.

Section 4. Three years after the ratification of this amendment the sixteenth article of amendments to the Constitution of the United States shall stand repealed and thereafter Congress shall not levy taxes on personal incomes, estates, and gifts.’.

On April 30, 2009 Ron Paul introduced the Liberty Amendment with the following speech:

Ron Paul: Madam Speaker, I am pleased to introduce the Liberty Amendment, which repeals the 16th Amendment, thus paving the way for real change in the way government collects and spends the people’s hard-earned money. The Liberty Amendment also explicitly forbids the Federal government from performing any action not explicitly authorized by the United States Constitution.

The 16th Amendment gives the Federal government a direct claim on the lives of American citizens by enabling Congress to levy a direct income tax on individuals. Until the passage of the 16th amendment, the Supreme Court had consistently held that Congress had no power to impose an income tax.

Income taxes are responsible for the transformation of the Federal government from one of limited powers into a vast leviathan whose tentacles reach into almost every aspect of American life. Thanks to the income tax, today the Federal government routinely invades our privacy, and penalizes our every endeavor.

The Founding Fathers realized that “the power to tax is the power to destroy,” which is why they did not give the Federal government the power to impose an income tax. Needless to say, the Founders would be horrified to know that Americans today give more than a third of their income to the Federal government.

Income taxes not only diminish liberty, they retard economic growth by discouraging work and production. Our current tax system also forces Americans to waste valuable time and money on compliance with an ever-more complex tax code. The increased interest in flat-tax and national sales tax proposals, as well as the increasing number of small businesses that question the Internal Revenue Service’s (IRS) “withholding” system provides further proof that America is tired of the labyrinthine tax code. Americans are also increasingly fed up with an IRS that continues to ride roughshod over their civil liberties, despite recent “pro-taxpayer” reforms.

Madam Speaker, America survived and prospered for 140 years without an income tax, and with a Federal government that generally adhered to strictly constitutional functions, operating with modest excise revenues. The income tax opened the door to the era (and errors) of Big Government. I hope my colleagues will help close that door by cosponsoring the Liberty Amendment.

789 responses to “Taxes”

  1. Steven

    I loathe income tax (who doesn’t?) and I’m all too aware that the current tax rates could go away in 2011, but if we want to be taken seriously then we need to get our facts straight. The reality is that the average American does not pay over one-third of their earnings to income tax. To hit the highest bracket in 2010 you have to make over $373650, at which point you will have paid $108421.25 to income tax. That means you have given the feds 29% of your hard earned money. Then you pay 35% on everything over the $373650. Know much you have to earn to truly pay over one-third of your income to federal income tax? $1,350,000. At that point you have given 33.34% of your money to the IRS, $450,143.75 to be exact. This also assumes you have no deductions. Like all Libertarians, I believe the income tax should be repealed and the federal government reduced to one-quarter of it’s current size, if not smaller. I’m also certain that when you add in sales tax, luxury tax, property tax, et al., we do pay over one-third of our income to taxation. But we can not go on quoting ‘the average American pays over one-third of their income to the federal government’ if that statement is inaccurate. Now we sound like the propogandists, spouting false statements to get people on our side.

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  2. Terry

    My household makes approximately 55,000 gross a year. Claiming married with 2 kids, we pay probably 2000 a year in income tax and get back about 700. I have a friend that makes about 38000 a year reportable (and probably another 10 to 12 under the table) while his wife stays home and raises five kids (7 total household). I’m not sure what they pay in (probably around 1500) but I know they get about 6000 back, probably more. Now tell me that is right. Nope, that is the state of our income tax system. The rich and the middle class are not only paying for the federal government, but also PAYING the lower middle class and the poor to have kids! Something really needs to change. And I am not being a hypocrite. I have benefitted from our income tax system in the past and did not think it was right then either. Of course, I didn’t send the money back, so maybe I am a hypocrite?

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    1. steve

      Why do you think you are liable for income tax? You should check out IRC sections 3401, 3121, 7701. These sections define who is liable for the income tax (an excise tax).

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  3. David

    Grab your rifles and go hunting America ! Is this Treason or what ?

    August 3, 2010 at 1:14 pm | Permalink | Reply Report comment Report comment

    Hi Again Ross :)

    Well at this point, instead of putting numbers and statistics in front of people, i’ve been concentrating my efforts on simply making them aware of some of the ideas and concepts essential to establishing the free economy and abundant prosperity they are entitled to, the things which have been preventing this thus far and giving them the ideas which they need to think about in order to motivate them to make this happen for themselves.

    What we need is for someone here, who’s better at finding and comparing the statistics for the US than i am to post them here so we can supplement the concepts with them as well, but then statistics like this don’t even come close to illustrating the severity of the problem either and here is the reality of it and the real statistics as they effect the average person in America today. Everyone knows the current situation through their own experience, and I have a nephew who works as a police officer in a city close to me here, and his situation would be typical of the vast majority of people living and working in most American cities. His gross salary is around $ 40,000 a year which would equate to about $ 3,300.00 a month. Out of that, over $ 2,000 goes to the bank every month in mortgage / interest payments on his house so that he can maintain a place to live and will for the next 30 years. Of the $ 1,300 that’s left, assuming a 20 % income tax level, another $ 600.00 goes to the government so they can pay the banks for creating the currency they need to function which they should have created for us and themselves, leaving him with $ 700.00. Of that $ 700.00 another $ 49.00 goes up in sales taxes to fund the state government who also loan the money for their operations from banks. Of the $ 651.00 that’s left at least $ 100.00 a month goes up in property taxes which he has to pay in order to keep his place to live, which goes to the county and city government which again loan the money for their operations from banks. This finally leaves him with only $ 551.00 to spend and inject back onto circulation in order to generate useful production which can benefit himself and the rest of us.

    Total Monthly earnings:
    $ 3,300.00
    Total consumed by banks and because of banks in order to buy power and ownership over America and its population for themselves:
    $ 2,749.00
    Total being spent into the economy to generate useful production for the benefit of the American population:
    $ 551.00

    This is what we got, and that is what the banks got. Is there one single F’ing idiot anywhere who can still believe and can try to explain how such a system can be sustainable, or possibly benefit the people it is intended to serve ?

    What would the standard of living for each and every person in America be today if we didn’t have banks and the governments they establish, who neither build anything, fix anything nor feed anyone, consuming 5/6ths. of our capacity to pay for and generate useful production for our own benefit ?

    6 times what it is today.

    Whom does the current American economy and political establishment exist to serve ?

    I’ll leave that for everyone to answer for themselves.

    Ross let me know how this compares to the situation in Australia, everyone else get out your checkbooks and calculators and figure this out for yourselves. Then copy, paste and forward this thread to absolutely everyone you know so that they can do the same.

    Thanks again Ross :)

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    1. fred the protectionist

      “Grab your rifles and go hunting America ! ”

      You Libertarians are all mouth.

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      1. David

        Oh just wait Fred, their all starting to figure this out at the same time now and for the ones who haven’t, they will when they see this. Its being forwarded across the country as we speak and there’s nothing you or forest can do about that.

        Personally, i don’t give the banks a year, and if the bankers have any brains they better give up and get out now while they still can, were coming for them, all 350,000,000 of us.

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  4. Omega

    Why oh why did the people chose Obama instead of Paul who obviously knows what he’s doing. Obama’s resume wasn’t even acceptable.

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  5. David

    Cross posting from the “Sound Money” blog. Absolutely everyone needs to see, read and understand this, and then do their part in order to get the information to others to see read and understand as well. This is the single and only thing anyone needs to be worried about now and the solution to all other problems too.


    June 16, 2010 at 9:05 pm | Permalink | Reply Report comment Report comment

    I love the replies. I am so glad I’ve got the attention of some. Our job is not complete yet. We need more to understand.

    Talk about sticking our neck out? It is worth it for you!

    I am doing it for my children, their children, you, and everyone you know, even though I do not know them, neither did my forefathers, when they stuck their neck out for those they did not know. I’m trying to carry on that tradition. It seems to be lost now day, because of fear. I am not afraid.

    They can do to me what they want if that satisfies them. But, another will fill my shoes, if I go. This is a Divine plan, not mine.

    I cannot take the credit. I hope you understand.
    There is more than one of me. My teacher, is the best.

    I just look forward to meeting Thomas Jefferson, Andrew Jackson, and the many who battled this. Crazy? I don’t think so.

    My friends and I have quite a few years into reseearch to find this.
    It just goes to show, what a man, men, woman, or women will do what pushed against the wall.

    If we can only unite in masses, we can accomplish this.

    I just posted another article called “Suspense Account”
    Homeowner – Investor
    May They Never Meet

    This should get the investors attention.
    If we can get homeowners and investors to realize this, the banks will be hit from both sides. not just one.

    We have pushed this out to the Tea Party, and to the Liberal party, to help those who want to stop this madness. As you may see, I am reserved as to who I am in favor of. It will take one hell of a sales pitch for me. Pardon the language.

    We want those who will take out country back, and get the greed out.
    Enough is enough.

    God Bless America

    “Vote Greed Out” “Vote Trust In”
    Vote in November


    June 17, 2010 at 12:27 pm | Permalink | Reply Report comment Report comment

    This is a beautiful statement, and what you have done here is describe my own thoughts perfectly along with those of many others here as well, and also those of this countries founding fathers.

    What you have described here is love, “Greater love has no man than that he would be willing to lay down his life for a friend”. This is the single and only country in this entire world which has been established by love, and for the purpose of bringing the natural freedoms and prosperity to its population which all people should be entitled to, as all others have always existed simply to serve someone’s lust for power. Each and every one of this nations founding fathers had this love and was prepared to make this sacrifice in order to accomplish this as well, and its a good thing to see that there are still some of us who would be willing to do the same in order to preserve and build on what they established.

    These men warned us time and again about what would happen if we were to tolerate a banking system in this country, and Jefferson probably stated it best in that “the children would wake up homeless in the land that their fathers conquered”. This was not their belief, or an economic theory, but a simple statement of fact which they knew to be true, and its about time that everyone today comes to understand this as well. No country or society can survive for any length of time while tolerating any form of private interest on money, and will not survive for anything but a very short time while allowing private control and issue of its currency. This is an extremely insidious thing which should have been obvious to everyone from the very beginning, but evidently is only becoming apparent to a few as we speak. The simple fact is that for as long as banks have the power to issue money and credit and collect interest on what they issue, the single and only thing which can happen, is that they will incrementally gain control of more and more of the nations resources and property as time goes on and the single and only possible result is that eventually they will have accumulated all of it leaving the population with absolutely nothing, which is exactly the point which we are reaching now, and if something isn’t done about this very soon, this end result will be a permanent condition as well as they will have established the power to keep it so.

    If the motivation was simple greed, it would not be such an evil thing, as someone who simply wants a lot for themselves has no reason to deny that prosperity to another person as well, and for anyone attempting to establish prosperity through any form of useful production or service, the prosperity of others is absolutely essential to this, as people need to have the means to purchase that useful production or service in order for it to accomplish anything for anyone, and hence everyone wins. For banks though, they provide absolutely nothing of any tangible value for anyone, and the single and only means they have to survive and prosper, is to maintain and increase their power over the population so that they can continue to force the population to keep feeding them through interest and taxes, and the single and only way to establish power is to make the population poor and dependent on those who establish the power, to the extent where both the power and poverty will be absolute. Hence, the only possible result of the current form of capitalism is socialism, which is it final evolution, both of which come from the same place and have been invented by the same people, as a means to first establishing and then finally securing the power they crave.

    The single and only legitimate means for any person to establish prosperity for themselves, is to provide some form of useful production or service which can actually benefit another person, in which case that other person will be willing to work and pay for that production or service in order to receive the benefits that it can provide for them. If an economy exists and is administered for the single and only purpose if facilitating and maximizing such useful production and services, the only possible end result can be ever increasing prosperity for the entire population and the more prosperity which is established for the people who are doing this, the greater the number of people who will have the opportunity to do the same by contributing their own useful production and services to the benefit of the rest. The only possible result of this is that the overall prosperity of the general population must keep increasing geometrically, and that this society will survive and become ever more free and prosperous for all time to come, simply and only through the population having the means to facilitate the use of their natural abilities to make it so for each other, and as such, everyone wins.

    The only other means for a person to establish prosperity for themselves is through the establishment of power by which they can force someone else to work and contribute to their prosperity while providing nothing of any tangible benefit to them in return. Absolutely every form of business that exists in this country which derives its profits from manipulating money without actually producing or doing something of tangible benefit that other people can actually use, falls into this category, and, as opposed to useful production and services which actually benefit the person buying them, absolutely every nickel of prosperity that they gain for themselves, comes at the expense of someone else, and the more they make, the less that everyone else will have. As long as this power is tolerated, the single and only possible result can be the loss of all freedom and property by the population to the extent where they exist simply and only as livestock, who’s sole purpose in existing is to serve those who have established the power to make them do so, as short of contributing something useful to the benefit of others, this is the single and only means that any such individuals can survive and prosper. As such their very existence is an incredibly evil thing and comes at the expense of absolutely everyone except themselves.

    We’re dealing with two very simple and basic concepts here, there are only two in existence and everything that happens in this world is based on and motivated by these two things alone. These are freedom and power, which are essentially equivalent to good and evil. These are the two basic opposing forces in this universe, they simply cannot exist in the same space, and where one does exist, it will always be at the expense of the other. Accordingly, there are only two ways for anyone to establish prosperity for themselves. The first is for a person to use their natural abilities in order to contribute to the benefit of others, and the second is to establish power and control over currencies, economies and governments in order to force them into service through interest and taxes while making absolutely no such contribution to their benefit. Again, were back down to these two very simple, very basic concepts, freedom and power.

    We have tolerated power in our economy and political system for far too long, and every ounce of it which has been established has come at the expense of the freedom and prosperity which this nations founding fathers wished to establish for us through their love for their fellow man and all generations to come. We have only two choices here, we can either do nothing and allow the power to continue to the point where it consumes every ounce of freedom which has ever existed, in the single and only place in the world where it has ever existed, or we can act as a population, and destroy the power, absolutely and completely, allowing only freedom to remain in its place.

    Hopefully, between all of us who understand this, we can manage to beat it into the heads of all of those who don’t, what an incredibly simple thing this is and how extremely urgent it is for them to act in order to preserve and secure the freedom that they treasure but that most don’t understand, but without which their lives would become a completely worthless and intolerable thing.

    The only thing required for evil to prosper is for good men to do nothing. You are doing something, i am doing something, and many others are doing something as well. I only hope and pray that there will be enough doing something in order to avoid the single and only possible fate which has befallen every other society in this world which has tolerated a banking system, for as long as this is tolerated, there can be only one result, which is the destruction of all freedom with only power remaining in its place.

    We can only have one or the other and people have to choose. If the power wins, it will be over my dead body and yours as well, and we will have lost nothing as this is infinitely preferable to living without hope of ever accomplishing anything that could possibly make our lives a worthwhile thing, and if the freedom prevails, it will be you and i and those like us who are responsible for that, and for giving people the opportunity to use their natural abilities to make their lives a far more worthwhile and productive thing than they could have ever possibly imagined, as it is only banks and their power which have prevented them from being so thus far.


    Again, everyone, copy paste and forward these posts to absolutely everyone you can. On here we are simply preaching to the choir, and we desperately need to get things like this out there and circulating in order to motivate the general population to start thinking and understanding to the extent where they will be willing and capable of acting as well. This is the single and most important thing that we need to be doing right now, and i know that many of you are doing this already. Thanks for your help.

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  6. Yvonne

    The Fox propoganda team just proposed the solution to our economic woes.
    Apparently tax dollars are given to government workers.
    Workers. This means people who work…police/firemen/soldiers…..
    While paycheck may not be so high they get benefits.
    once the nation stops giving benefits(health coverage??) to govt workers we will save billions.
    So basically take from the ”WORKER”…again…find a working man/woman and figure out what we can take away.
    btw most of those gov’t workers are police/firemen/soldiers/teachers….take away their pensions and retirement money?
    Pension and retirement money comes out of their paychecks every week so now all the money that the workers have been handing over for pensions and retirements gets taken away…..???
    CEOs of big business and banks who we bail out get multi-million retiremen packages and none of it comes from their scarce weekly pay check.
    Police/firemen/teachers/soldiers get a weekly paycheck…not so big…and have a portion of it taken away so they can be given benefits…
    Now fox wants to take that away….
    Next segment they complain about journalistic equipment being taxed…I guess because some of the tax money might go to the hospital that is treating the fireman who has lung cancre from 911 or the soldier who needs a new leg because he was helping Fox’s friend Chene protect his interests overseas.
    Sure Fox.
    Take benefits away from firemen/police/soldiers/teachers….that’ll fix everything.

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  7. The Other David

    The U.S. Constitution is not the inerrant work of God. Many of America’s seemingly intractable problems are a consequence of its obsolete constitution. For example it is impossible for legislation to be passed by Congress unless it is laden with hugely expensive and usually unrelated earmarks. Vested interests turn most legislative initiatives into statutory freak shows. It is impossible to pass budgets which tackle debt the one and only true way that works – raising taxes and cutting expenditures. America desperately needs a cheaper, more effective medical care system. It didn’t get one. It is not just a political problem, however. Whether the Republicans or Democrats are in control, it makes no difference. The effect of the constitutional divisions of power is to preclude disciplined legislation.

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    1. Joan

      I agree. Glenn Beck is stuck on the Constitution is our only real law and that is isn’t a living document. He hates case law. Case law gives the common man power, which is what Beck is supposedly about. It has something to do with Joseph Smith, the man who created the Mormon religion, wanting to be president and wanting to run the country. Beck is stuck on the evil progressives want to take god out of government, as well it should be out of government, he’s stuck on the Constitution is the end all, and it’s not a changeable document. In reality, politicians make laws all the time and so do lawyers when they try new cases, the Constitution was amended, Rand Paul wants to amend it now to end anchor babies for illegals.

      I don’t get the part about religious folks hating Fox News. The people on MSNBC are the atheists, the talking heads on Fox are all very religious.

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    2. David

      The natural rights of man however, which consist of the natural right of each person to live their lives as they choose, with respect to the rights of others to do the same, and to utilize all of their natural abilities in order to contribute to each others benefit, are the inerrant work of god, the inerrant work of nature, the inerrant work of common sense and reason, or whatever it is that a person chooses to believe in.

      Although the United States Constitution is not an inerrant work in and of itself, it was established to protect these inerrant rights and freedoms, and those who established it, by their own admission, knew it was not inerrant, and left it to future generations to, through experience, eliminate whatever errors it contained, and expand on the protection of the natural freedoms and prosperity it attempted to provide, rather than to let people like this individual use these flaws as an excuse to abrogate the rights and freedoms which it does contain in order to establish further power for themselves.

      This guy has been moving around the blogs here, posting threats of consequences in defense of the Banking system, and trying to scare people into continuing to support them in their efforts to continue to progressively enslave our population as they have been doing incrementally for a great many years already. I’ve been following him around and countering his posts wherever he’s been posting, and have never received a response to as he simply cannot present any form of defensible argument in favor of maintaining the status quo. The only tool he has to use in order to accomplish this is to try and instill fear, which is the basis on which any form of power functions.

      Our banks and the politicians they have “elected” on our behalf are getting desperate, and the simple fact that they are sending people like this around to these blogs in order to try to scare people into maintaining their interests, is the best evidence we could possibly have of the absolute fear and terror they have of the American people.

      Now is the time and lets finish them off for good.

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  8. The Other David

    The anti-banking people on this blog have more in common with the communist idealists of the 19th century than with contemporary free enterprisers. The communist idealists thought that it would be possible to abolish money and. of course, along with that, the banks. After the 1917 Revolution there was a brief (and unsuccessful) effort to do exactly that. Communists also thought that after the revolution the state would “wither” away naturally because its purpose was to uphold the privileges of the rich. In the real world, however, the state became more powerful than ever. The old communists and the new Paulian libertarians have a common problem – reality. A banking system is an essential feature of any complex, advanced economic system. If you really want to get rid of banks, you should be advocating that we return to a hunting and gathering economy (unfortunately it would mean that most of us would starve to death).

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    1. David

      Hehehehe, well spoken like a true banker. Considering that the banking system invented Communism / Socialism as a means to establish absolute power and control over a population in order to force them into feeding them once they could no longer be fooled into doing so, and since pretty much everyone on here has figured this out by now, i don’t expect your going to convince too many otherwise.

      Why do we need banks, do they build anything, fix anything, feed anyone ? What do they do that entitles them to rape the population for 60 – 80 % of what they earn each and every month and year, in interest and taxes made necessary by their issuance and control of something that belongs to the people who are building things, fixing things, and feeding people ?

      Sounds an awful lot like communism / socialism to me, can anyone other than this banker tell the difference ? I certainly can’t.

      What we are pushing for is a free economy, and a truly free enterprise system where each and every individual in our society capable of contributing to its useful production and toward our collective benefit will have the opportunity to do so and to prosper from doing so as well, and in order to have this entails public control of that economy’s means of exchange. What you are defending is a system of servitude, where the economy exists simply and only in order to serve the interests of a few parasitic families, who have managed to suppress any hope of economic prosperity for the general population and are rapidly progressing toward a system where any small amount of prosperity which is permitted to any individual will be with their permission and not by right.

      At long last and especially as of the last few weeks, it seems that the general population is waking up and becoming aware of the fraud that has been perpetrated on them and the Banks and the politicians they have put into power are absolutely terrified and they should be. Since you are obviously a man of means who has made his fortune manipulating money instead of contributing toward the useful production and benefit of the American population, they will wipe you out, and leave you homeless, and penniless in the street, just as you would have done to them, and it will be you and only those like you who are starving, not they, which is what you justly deserve as well.

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    2. David

      Further to my last:


      During a visit to Britain in 1763, The Bank of England asked Benjamin Franklin how he would account for the newfound prosperity in the colonies. Franklin replied.

      “That is simple. In the colonies we issue our own money. It is called ‘Colonial Script’. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers…In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one.”

      In response, the Bank of England influenced the British Parliament to put a stop to this activity. Under the Currency Act of 1764, King George III decreed that the Colonists cease printing their own money. The colonial script in circulation was to be exchanged at a two-to-one ratio with notes drawn from the Bank of England. This caused widespread unemployment and economic depression in the colonies.

      “In one year, the conditions were so reversed that the era of prosperity ended, and a depression set in, to such an extent that the streets of the Colonies were filled with unemployed.” (Benjamin Franklin)


      This is an American Economy !

      Hopefully the Rothschild from the Bank of England will finally give up.

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    3. yes banks, no central bank

      The Other David. You are confused about what type of banking us “anti-banking” people oppose. We oppose the central bank. It is a government granted monopoly on the manipulation of currency. Assuming you believe in free trade, you should also believe in free trade in money. We do not wish to abolish money, or banking and “return to a hunting and gathering economy.” Banking does serve an essential role in the economy. What we want is to see a competition of currencies where the American people get to choose the best currency in the free market just like we can choose the best soda and the best car, and allow market forces to operate in determining the best currency. Free to choose their own currency, Americans would not choose inflationary currencies (read fiat). Free to choose their own banks, Americans would not choose ponzi banks (read fractional reserve banks). Clearly you do not understand what us “Paulian libertarians” truly believe, nor do you understand what money is, or how banking works. I recommend you read “What has Government Done to Our Money” by Rothbard with an open mind, and reconsider your misinformed attack on the Paulian Libertarians.

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    TEA Party today 29 may in The Hague The Netherlands,

    Libertian Party headed by Toine Manders since 1993 (once in elections 1994, but now out of contest), who will defend his theme “income tax is robbery”. US Cindy and Eric Schneider presiding.

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  10. Christine

    Devvy Kidd is a long-time truth teller and a constitutionalist. She sounded an alarm as a forerunner in disseminating info on the FED in her booklet titled “Why a Bankrupt America” years ago. Go to her website to do some research using honest info about the topic of taxes and others. Highly Recommended!

    Why an Income Tax is Not Necessary
    to Fund the U.S. Government


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  11. Christine

    There is no social security fund. The money is taken by a forced tax, not invested for our use as a retirement fund is or could be. It’s full of IOUs that were promised to be paid back, but the govt stole and steals the money via paychecks and many people who paid into will never see the benefits of it. The criminals have been in charge of this money, just like all things financial, the govt gets its money by …Grand Theft. and no one is making them pay it back to “we the people”. That’s why it is a defunct system, bankrupt like every other program they touch. You can expect the same with healthcare.


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    1. Christine

      There Is No Social Security Trust Fund:
      The Joke’s On You

      “For instance, in this year 2000 the government will take in social security taxes of 479 billion dollars taken directly from the paychecks of 95% of the working public. Benefits paid out to retirees will be 409 billion dollars. The Treasury Department will give the Social Security Administration paper IOUs for the 70 billion of excess social security taxes that were supposed to be saved for future retirement benefits. Worse yet, the Treasury will not subtract this 70 billion debt from the federal income surplus that is claimed. Because your social security money was stolen, there was no real federal surplus the last two years.”

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      1. Joan

        That is not how it works at all. It’s a ponzi scheme. It takes in far less than it pays out. The money it took in from the baby boomer generation was paid to the WWII generation. They paid one half of one percent into social security and nothing into Medicare. Many received 1,000-1,5000 a month for 25-25 years and they received right around a million dollars each in free health care. They paid maybe 2,000 into SS and received 200-300,000 out of it. That’s why it went broke.

        There are 75 million people on SS and SSD and SSI and Medicare. How can you charge just people who work 6 percent tax and pay over 75 million people 1,000-1,500 a month and give all of them free health care? The program takes in very, very little money compared to what it pays out. 41 people used to pay into it to give the World War II people free money and free health care. Now, here are only 4 people paying for one person. It takes a lot more than one person paying 6 percent into it to hand another person 1,500 a month and hand his wife who didn’t pay into it 1,500 a month. You need 40 people paying 6 percent in to give the 3,000 a month to one payee. And, Medicare only takes in one percent and pays 500,000-1 million per person for end of life care, pays for 200-300,000 surgeries, expensive tests, pays for all medical care, it doesn’t pay an insurance premium, it pays the actual medical costs. There is a tiny bit of money being paid into Medicare and it would cost over 45 TRILLION dollars to give the 75 million baby boomers free medical care from Medicare. It’s high, high, high cost welfare.

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      2. Joan

        If we want to fund the 75 million people now on social security and fund the 80 million baby boomers about to go onto it, and let’s say another 10 million more fraud people backdooring it by lying they are disabled, in order to fund 165 million people to get SS and Medicare, the population of this country would have to be 6 billion, 765 million people in order to fund it, to continue the ponzi scheme of 41 people paying into it to fund one person receiving it. We would have to let 6 billion, 445 million working age people into the country in order to fund it, and hope none of them backdoor it on disability nor get their children on it.

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    2. Joan

      Social Security pays 75 million people 1,2000-1,500 a month. There are millions more every year going onto disability, and another 75-80 million baby boomers retiring. That’s more than half the population on SS and Medicare. It needs over 110 trillion dollars just too fund giving the baby boomers what it has promised to pay them. If 479 billion a year was being paid in, take the 75-80 million baby boomers paying into it out, now there will be one-third as much being paid in, and it costs 135 trillion a year to pay out, where does the money come from? If people pay 10K into Medicare, after one year of medical care, who pays the money to Medicare to continue to give them free health care when people are living to be almost 100? The government has to come up with 45 trillion dollars to provide the free health care for each person for decades after they retire. It was never designed to be a retirement plan. It was set up by the progressives to pay one out of maybe 100 people who live beyond 65. Life expectancy was 62, the few who lived to be 65 were to be given 200 a month for a few years and health care back in the days when doctors made house calls for $25 and there were no major surgeries and no expensive tests and drugs. It was never set up to be able to pay trillions of dollars in free money and free health care to millions of people, let alone over 150 million people, which is where it’s at now. It was set up for everyone to contribute to be redistributed to the few who were poor and who outlived their life expectancy. It was set up as socialism, today everyone makes it up that it is their governmet pension or disability pension and that they paid for it. After one year, it’s welfare, after a few months of health care, it’s welfare, and, for the one generation who received it, the WWII generation, it was all welfare, mostly to rich people. It crashed and burned in one generation because the politicians kept raising the benefits to get votes and because science and medicine advanced and advanced to the point of Medicare going from costing a few thousand dollars for one person to close to or over a milion dollars for one person. They have to privatize Medicare. It is beyond unsustainable, and they are now talking about means testing SS. They have to. The politicians should have stopped all of this welfare for rich people and paying masses of people free money 30 years ago. They let it go into trillions of debt, just kept paying out money to get votes until the generation who funded it wants it. It was such a bad idea, it tanked in one generation.

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  12. David Brown

    Where in the U.S. constitution does it say that roads have to be publicly owned? And of course utility companies have to “interact” with one another. Does each utility company have its own set of transmission wires – I don’t think so. One or two private companies would have to have a near monopoly of road ownership in any particular area but that is no different than it is with any other utility service.

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    1. fred the protectionist

      It says it here:

      “The Congress shall have power -

      3. To regulate commerce with foreign nations, and among the several States, and with the Indian tribes; but neither this, nor any other clause contained in the Constitution, shall ever be construed to delegate the power to Congress to appropriate money for any internal improvement intended to facilitate commerce; …”

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  13. David Brown

    I am surprised that my post criticizing public ownership of roads would receive seven thumbs down. I suspect that many of the readers (and posters) on this blog are not true libertarians. After all why should roadways be publicly owned but other “utilities” privately owned? Or perhaps the posters here are actually in favour of the nationalization of utility companies.

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    1. Jonathan

      The ability to travel is a right guarenteed by the Constitution. And not a privalege granted by a private for profit company who buys a roadway from the public domain.

      Ron Paul 2012 !!

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    2. Theresa Romano

      I think maybe road space is limited and there would be all sorts of turf wars if private ownership took place. With utility companies they don’t have to interact with each other. My gas company isn’t involved in any way with my neighbor’s gas company. But if my street were owned by Joe Shmoe and Janet Shmie owned the neighboring street then wouldn’t they have to work together to figure out what to do where the roads intersect? It could get messy.

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  14. David Brown

    I trust that Ron Paul as a true libertarian is in favour of abolishing all forms of social security and social assistance including medicare for the elderly. Income will still flow for awhile to seniors as obviously there needs to be some sort of process to reimburse the deductions that have previously been (forcibly) made from people’s pay cheques. Eventually, however, all government income support would end.

    The ultimate objective would be to abolish the so-called social safety net. It is true that some people who fall off the economic cliff might hit the ground rather hard but so be it. A certain amount of “cushioning” could still be provided by private charity comparable to the almhouses of yesteryears.

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    1. Joan

      David, most of the World War II people I have known were very wealthy and they received tons of free money from SS and millions each over a period of decades in free health care through Medicare. The politicians used the 80 million baby boomers, taxed them to hand their money to a lot of very wealthy WWII people to gain their votes. And, the politicians knew they would cut it off when the baby boomers retired. They had no intention of paying one more generation big benefits like that because they knew there was no large generations behind them to fund those programs any longer. All the politicians care about is getting reelected and in 20-30 years, the problems they let go on become someone else’s problem.

      The government could pay people on a tiered system, millionaires get three years of payments, that’s over three times what they pay into it, people who make 500,000 retired, give them four years of it and cut it, people who make over 250,000 retired, give them five years and cut it. People pay so little into it that after the first year, they have received what they paid in. The government doesn’t base it on need, so millions and millions of wealthy people who own lots of properties, have huge rental incomes, or have millions in the bank and in stocks and bonds, lots of them have huge pensions, some have government pensions that pay 100,000 a year, they all get 1,500 for themselves and another 1,500 for their spouses who never worked. It’s such a massive welfare program that is unevenly distributed that something has to change. An indigent window gets 1,500 a month while the retired man with a huge pension gets 3,000 a month because his wife who didn’t workgets paid too. The window who has no pension and no spouse supporting her should be the person getting 3,000, not the wealthy couple. Sean Hannity said two weeks ago that the government is going to means test it now, and give it according to who is poor. Many groups want to privatize Medicare too, it’s unsustainable to pay 5,000 into it and receive health care for a person and their spouse for 25-35 years after they retire. They are talking about giving out a voucher for 12,000 a year to people to buy their own health insurance instead of the government paying all of their medical bills. People would have to pay part of their own premiums and wealthy people would lose some of their free money. But, no one wants to do it. People give lip service to smaller government and lower taxes, but if the government asked rich people to let the SS money go to the poor, they protest and scream bloody murder because they had planned on expensive trips to Europe several times a year on that extra free money, they don’t care about a poor widow. People want all the free stuff they can get their hands on. They don’t want to have to spend one dime of a 100K pension on buying health insurance. It’s not only young people who are on welfare who are addicted to socialism, all of the old folks receiving SS and Medicare are beyond addicted to it.

      The Tea Party people are old people who are on those programs and they were protesting Obama taking 500 billion out of Medicare. He was actually cutting socialism and they were protesting to keep it, while calling him an evil socialist. They aren’t educated and listen to Glenn Beck and they are beyond addicted to socialism and lie that it’s “their” money. After one year, it’s welfare, and they all know paying 5K into Medicare certainly doesn’t entitle anyone to a million dollars in government paid health care. As long as the government hands out free money, everyone will say they are entitled to it. The goverment should have privatized Medicare and gone onto a tiered payout system for SS 30 years ago, and they know it. All they cared about was raising the taxes every few years on the baby boomers and handing that tax money to the WWII generation to get votes. Now, it’s the baby boomers problem, the next generations’ problem, the new politicians’ problem.

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      1. Heather

        Yeah, so I am reading your comment as, “Give to each according to their need, regardless of what they’ve done to pay into it”. Well, that is a load of crap as far as I’m concerned. If they really want to fix it, they could just give everyone what they’ve paid into it back, maybe that would make sense. Luckily I don’t have to pay into it right now (my district has it’s own approved mandatory retirement crap), and the money I pay in goes into my “account” for when I retire, quit the district, or simply ask for a refund or all my payments (which would be if I said I was done teaching/working as a paraprofessional in the state).
        I also could care less if people who make a lot of retirement money and have a savings account or two also get social security – they have paid into it after all, and probably a lot since they make so much money. The tax is 6.8% ( I believe) and it’s matched by the employer, so it adds up to quite a bit of money. people who make less, and subsequently paid less, should get less. But, like you said, there are people who have never worked (and sometimes even non-citizens, in the form of a disabled American born child, or whatever) that are receiving benefits, which is obviously wrong.
        I pretty much would be thrilled if paying into Social Security was no longer mandatory, along with any other mandated retirement savings plans, or if it was abolished all together. Figure out what everyone has paid in and cut them a check or something (god knows the gov’t hasn’t kept it all in there, so we’d probably all end up with a percentage of what we were owed, but at least it’s something) – we did work for it after all.
        This is my opinion, but I know I’m not alone.

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        1. Joan

          Heather, it was set up for one out of about a hundred people to receive it for a short period of time, it was never set up as a 25-35 year pension. It was set up for the few poor people who lived past 65. Why should a woman who never paid into it get it just because her husband worked? That makes no sense, that’s free money to her. If a woman works and pays into it and her husband didn’t, the husband can’t draw it because his wife paid into it. The Cato Institute talks about how unfair that aspect of it is. There’s a cap on the tax, it cuts off at about 160K, so people who make a lot don’t pay in a lot more money. Most people pay between 30K and 50K into it, so in one year and man and his wife drawing down 1,500 each, get back 36K. After a few years, it’s welfare. If a person is getting 100K in a government pension the taxpayers are paying for they are a big drain on the taxpayers to pull it from both sides, government pension and Social Security. That is what New Jersey and California just went bankrupt over. They can’t pay those big taxpayer funded government pensions the unions have promised. Getting SS for 5 years, five times what a person paid in when they are rich should darn well be enough. It would cost 45 trillion dollars to give out that money to one more generation. That’s the government’s estimate. That is because people pay 30-50K in and draw out 700K or more. It’s not sustainable. When you’re talking trillions, and 45 trilion at that, SS is the biggest welfare program in this country and why should wealthy people get 45 trillion in welfare? Same with Medicare. It would cost over 55 trillion to hand out all of the free medical care, that’s beyond off the charts welfare, there’s nothing wrong with only providing that for a widow or a person who worked in a low wage job and doesn’t have a pension. The Dems and the Repubs are working on on doing these things right now. They just set up means testing for SS, as well they have to. There was no 110 trilion paid into those programs, and no government is borrowing 110 trillion to hand money to wealthy old people. If people really want to end entitlements and welfare and have a balanced budget and get rid of our debt, they have to be willing to give up things to do it, take five times what you paid in and let it go. Rich people want double payments for 25-35 years, they are lying they don’t want socialism and that they want less debt. It’s always do away with all other entitlements, but we paid a bit into these two entitlements, so we have a hook into it, we are entitled. It’s all a game people play to get free money and free health care if they can do so.

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  15. Charles

    You stated you do not pay or that you receive all of your income tax and FICA you pay in yearly.
    Than I would have to assume you know of Pollock v. Farmers loan & trust Co 158 U.S. 601 (1895)
    “Taxes on realestate being indisuputably direct taxes, taxes on rents or income of realestate are equally direct taxes.” “Taxes on personal property, or on the income of personal property, are likewise direct taxes.”” the tax imposed by sections 27 to 37, inclusive, of the act of 1894, so far as it falls on income of realestate, and of personal property, being a direct tax, within the meaning of the constitution, and therefore unconstitutional and void, because not apportioned according to representation, all those sections, constituting one entire scheme of taxation, are necessarily invalid.

    The only direct taxes embraced within the Constitution are capitation taxes and taxes on land.

    And the 16th Amendment which I know Federal court states as being rattified. I would like to state that they the Federal Courts are wrong in their assumption. As there is proof it was not legally rattified by 3/4 of the states.

    Also there was an agreement with the people and the Federal Government to pay an income tax for 2 years to help with the war effort of WWII, this was repealed after the two years but the Feds neglected to announce this to the people and continued on their corrupt marry way of defrauding the people.

    I am hoping and looking forward to a time when we will have a non puppet in office that will be for the people and the rights of the people. Most of our elected officials in office are for lining of their pockets. 62 of our Senators just proved that by voting down a bill to Audit the Federal Reserve. I also know that I can vote and will, the only differance is I am not paid to vote.

    We have total corruption through out, even in our Courts. If you have ever noticed the Flag in our courts or any Government building, it will have the gold or yellow fringe around it. That my friend is an American Military Flag, where thay can follow military justice and void your constitutional rights and they do. Yes the Judge and others swear an Oath of office to uphold the Constitution. If they truely believed in their OATH of office the military flag would not be hanging. It is not an indoor flag as they would have you believe, well for the Military it is. The flag is indicating pretty much they are on foriegn ground or a territory of UNITED STATES. And it is unconstituional to have a state within a state in America.

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    1. steve

      Yes, “Pollock v. Farmers loan & trust” is familiar to me. Congress passed a revenue act that triggered the lawsuit. Part of the act tried to say that the income tax would now apply to profits/incomes derived from private sector investments in federal corporations(created by congressional act or wholly owned by the fed. gov.) and or federal instrumentalities(railroads) and the Supreme Court properly, as you point out, ruled the offending sections void. The voided sections were attempting to place a direct tax on private property without constitutionally required apportionment. Constitutionally, congress can place an excise/income tax on compensation derived from federal privilege and did so in the 1862 revenue act.

      The only way for congress to get around the Pollock v. Farmers loan & trust supreme court decision was to amend the United States Constitution to allow for the unapportioned taxing of private sector profits derived from federal privilege. Enter the 16th amendment. Now Congress can pass(and did pass) a revenue act that specified taxing unapportioned private sector profits derived from federal privilege/ activity such as interest received from National Banks or any other interest received or profitable stock sale derived from wholly owned federal corportations or federal instrumentalities.
      If the 16th amendment were to be repealed, Congress could no longer tax unapportioned private sector profits derived from federal privilege/ activity such as interest received from National Banks or any other interest received or profitable stock sale derived from wholly owned federal corportations or federal instrumentalities. That’s it. Period. We have all been lead to believe that the 16th allows for the taxing of “all that comes in”. But Supreme Court decisions show otherwise.

      So the big question is, “If they can’t tax “all that comes” in, and I have no federal privilege/activity then why do I pay taxes?”

      The quick answer is because of specialized definitions. When IRS publications and forms talk about employer, employee, wages, trade or business, and employment most people apply common definitions to these terms but these terms by way of statute have had their common-meaning-definitions stripped away and have had very specific definitions replace the common ones. This practice is legal and is done by all levels of government. The goal of statutory definition is to provide legal clarity which is a good thing. Unfortunately, congress chose to place the necessary definitions to understand title 26 deep in the bowels of the title. When most people start a job, they are asked to fill out a W-4 which allows for legal withholding from monies paid for federal service(federal job). Typically a payer still withholds money even though you are not being paid for federal service. Your payer sends these withholding’s quarter to the federal treasury in bulk (no worker names are written of form 941 or form 943).
      Come January you get a form W-2 (the social security administration also gets a copy but the IRS doesn’t) which is simply an information return. It is up to you, the payee to verify the information on the W-2 before transferring the information to the form 1040. It is good to know the statutory definitions of “wages”(sections 3401 and 3121)before simply transferring data from one form to another. Form 4852 can be used to correct erroneous information from form W-2, (or form 1099r) or you can get a corrected w-2 from your payer. Form 4852 does require a signature declaring the statement is true, correct, and complete to the best of my knowledge and belief where as the W-2 does not. Finish filling out your 1040 and sign declaring your knowledge and belief that all statements and schedules are true correct and complete.
      In a nut shell if you don’t correct erroneous information(w-2′s 1099′s) showing federal activity, the presumption is that you were engaged in activity that triggers income tax liability.

      Congress imposed the victory tax on statutorily defined(SD)wages which didn’t include private sector pay.
      There shall be levied, collected, and paid for each taxable year beginning after December 31, 1942, a victory tax of 5 per centum upon the victory tax net income of every individual (other than a nonresident alien subject to the tax imposed by section 211 (a)).
      Also during the war Congress hired Walt Disney and Irving Berlin(probably others)to promote paying income tax to fund WWII not because it was the law but because it would be patriotic. People not liable for the income tax, started paying it to be patriotic. I would agree that once the war ended, the federal government did not tell people to stop donating their money to the treasury so they kept donating. The Internal Revenue Code of 1954 organized the existing internal revenue statutes into its current confusing form. At a minimum, one must read subtitle C and subtitle F section 7701 for clarity before reading subtitle A. There is nothing illegal or unconstitutional about organizing the title in such fashion but it is one factor that prevents title 26 from becoming positive law.

      I believe as more Americans learn what the rule of law actually means and how it is applied, they will support candidates for public office that actually understand rule of law.

      I say screw audit the fed, lets repeal the federal reserve act.

      It is ludicrous to think that a fringed or un-fringed US flag could control court jurisdiction. Title 4 contains all US flag legalities. The title does not address fringe on flags. It neither promotes or prevents fringe from being placed on a flag. Eisenhower’s ‘Executive Order 10834–The flag of the United States’ also does not promote or prevent fringe. “[M]ilitary regulations[not US law] DO prescribe the use of a yellow fringe for the National Flag of the U.S. In the Army, the National Flag with fringe added is termed the *National Color*. This National Color is intended to be displayed indoors or carried on parade, usually with other military colors (also fringed). The fringe, so used, is a military tradition derived from British practice.”

      What are you specifically referencing when you say “And it is unconstituional to have a state within a state in America.”?

      Nice to see Rand Paul won the primary in KY.

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  16. Charles

    There are 13 Supreme court cases stating what wage is. And it is a constitutional right to own property and your first and foremost property is your right to labor, without your labor there is no other property. So do tell me how you can put a direct tax on a constitutional right?
    And within the constitutional amendment it is congress who shall have the authority to levy and collect taxes. Tell me where it states anywhere in our constitution or any amendment that congress has given this authority to the IRS? Because they cannot.

    What Jurisdiction does the IRS have over anyone of the 50 states? Anyone of the 50 states is not a territory of the United States, like the District of Columbia, Guam, Puerto Rico, Somoan Island, or U.S. Virgin Islands. This is where the federal governement and their IRS has Jurisdictional claim over the territories.
    Remember the Government is the peoples representitive, they work for us. It is not in the constitution for the government to rule us. This is not a monarchy.
    A monarchy is what our fore fathers faught and died against to gain our freedom and independence.
    Although in the last 100 years our representitives have been turning our government into nothing more than a Corporate Governement for their own profits and gains which by the way is income. If it is not anything more than the federal government being a corporation than why have they given control of our money to a private banking firm called the Federal Reserve.
    Their are very few representitives that are courages enough to stand up for the people and our constitutional rights, and have the honor and fortitude to push forward in their belief of the Constitution of the united States of America. I have found a few and I know of one who I hope will run in 2012. Ron Paul would have my vote all the way.

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    1. steve

      Charles, direct taxes can only be by apportionment derived from the census. The
      “income tax” is constitutionally legal because it is an excise or indirect tax. Lincoln and his congress passed this excise tax on federal privilege back in 1862 along with other excise taxes. Sections 86, 90 and 93 were never repealed and these for the starting point for all subsequent income tax law.

      The 16th amendment did create confusion for some folks, but not the Supreme court. It recognized that the 16th did not create a new type of taxation, but instead closed a loop hole that allowed private sector people investing in federal entities to not be taxed on federal privilege. The Supreme Court ruled that National banks are instruments of the federal government back in the 1890′s. Up until the 16th passed, any non-federal interest or dividends earn from investing in National banks were not liable to the income tax, after the passage of the 16th amendment all National bank (federal) interest or dividends were liable for the “income tax”. At the time interest or dividends derived from union state banks were not subject to the federal “income tax”.
      As a side note, title 12, banks and banking, which contains the federal reserve act required all non national banks to become national banks as a federal reserve membership requirement. So back in 1913 as a non national bank, if you wanted to play with the big money banks, you had to subject your bank to federal law by becoming a national bank.

      With regards to the income tax, the IRC and IRS only have jurisdiction over people engaged in federal activity. It has nothing to do with a SS number or where you live or what you eat, liable only comes from federal activity.
      The secretary of Treasury back in WWII needed to raise more tax dollars to fight to war. In 1939 (way after 1913)the treasury was collecting income tax from about 4% of the population because only 4% of people were engaged in federal activity. In 1942 the feds hired Walt Disney, Irving Berlin and others to promote paying federal income tax as a private worker. The plan worked, voluntary payment of income tax shot up at 15% per year. The war ended but people kept volunteering income tax payments. The congress never told the people to stop donating money. We still do it today only now congress tells us if we don’t send money, we may be subject to penalties, fine and or jail.

      The truth about federal income taxation is that it only applies to federal activity(postal worker, fbi agent, congress person, irs agent, USDA soil tester and so on)
      I am not a federal worker. I receive a return of all withholdings, income tax and fica when I file a form 1040. The irs doesn’t put up a fight, they know that I know the law so they follow the law.

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  17. Larry L. Stuler

    The income tax is not what you believe it to be. The Supreme Court ruled in several cases (Brushaber v. Union Pacific R.R. Co., 240 U.S. 1 (1916), Stanton v. Baltic Mining, 240 US 103 (1916), and Peck & Co. v. Lowe, 247 US 165 (1918)) concerning the income tax. Two main points were brought forward – 1) that the government always had the power to tax income, and 2) that the 16th Amendment conferred no new taxing powers to the federal government.
    Since no new taxing power was conferred to the federal government, then the income being taxed must already have been within the federal government’s jurisdiction. The only jurisdiction that the federal government has concerning commerce (generating income is a commercial activity) is granted by the Constitution – foreign commerce, interstate commerce, and trade with the Indians. So whatever income is being taxed by the 16th Amendment must be within one of those constitutionally granted jurisdictions.
    Each of the three commerce jurisdictions is cited separately under title 28, “Judiciary and Judicial Procedure”, chapter 85, “District Courts; jurisdiction”. The cite to section 1336, “Surface Board Transportation orders”, which was renamed from “Interstate Commerce Commission’s orders” in 1995, is the interstate commerce part of the commerce clause. The cite to section 1362, “Indian tribes”, is obviously the trade with the Indians part of the commerce clause. And the cite to section 1340, “Internal revenue; customs duties” is the foreign commerce part of the commerce clause.
    How then does the income tax apply to a sovereign American? It doesn’t. But when a sovereign American applies for a S.S. #, that person has now become a federal employee. After all, only federal employees are liable for federal employment taxes!
    You’ve heard the name of the federal employee a million times – the “taxpayer”. A “taxpayer” is defined at 26 C.F.R. 2.1-1(a)(5) as a member of the Merchant Marine. At 26 C.F.R. 2.1-1(b) it states that this is the definition of the term used throughout the Internal Revenue Code and the regulations for all calculations of taxes.
    Within the Internal Revenue Code all “U.S. residents” are deemed to be “U.S. shareholders”. It is here that the income attributed to the “U.S. shareholder” includes an undistributed dividend that confers the foreign earnings needed to be liable for the income tax.
    To read more on the Social Security Scam see or and find out why Americans are losing their freedoms.

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    1. wesley

      Very interesting stuff; look into it.

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  18. Charles

    The 16th Amendment was never ratified legally. Study and will find this to be true.

    Also on a note income is derived from profit or gain. A wage is not an income, it is compensation for labor, an agreement between an employer and employee set amount of work for set amount, there is no profit thus no gain so therefore is no income. And the income tax you have been paying over the years is voluntary. Don’t just rush in and stop paying it though you will have to unvolunteer yourself.

    Ron Paul is type of leader we need. We have been coerced and lied to by the government and given to many of our constitutional rights away unknowingly and unintelligently.

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    1. steve

      The federal courts consider the 16th amendment ratified. I have seen no evidence that indicates a change in ratification.
      But do you really think our grandparents were all morons and allowed without a fight, an amendment to pass that would allow the federal government unlimited ability to tax moneys earned by all workers in the USA? That our grandparents would not en mass call on state house and senate members to re-soundly vote NO on any amendment that would give the feds a blank check taxing power ? That the states themselves would not vote for a power so great to the feds?
      We are morons if we think our grandparents were that stupid.
      So what is the amendment all about?
      The 16th amendment closes a federal excise tax loophole. Federal Revenue Acts from 1862 forward create an excise tax on federal privilege/activity. If you worked for the feds (privilege/activity), they would place an excise tax (income tax) on your pay. The feds tried to apply this tax to private property invested in federal corporations but the Supreme Court said in essence, the feds could only tax this private property if it was apportioned by census as required by the constitution. So to tax the private property of say one hundred investors the tax would have to be apportioned by census, the court declared this tax unreasonable and told congress it was void.
      The 16th amendment was the solution. After its passing congress could pass revenue acts that would not be struck down by the Supreme Court which allowed for the excise tax to be placed on all moneys derived from federal privilege/activity regardless of apportionment.

      Charles you say “A wage is not an income, …”. The Internal Revenue Code (IRC) legally includes wages as income. So by the IRC definition (which is the one that counts when it comes to income taxes) has wages as income. If the IRC can give legal definitions (and they can) to words or terms, what is the definition of “wages”?
      Section 3401, (a) Wages
      For purposes of this chapter, the term “wages” means all remuneration (other than fees paid to a public official) for services performed by an employee for his employer, including the cash value of all remuneration (including benefits) paid in any medium other than cash; except that such term shall not include remuneration paid—

      Does employee have a special definition?
      Section 3401, (c) Employee
      For purposes of this chapter, the term “employee” includes an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

      How bout “United States” and “State”?
      Section 7701
      (9) United States
      The term “United States” when used in a geographical sense includes only the States and the District of Columbia.
      (10) State
      The term “State” shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title.

      But what about “includes and including”? Aren’t the feds just giving examples?
      7701(c) Includes and including
      The terms “includes” and “including” when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined.

      Title 26 IRC (as well as all titles) has lots of specialized definitions for common place words. Before anyone, congressmen included, can properly evaluate and analyze the Internal Revenue Code you must first learn the scores of specialized definitions buried (I mean placed) through out the code and apply them to the written law (title 26). Once you do this it becomes very obvious what makes one liable for the excise tax on “income”.

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      1. Christine

        In the definitions you note, I don’t see where the tax is applied to a regular employees of a business….rather, it is applied to govt (state or federal) employees only.

        What is the definition of a corporate official?

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      2. steve

        Christine, if you go to Cornell law uscodes( and go to title 26 you can learn a lot more than what I am posting. You reference “regular employee” and I assume you mean a private sector worker, but the IRC and the IRS only recognize statutory definitions of terms. So a ” regular employee” would, in IRS eyes, be defined by section 3401 or 7701(a)(20) or 3121. In all 3 cases service is the key and the service is defined in the classification act of 1923, which is “an act to provide for the classification of civilian positions within the District of Columbia and in the field services”. No where in the code is it discussed how to tax the income of private sector workers because private sector workers are out of view of the income tax.

        The IRC jurisdiction only includes territories, areas claimed by the constitution, federal states (US property, post offices, federal buildings, leased office space and so on) but not union states. Congress has cleverly written the IRC to make it appear as if IRC jurisdiction includes union states, but on close examination it doesn’t.

        You ask “What is the definition of a corporate official?” First what is a corporation? Corporations are entities created in one of the 50 union states or the federal state(district of Columbia) using applicable law. Of course foreign countries have their own laws relating to entity creation but I will limit this discussion to union states and the federal state. The 50 union states and one federal state are sovereign to each other. The constitution gives the federal state control over certain things which means the union states have no control over these things such as the navy, coin money (see Article one section eight of the US constitution for complete list). Union state sovereignty and federal state sovereignty stand toe to toe except for the items enumerated in the US constitution.
        The corporation is “domestic” to the state(union or federal) in which it was created and foreign to all other states(union or federal). The IRC only has income taxing power over “domestic” federal corporations or wholly owned corporations such as General Motors. The government did not randomly select 60% of stock ownership they purchased just enough to make GM truly under federal (domestic) corporation control. Some corporations are domestic because they are created by Congressional Act. Others become domestic when declared a federal instrumentality such as national banks in the late 1890′s.
        The IRC doesn’t have a statutory definition of a “corporate official” but any thing in the law relating to a corporation can only mean a domestic federal corporation.

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  19. Penny

    [How] Tariffs Will Make the Global Economic Collapse Much Worse: Part 1

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  20. C. Porter

    But there are other ways to raise revenue besides an income tax. Although I now support a comsumption tax and am not a libertarian, unfortunately, what about using the fees from national parks? Or how about the purchase of Treasury Bonds and other Securities? Or perhaps even going back to seriously using money from land sales? Or more tariffs? These are just some examples of what can be accomplished. Thank you.

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  21. David Brown

    One of the most egregious forms of socialism is free roads. Yes there area few (very few) toll roads in America, most roads are constructed and maintained by the state. The road user – unlike the user of other utilities – gets them for free. Thusly someone like myself who walks to work ends up paying for the 28 miles of road a cousin requires to get to work.

    Roads should be privatized and operated like any other privately owned utility. The state can recuperate the billions of dollars that they spent building the roads in the first place. There will no doubt be stiff tolls required to use major highways but once again the hidden hand will be effecting a social good. Currently highways are congested because of all the “its free” users. It is like the pushing and shoving that always takes place when something is given away for free. The price system will remove much of the traffic as only the people who really need to use the facility will pay for it. Less traffic, less pollution, less use of gasoline, less emissions … the list goes on.

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    1. fred the protectionist

      David Brown is a true-blue Libertarian, read his comments well. This is the core ideology of Libertarianism; regardless of whether you claim to be a little l Libertarian or a capital L Libertarian, all Libertarian ideology is derived from David Browni’ism.

      Ironically this type of economic ideology is also Confederate, Dixie, mid 19th century Southern economic ideology; the economics of a slave based economy where there is no middle class. The Confederate/Southerners were even hypocrites, they only enslaved half the population; the Libertarians are true-blue believers in the slave based economy where everyone has an equal opportunity to become a slave. Black, white, brown, slant eyed, it doesn’t matter to the Libertarian, there is no racism for the Libertarians.

      Maybe I should have played devil’s advocate.

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    2. chris

      I thought the roads were paid for by the tax paid on gas.

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    3. SS

      Two birds with one stone
      WTG Chris

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  22. Chuck

    Have you seen how far off these people are? Some of these guys completely and blindly support Obama, He can do no wrong.. If you have a moment, maybe add some fuel to their fire, the conversation is primarily “O can do no wrong”, and “he is saving the world” type conversation.. makes me sick

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    1. Christine

      There are a lot of people who still do not see the corruption. Amazing it’s it? Just amazing. We are in the worst shape ever and they are still in denial. They have short-sighted, narrow vision and buy into the propaganda, are not looking at the incrementalism as it happens. They don’t have the ability to connect the dots. Just check out the “global warming” topic on this website sometime. It’s absolutely scary what some people believe is truth. There you will find the actual evidence of the dumbing down you hear about. It’s for real.

      What will it take for them to see the truth with foresight, not hindsight?

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    2. wesley

      The teabaggers are good people,
      but the tea-party is weak: the media grabbed it like it was a photo of Dick Cheny in drag.

      if Fox News, fair and balanced, wants to let the people know you exist then you’re not speaking clearly enough.

      “This is socialism; this is communism.” Well, yes, it is; but that not going to cut it anymore is it?

      – DO NOT RUN
      – insist that they listen to you for a respectable amount of time (say, half an hour) and that the interview only be shown in full
      – allowing for their insistance on molesting your ideology for a news-bite, simply look into the camera and recommend to the people: “Just follow the money trail.”

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  23. Brad

    Today is April 15th…tax day 2010. I despise this day with every fiber of my being.

    I am a long time liberal, but after today I will support Ron Paul to the best of my ability. I will do this with the hope that future generations will no longer be forced submit their hard-won earnings to a self-serving, out of control government on April 15th.

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  24. Dfens

    This is Ron Paul at his best. The 16th amendment is at the very heart of what has made the federal government the out-of-control monster it has become. Kill the beast at the root of its power, which is its money supply. I like Ron Paul’s position on the 16th amendment even more than I like the Tea Party’s position in their “Contract from America” where they call for a flat tax. I say NO to the flat tax, NO to the so called “fair tax”. Let the federal government live within its constitutional confines and levy no tax except those originally provided for in that document such as tariffs.

    Our current tax system is unconstitutional even with the 16th amendment in place. How do you invent the IRS with all its databases and hundreds of thousdands of employees out of this statement?

    Amendment 16 – Status of Income Tax Clarified.
    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.

    The answer is, you don’t. There is no constitutional basis for the IRS and the constitutional basis for the federal government levying a direct tax on the income of state citizens such as you and I is tenuous at best. Still, in the interest of peaceful change, let’s drive a stake through the heart of the beast we created and repeal the 16th amendment. Good call, Ron Paul!

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  25. Anthony Estrada

    As some one who supports the Tea Party Movement Congressman Paul’s son for the US Senate in Kentucky I feel it was wrong of the movement to go after a someone who represents the spirit of the movement and who along with Sen McCain is against government waste and Obama’s Anti-American agnda.

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  26. JLM

    I love how everyone is crying about taxes and does nothing about it. Your still paying them. I know they put you jail for that…shucks. So they give free room and board for not paying taxes…go figure. Also I love watching all these old people complain about taxes as they collect their wellfare *cough* I meen social security checks and their socialized medicine *cough* I mean Medicare.

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    1. AzEditor

      Where is the ‘option’ to NOT contribute to Social Security or Medicare taxes?

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      1. SCP

        Where, specifically, are the laws or statutes that determine who is required to pay Social Security or Medicare taxes? What title and section has the relevant statutes for determining if one is or is not liable for Social Security taxes or Medicare taxes? It is not an option to pay Social Security taxes or Medicare taxes, the law clearly defines who IS liable. If you are not liable but your payer withholds these federal excise taxes call Income, Social Security or Medicare taxes simple use the appropriate forms supplied by the IRS to correct the record.

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      2. wesley

        as a good starting point for your question i recommend “Cracking the code: the fasinating truth about taxation in america” by Peter Eric Hendrickson. It’s rather expensive for a 230 page paperback,, keep in mind that this guy spent a decade swamped in massive encyclopia-sized “tax-codes” and law dictionarys to undue the legal web. It’s not easy to read until you get the hang of it, but it is written for normal people.

        I say ‘starting point’ because you may start to wonder what other serpent-tounged legalities you might be better off not consenting to.

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  27. longshotlouie

    The Internal Revenue Service (IRS) intends to purchase sixty Remington Model 870 Police RAMAC #24587 12 gauge pump-action shotguns for the Criminal Investigation Division. The Remington parkerized shotguns, with fourteen inch barrel, modified choke, Wilson Combat Ghost Ring rear sight and XS4 Contour Bead front sight, Knoxx Reduced Recoil Adjustable Stock, and Speedfeed ribbed black forend, ………..

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  28. Tanabe Nation - Page 4062 - Nissan 350Z Motoring Forums

    [...] God I know the feeling. On the bright side though, tax season is near. Bright side? Taxes | Ron Paul .com __________________ "In the beginning of a change, the Patriot is a scarce man, brave, hated [...]

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    1. James

      How can the Fed give a tax refund to those who paid no taxes? Not how, why? Why does the Fed give refunds to those who pay no taxes? Defacto bribes for votes? Repeal, amend the 24th Amendment ratified 1/23/64. It was meant to eliminate only the poll tax. Dimocrats added “or any other tax”. Who was the President at that time? Hmmm. Did we see THE NEW DEAL. And now with Barry O, NEW DEAL II. Please Dims, bring back JFK.

      Just edit,eliminate three words at the end of Amendment XXIV,Section 1. “or other tax.” 99.9% of what Congress does involves spending your tax $$ and fiat, FED printed $$. Congress’ actions/ intentions have changed quite a bit since 1789 and again, fundamentally, since 1913, when they were given a blank checkbook. TAX & SPEND. TAX & SPEND. Is the mantra now “How can I get re-elected?”

      How about “If you don’t ante up, you don’t get dealt any cards.” Today,those who pay no taxes get as much say so in how it is spent, through representation, as those who do. That is of course if you don’t have your own lobbyist.


      Congress has the power to edit the 24th Amendment. What do you think? Too radical? Please check out Check out he World’s Smallest Political Quiz.

      RON PAUL 2012. JB.

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  29. larry

    Comments Please concerning:
    Have you searched Income tax law for “Excluded income”?
    31 Questions and Answers about the Internal Revenue Service Paul Andrew Mitchell, B.A., M.S.


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  30. Steve O'Connor

    Our founding fathers and the old Republican Party would turn over in their graves to see Ron Paul ignore their wisdom on the tariff:

    “We were suffering from the restrictions of foreign nations, who had shackled our commerce, while we were unable to retaliate: and all now agreed that it would be advantageous to the union to enlarge the powers of Congress: that they should be enabled in the amplest manner to regulate commerce, and to lay and collect duties on the imports throughout the United States.”

    “The Address and Reasons of Dissent of the Minority of the Convention of Pennsylvania to their Constituents”
    Samuel Bryan
    December 18, 1787

    In the debate on the first tariff bill in 1789, Fisher Ames, one of the ablest men in that Congress, said :

    ” I conceive, sir, that the present Constitution was dictated by commercial necessity more than by any other cause. The want of an efficient government to secure the manufacturing interest, and to advance our commerce, was long seen by men of judgment and pointed out by patriots solicitous to promote our general welfare.”

    Daniel Webster, historically known, as “the Great Expounder of the Constitution,” in a speech at Buffalo, June, 1833, declared : ” The protection of American labor against the injurious competition of foreign labor, so far at least as respects general handicraft productions, is known historically to have been one end designed to be obtained by establishing the Constitution.”

    Years later he repeated this idea, but much clearer and stronger in a speech at Albany, in August, 1844, when he said :

    ” In Colonial times, and during the time of the Convention, the idea was held up, that domestic industry could not prosper, manufactures and the mechanic arts could not advance, the condition of the common country could not be carried up to any considerable elevation, unless there should be one government to lay one rate of duty upon imports throughout the Union ; regard to be had, in laying this duty, to the protection of American labor and industry.

    ” I defy the man in any degree conversant with the history, in any degree acquainted with the annals of this country from 1787 to 1789, when the Constitution was adopted, to say that protection of American labor and industry, was not a leading, I might almost say, the leading motive, South as well as North, for the formation of the new government. Without that provision in the Constitution, it never could have been adopted.”

    GEORGE WASHINGTON, in his first annual message, speaking of the nation as ” a free people,” said :

    “Their safety and interest require that they promote such manufactures as tend to render them independent of others for essentials, particularly military supplies.”

    In his seventh annual message he shows that ‘ our agriculture, commerce and manufactures prosper beyond example (under the tariff of 1789). Every part of the Union displays indications of rapid and various improvement, and with burdens so light as scarcely to be perceived. Is it too much to say that our country exhibits a spectacle of national happiness never surpassed, if ever before equalled.

    In his eighth and last annual message Washington said : “Congress has repeatedly and not without success, directed their attention to the encouragement of manufactures. The object is of too much consequence not to insure a continuance of their efforts in every way which shall appear eligible.”

    JOHN ADAMS, our second President, in his last annual message referred to our economical system, and congratulated the country upon the great prosperity then existing, and added: ” I observe, with much satisfaction, that the product of the revenue during the present year has been more considerable than during any former period.

    ” This result affords conclusive evidence of the great resources of the country, and of the wisdom and efficiency of the measures which have been adopted by Congress, for the protection of commerce and preservation of the public credit.”

    THOMAS JEFFERSON, our third President, often referred to as the Founder of the Democratic Party, in his second annual message, in enumerating the land-marks by which we are to guide ourselves in all our proceedings, mentions the following as one of the most prominent: “To protect the manufactures adapted to our circumstances.”

    Our protective system, under the Tariff Act of 1780, had produced results far greater and more satisfactory than had been anticipated ; and in 1806 Mr. Jefferson found that there was likely to be a considerable surplus after paying all the public debt called for by our contracts ; and in his sixth annual message he thus presents his views to the country as to the best method of disposing of that surplus : ” Shall we,” he asks, ” suppress the imposts (duties) and give that advantage to foreign over our domestic manufactures ? On a few articles of more general and necessary use, the suppression in due season, will doubtless be right; but the great mass of the articles on which imposts are laid,are foreign luxuries, purchased by those only who are rich enough to afford themselves the use of them.”

    Again he wrote : ” The general inquiry now is, shall we make our own comforts, or go without them at the will of a foreign nation ? He, therefore, who is now against’domestic manufactures, must be for reducing us either to a dependence upon that nation, or to be clothed in skins and live like beasts in caves and dens. I am proud to say I am not one of these. Experience has taught me that manufactures are now as necessary to our independence as to our comforts.”

    ‘The prohibiting duties we lay on all articles of foreign manufacture, which prudence requires us to establish at home, with the patriotic determination of every good citizen to use no foreign article which can be made within ourselves, without regard to difference of price, secures us against a relapse into foreign dependency.”

    In his letter to Humphrey, 1809, he wrote : ” My own ideals that we should encourage home manufactures to the extent of our own consumption of everything of which we raise the raw materials,”

    In 1817, after the close of the second war with Great Britain, in accepting an election to membership in a ” Society for the Encouragement of Domestic Manufactures,” Jefferson wrote: “The history of the last twenty years has been a significant lesson for us all to depend for necessaries on ourselves alone ; and I hope twenty years more will place the American hemisphere under a system of its own, essentially peaceable and industrious and not needing to extract its comforts out of the eternal fires raging in the old world.”

    JAMES MADISON, our fourth President, recognized as ” the Father of the Constitution,” in a special message to Congress, May 23, 1809, said: ” It will be worthy of the just and provident care of Congress to make such further alterations in the laws as will more especially protect and foster the several branches of manufacture which have been recently instituted or extended by the laudible exertions of our citizens.”

    Again, in a special message, Feb. 20, 1815, Mr. Madison said: “But there is no subject that can enter with greater force and merit into the deliberations of Congress than a consideration of the means to preserve and promote the manufactures which have sprung into existence and obtained an unparalleled maturity throughout the United States during the period of the European wars. This source of national independence and wealth I anxiously recommend, therefore, to the prompt and constant guardianship of Congress.”

    JAMES MONROE, our fifth President, in his inaugural said : ” Our manufactures will likewise require the systematic and fostering care of the government. Possessing, as we do, all the raw materials, the fruit of our own soil and industry, we ought not to depend, in the degree we have done, on supplies from other countries. Equally important is it to provide at home a market for our raw materials, as by extending the competition it will enhance tlfc price and protect the cultivator against the casualities incident to foreign markets.”

    In his seventh annual message he says : ” Having formerly communicated my views to Congress respecting the encouragement which ought to be given to our manufactures, and the principle on which it should be founded, I have only to add that those views remain unchanged. I recommend a review of the tariff for the purpose of affording such additional protection to those articles which we are prepared to manufacture, or which are more immediately connected with the defense and independence of the country.”

    Here, then, are the views in brief of our first five Presidents, and the foremost men of the years in which the Tariff Act of 1789 was a law. We find no hint of dissatisfaction with protection ; no suggestion of a repeal of the law, and no intimation of a modification of the tariff laws, except to give them ” a prompt and constant guardianship ” and “additional protection to those articles we are prepared to manufacture,” etc.

    “Abandonment of the protective policy by the American government must result in the increase of both useless labour and idleness; and so, in proportion must produce want and ruin among our people.”

    Abraham Lincoln

    Alfred E. Eckes, Jr.
    Opening America’s Market: U.S. Foreign Trade Policy Since 1776

    U.S. TARIFF HISTORY 1821-2000

    YEARS……………..AVERAGE EFFECTIVE TARIFF (% tax on all imports)





    The income tax was created in 1913, just in time to be around to fund WW I :


    Up until 1916, the tariff was the largest single Federal revenue source.

    1917 was the first time in U.S. history that the income tax surpassed the tariff and we’ve never looked back since then.


    IMPORTS = $2,345.983 billion
    (source: )

    TARIFFS = $26.010 billion of which $1.339 billion came from trust fund revenues.
    (source: Table 2.5 p.50 of 342)

    $26.010 – $1.339 = $24.671 billion

    $24.671 / $2,345.983 x 100% = 1.0% EFFECTIVE TAX RATE

    U.S GDP = $13,841 billion
    (source: )

    Imports as a percent of U.S. GDP are now a staggering 16.9% of GDP yet only pay 1.0% effective tax rate.

    Percent of Federal revenues paid by tariffs in 1905 was 47.4%

    In 2002, 49% of all Federal revenue came from the personal income tax.

    The entire U.S. economy now suffers under a 30% effective tax rate.

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    1. C. Mantix

      “We don’t need government agreements to have free trade. We merely need to lower or eliminate taxes on the American people, without regard to what other nations do. Remember, tariffs are simply taxes on consumers. Americans have always bought goods from abroad; the only question is how much our government taxes us for doing so. As economist Henry Hazlitt explained, tariffs simply protect politically-favored special interests at the expense of consumers, while lowering wages across the economy as a whole. Hazlitt, Ludwig von Mises, Friedrich Hayek, Murray Rothbard, and countless other economists have demolished every fallacy concerning tariffs, proving conclusively that unilateral elimination of tariffs benefits the American people. We don’t need CAFTA or any other international agreement to reap the economic benefits promised by CAFTA supporters, we only need to change our own harmful economic and tax policies. Let the rest of the world hurt their citizens with tariffs; if we simply reduce tariffs and taxes at home, we will attract capital and see our economy flourish.”

      - Dr. Ron Paul



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      1. Steve O'Connor

        C. Mantix Quote:

        “As economist Henry Hazlitt explained, tariffs simply protect politically-favored special interests at the expense of consumers, while lowering wages across the economy as a whole.”

        Absolute, historical nonsense.

        First, an elementary fact that economists from Ludwig von Mises and Friedrich Hayek, to Thomas Malthus, the French economist, J.C.L.Simonde de Sismondi, Karl Marx, and essentially every modern economist agrees upon:


        You talk of consumers as if they come from Mars and producers come from Venus. THEY ARE ONE AND THE SAME.

        Now, the historical evidence that you and every Austrian economics zealot (AND I DO MEAN ZEALOT – YOUR FREE TRADE UTOPIAN DREAM IS MORE IMPORTANT THAN HISTORICAL FACT – CHALLENGE MY FACTS) chooses to ignore, censor, throw out, push aside, pretend it never happened, etc…………

        The French Commission, in their report of the Centennial Exposition in 1876, declared “that under the shelter of a prohibitory system the people of the United States have organized a powerful industry which rivals England in cheapness.”

        The German Commission also stated that “the present condition of American manufactures show the fallacy of the free trade doctrine, that the products of a country are raised in price by Protective duties.

        Before the Tariff of 1828 English axes sold here for from $2 to $4. By the Tariff a duty of 35% was levied on axes. In 1836 foreign and home-made axes were selling side by side at from $1.25 to $1.35 each, and in 1876 they sold for 80 cents each, a decrease to one-quarter of the price of 1828, as a result of home industries fostered by a Protective Tariff.

        In 1840 the English furnished us our saws at from $15.75 to $19 per dozen; with a Tariff of 45% on saws they sell at from $5 to $10 per dozen, which is a saving of one-half the price of a saw to every farmer and mechanic. Beside, the superior methods which we have devised in the manufacture of saws enable us to undersell England in her own markets.

        The average price of the salt per barrel, made at Saginaw during the year 1866, was $1.80, the duty being 34 cents per barrel; in 1882 the average price had been reduced to 74 cents per barrel, or but 40 cents more than the duty. Is the duty added to the price of the commodity ? Is the consumer not benefited by the Tariff which enables us to produce annually 40,000,000 barrels of salt and sell it at less than one-half its former price ?

        An importer of such goods (crockery) testified before the Tariff Commission: “I have here a tumbler, known to the trade as a whiskey tumbler; six years ago, when American manufacturers commenced to make them, they were imported by the case at $1.40 per dozen; we made some, the first price was $1.25. They now sell for 40 cents.” The duty levied was 40%; as a result we have the article for 16 cents less than the duty upon the original cost before home production began. Not only has the price decreased, but a large industry has been built up which employs thousands of men and millions of capital, making a home market for our products and increasing the wealth of the country.

        Before the Tariff of 1860 steel for locomotive tires cost 30 cents per pound; today, with a tariff of 2 ½
        cents per pound, they are selling for 5 ½ cents. Wagon tires which sold for 16 cents per pound, with no duty, now sell for 7 cents with a duty of 3 cents per pound.

        When the English controlled our market they sold us cast steel for 17 ½ cents per pound which they now sell us at 10 ½ cents, although in their near market in France they get 12 ½ cents for the same article. The reason is that the duty of 45% has so developed our industries that we control our market and fix the price 2 cents lower than it is in France, and the English must sell at our price or not at all.

        When the Tariff was removed in 1846 iron rails were selling at $50; the English immediately reduced the price to $40, until our mills were closed; then they advanced the price to $60, finally to $75 a ton; between 1850 and 1854 England sold us 800,000 tons at $75; all of which we might have produced with a Tariff of $10 and kept the price down to $50, and saved $20,000,000 to American railroad owners. In 1867 steel rails sold at $166 currency, with no Tariff, we produced but 2,277 tons. In the year 1883, with a Tariff of 1 cent a pound in force for 15 years, we produced 1,500,000 tons at $40, and the importation of steel rails has decreased from 182,135 tons in 1882 to 2,395 in 1885. It is estimated that we have produced $1,800,000,000 worth of rails since we began their manufacture; this is so much added wealth to the country, which has given just that much encouragement and profit to our labor, mines, farms and other manufactures. A like increase in product and decrease in price can be shown in all departments of our iron industry.

        The development of our bituminous coal beds under a Tariff of 75 cents a ton enabled us in 1884 to put out a product worth $143,700,000, much of which was sold at the mouth of the pit for $1 a ton, while the English paid $1.18 for the same grade of coal. Does this not show that it will profit a nation to grant a protective Tariff, or even a bounty, on any industry if thereby her own abundant resources may be developed ?

        The Defender
        Home Production
        April 28, 1890

        A glance at the history of prices of tin plate for twenty years past will make clear the necessity and propriety of the McKinley tariff, and, at the same time, illustrate the characteristic policy of British free trade manufacturers. “In 1873, British importers advanced the price of tin plate to $12 a box, in American markets ; and at once, American tin-plate factories commenced operations. British importers within three years reduced the price to $4.50 per box, and our mills had to shut down. When this was done British importers advanced prices to $9 and $10 per box, and under this stimulus, in 1879, American mills again started up. As soon as they were well at work, British importers again reduced the price to $4 per box ; and then made a standing offer or more properly a threat, to sell their tin plate twenty-five cents a box cheaper than the American product, no matter what the price of the latter might be. Of course, this action completely finished the American industry, and prices were at once advanced from $4 to $7 per box.”

        The McKinley tariff put an end to this outrage and robbery, and this fact alone is sufficient justification for its enactment.

        It puts a duty on tin plate so high that it will probably soon transfer the most of that great industry to this country. Already many large plants are in process of erection, or have been completed, and are producing a superior tin plate, at Brooklyn, Pittsburgh, Chicago, St. Louis, and other places, and others will soon go up. The largest mines of tin in the world have lately been found in the Dakotas, California, Texas and Virginia ; so that it is morally certain that in the near future we shall be able to produce at home the full supply of tin and tin plate that we need, and which now amounts to over $30,000,000 in value annually,

        When this is accomplished it will afford a new business that will annually pay to American labor not less than $23,000,000 ; it will require from iron ore miners not less than 1,000,000 tons of iron ore more than they now produce ; from limestone quarries 300,000 tons more of limestone ; from coal mines and coke ovens 2,000,000 tons more of coal and coke ; from blast furnaces 400,000 tons more of pig iron ; from lead mines and smelting furnaces 5,500,000 pounds more of lead ; from slaughter and packing houses 13,000,000 pounds more of tallow and oil; from chemical factories 40,000,000 pounds more of sulphuric acid ; from lumber yards 12,000,000 feet more of lumber ; and will give constant work to at least 35,000 persons. Indeed, it is already (1892) in large part fulfilled.

        D. G. Harrimon
        American Tariffs From Plymouth Rock To McKinley, 1892
        p. 65-66





        “By the late 1980′s, Japan dominated America’s television and consumer electronics markets. The logical next step was to squeeze extra profits from this dominant position.
        In 1989, New York Attorney General Robert Abrams revealed that Panasonic and Technics (both subsidiaries of Japan’s Matsushita) had mounted a verticle price-fixing scheme in America. Matsushita, of course, was a founding member of the television cartel. The Panasonic/Technics scheme was hauntingly reminiscent of what the Home Electric Appliance Market Stabilization Council had pulled off in Japan in the 1950′s.
        Abrams revealed that between March 1988 and August 1989 the Japanese companies had forced their American retailers – among them, Best Products, K Mart, Montgomery Ward, Circuit City – to charge fixed minimum prices for their products. Though his charge referred only to the sixteen most popular products of Panasonic and Technics – VCR’s, camcorders, cordless telephones, answering machines, and stereo equipment, among other items – Abrams said that the firms had, in earlier efforts, tried to set fixed prices on all three hundred items they sold in the United States.
        Through their scheme, the firms artificially had raised their U.S. prices by 5 to 10 percent. Abrams said the price-fixing was administered “through an elaborate nationwide scheme involving scores of [Panasonic and Technics] sales executives pressuring thousands of retailers to comply with the scheme and monitoring the prices they actually charged.”
        To enforce this price-fixing effort, Panasonic directed its executives to keep all U.S. retailers of Panasonic goods in step with the firm’s policies. Panasonic told its employees that “those dealers not adhering to company policy could ‘create chaos in the marketplace’ and would allow Panasonic to ‘lose face with the entire industry.’ “
        The question that lingers is whether the rest of “the entire industry,”as Panasonic called it, really did know about Matsushita’s price-fixing activities. If they did not, then how could Panasonic “lose face”? More important, were other consumer electronics companies participating in similar verticle price-fixing schemes?
        When Abrams confronted Panasonic and Technics, they immediately agreed to a settlement – without actually acknowledging wrongdoing. The settlement required the companies to stop price-fixing, to repay $16 million in overcharges to nearly 700,000 customers, and to pay another $2 million to the state for settlement administration costs.
        The settlement also revealed:

        Lechmere, Inc., a retailer with stores in New York and other northeastern states, was told by Panasonic that it would “make an example of dealers charging below the ‘go’ price [the fixed price] and would terminate all or part of its shipments to noncomplying dealers.”

        When Luria and Sons, a Florida retailer, undercut Panasonic’s fixed price on a cordless telephone, four different Panasonic representatives threatened that Panasonic would cease doing business with noncomplying retailers.

        As in Japan, this sort of price-fixing allows the manufacturer to gain an earned monopoly profit, which can then be used to subsidize dumping and other anti-competitive behavior.

        But the Japanese were able to extort monopoly profits from American consumers because America’s own television industry in effect had been destroyed by two decades of illegal, anti-competitive behavior by the Japanese.”

        Pat Choate
        Agents Of Influence, 1990
        p. 102-103

        “After several years of lengthy and detailed studies and hearings concerning the problem of sharply increasing fastener imports and the impact that this has had on the U.S. fastener industry, the International Trade Commission recommended to President Carter that higher tariffs be imposed. On February 10th, President Carter rejected the ITC’s recommendation, saying that fastener tariffs would be inflationary and not in the nation’s best economic interest…..

        The Japanese already have demonstrated how quickly fastener prices can increase when they have a market monopoly (400% increase for some fasteners during 1973-74). While President Carter is concerning himself with inflation, I hope that he will give serious consideration to this possibility.”

        Bob Kelly, Editorial Director
        “Let’s Get Our Act Together on Trade”
        Assembly Engineering, May 1978





        The protectionist Japanese laugh at the Austrian school, the same Japanese that with only 40% of the U.S. population are now the worlds’ largest automaker, the worlds’ largest machine tool maker, second largest steel producer – only behind protectionist China, the global leader in robot technology, largest producer of electronic time pieces, the world leader in LCD production, etc….


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        1. Steve O'Connor

          And the other side, what has historically happened to nations that adopted free trade. Besides the disaster of the U.S. between 1783-1789 which gave birth to our present Constitution, these other examples are inconvenient truths for the free trade zealot.

          Ireland And Free Trade

          “The only country in the world I know of that has thoroughly free trade forced upon her by compulsory process is that most distracted and unfortunate land, Ireland. Before the union her manufacturing industries were protected against England by duties on woolens, silks, cotton, yarn, and twist, and cotton manufactured goods. Her calicoes and muslins were protected by a duty almost prohibitory, and Ireland was rapidly becoming a successful manufacturing country. Her people were happy, contented, industrious, and prosperous. There was a loom in almost every house, and with it comfort came, too. Her linens were known and appreciated all over the world, and her silks were gaining a ready market.

          There were in 1800, as appears by an imperfect census then taken, over 8,000 weavers employed in Cork alone, over 5,000 manufacturing woolen goods in Dublin, 3,000 making blankets in Balbrigan, 2,000 weaving calicoes in Wicklow, 1,000 making flannels, while the numbers engaged in linen work were immense.

          This linen trade was encouraged by subsidies, but they were gradually withdrawn until all protection ceased in 1826. In 1825 more than thirteen million of dollars were expended in the purchase of coarse, unbleached, home-made webs of linen. “What a power of good, of comfort, and of happiness, those home-made webs revealed.

          England, not content with destroying Ireland’s navigation, with crushing out, in the earlier days, her manufacture of woolens, greedy to manufacture for the world, determined that the rest of mankind should raise the raw materials to feed her hungry looms, as the South wanted us to feed their slaves, beguiled poor Ireland into assenting to the act of the union, under the terms of which every duty was repealed—some gradually, to be sure, but certainly. The act continued the tariff on woolens for twenty years, terminated it on calicoes and muslins in 1821, on cotton yarn and twist in 1816, withdrew all subsidies in 1826, and Ireland enjoyed the benefit of absolute free trade.

          What was the result? England held both ends of the bargain. Ireland could raise in her fertile soil the raw material. England could make it into goods cheaper than she could, but Ireland had no voice in the price to be paid for either.

          In 1840, another census was taken, and there were 500 blanket-makers in Kilkenny, 200 silk- weavers in Dublin, no carpet makers in all Ireland, no linen- weavers in Cork, 300 operatives in that city in all the manufacturing industries, where fifteen years before there were 8,000 weavers alone.

          Free trade had done its work and Ireland was starving. She is the only absolutely free trade country in the world today, the only land enjoying its rare privileges in complete fullness, and what a commentary it affords with a good climate, a fertile soil, great rivers, splendid water-power, broad, safe bays and harbors, an abundance of minerals, an industriously-inclined people, it is the most terribly vexed, troubled, suffering, distracted, impoverished, starving country in the world.

          Irishmen, loving their land earnestly and with more unbounded enthusiasm than the men of any other country, have been driven into exile by the millions. Now, I do not blindly charge all of her woes to free trade alone; land tenure has to answer for a portion, not for more than half. Give her a parliament of her own, and the first act passed would be a protective tariff, and in twenty years from now the exiled Irishman would return to the land he loves and find it peaceful, contented, and prosperous. England, for her own selfish purposes, fastened these two fearful leeches upon her, and they have been fattening on her blood.”

          Senator William Pierce Frye
          Speech in the United States Senate, February 10,1882

          “We give to our rivals a free market of 43,000,000 persons in the United Kingdom to add to their own free market. Thus the United States possess an open market of 82,000,000 persons in the United States, plus an open market of 43,000,000 persons in Great Britain, making, altogether, 125,000,000. Similarly, Germany possesses an open market of 43,000,000 in Great Britain. As against this, we posses only such residule of our open market of 43,000,000 as the unrestricted competition of foreign nations leaves unimpaired…We call ourselves Free Traders, but we have never secured Free Trade for ourselves; we have merely succeeded in enlarging the area within which our Protectionist competitors enjoy Free Trade.”

          John Stuart Mill
          “The Op-Ed History of America”
          p. 23

          Even the rabid Free-Trader, John Maynard Keynes, had to back track on his free trade religion after he witnessed the whole sale gutting of Britains’ economy by free trade:

          “Defense of free trade theory is, I submit, the result of pure intellectual error, due to a complete misunderstanding of the theory of equilibrium in international trade – an error which it is worthwhile to extirpate if one can, because it is shared, I fancy, by a multitude of less eminent free traders. Does he (William Beveridge-London School of Economics) believe that it makes no difference to the amount of employment in this country if I decide to buy a British car instead of an American car?”

          The Collected Writings of John Maynard Keynes
          vol. 20 p. 508

          Pennsylvania steel manufacturer Joseph Wharton argued that imported steel rails from England had cost $165 in gold per ton in 1864; five years later, behind a protective tariff, a U.S. steel industry was producing all of America’s needs for $80 per ton.
          By 1880, the United States behind a protective tariff, was second only to Great Britain in its share of world manufacturing output, with the U.S. producing 14.7 % compared to Britain’s 22.9%. By 1913, the United States was producing 32% of the world’s output compared to Germany at 14.8% and a sinking, free trade Britain at 13.6%. “We lead all nations in agriculture; we lead all nations in mining; we lead all nations in manufacturing,” President McKinley declared. “These are the trophies we bring after twenty-nine years of a protective tariff”.

          From 1869 to 1900, the gross national product quadrupled.
          The United States ran budget surpluses every year from 1866 to 1893.
          The national debt was reduced by two-thirds; by 1900 it was less than 7% of the GNP.
          Customs duties provided 58% of all federal revenue from 1869 to 1900.
          There was no income tax – save Lincoln’s wartime tax and Cleveland’s brief 2% flat tax on the rich, which was declared unconstitutional.
          Between 1870 and 1900, commodity prices fell 58%.
          Real wages, despite a doubling of the U.S. population, rose 53 percent.
          Annual growth of the U.S. economy averaged more than 4% a year from 1870 to 1913.
          From 1870 to 1913, U.S. industrial production rose 4.7% a year, compared with 2.1% a year in free trade Britain.
          American exports grew by almost 5% a year from 1870 to 1913, while free trade Britain’s grew less than 3%.
          Protectionist America’s share of world exports rose from 7.9% in 1870 to 12.9% in 1913 – while free trade Britain’s fell from 18.9% to 13.9%.
          Between 1869 and 1910, merchandise imports fell from 8% of the GNP to 4%.
          The United States began the era with half of Britain’s production and ended it with more than double Britain’s.

          By 1885, the United States had surpassed Great Britain, then considered the world’s major industrial power, in manufacturing output. By the turn of the century, it was consuming more energy than Germany, France, Austria-Hungary, Russia, Japan, and Italy combined. Between the 1865 and 1900, American coal production rose by 800%, steel rails by 523%, railway track mileage by 567%, and wheat production by 256%.

          And worst of all, after Britain repealed her corn laws, she became so dependent on American grain for food that when World War I came she nearly starved from German U-boat blockade. Between 1846 and 1910 British imports of wheat grew 1,000 percent. On the eve of WW I, once self-sufficient Britain could only grow enough wheat to feed a fourth of her population.

          Rear Admiral William S. Sims, in some ways a Rickover type, loquacious and nonconforming, but withal a very handsome sailor, was already on his way to London for a reconnaissance; he reported to the Admiralty three days after the United States entered the war. Admiral Jellicoe, now the First Sea Lord, showed him the figures on the U-boat sinkings. The Allies had started the war with twenty-one million tons of shipping, or about six million tons more than was essential to feed Britain and keep the deployed armies supplied. The shipbuilding program had not quite stayed apace with the loss rate. Now, according to Jellicoe’s figures, the U-boats had wiped out one third of the six-million margin in two months. The March (1917) losses had been 500,000 tons; April losses would pass 800,000. Said Sims: “Looks as if the Germans are winning the war.”
          “They will unless we stop those losses,” replied Jellicoe.

          The American Heritage History of World War I
          p. 206



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          1. SS

            Can you have a conversation without the copy&paste jobs?

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          2. Penny

            Tariffs Will Make the Global Economic Collapse Much Worse: Part 1


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    2. SCP

      The Revenue act of 1862 created the “income tax”. You can find the actual documents at the library of congress.

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  31. Jason

    I’m a small/med business owner I would love a referral to a good tax guy (cpa, attorney) who could “legally” help me structure my business and reduce my taxes. anyone care to share this priceless resource???

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    1. SCP

      Read the internal revenue code. Section 7701 of USC 26 give the definition for “trade or business” as well as “includes and including”. See if you are even legally liable to report to the IRS.

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    2. wesley


      Your might as well ask me to refer you to Obama for advice : read my recommendation for “Cracking the Code” a few comments up.

      And what’s with all the thumbs down on simple questions …. Are the feds on here or something?

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  32. Joe Parrillo

    Dear Dr. Paul,
    In last year’s presidential primary in New Jersey, you got my vote. For president, I voted for neither of the two bankrupt party candidates. In 2008, when the GOP gave us John McCain, I decided that was the “straw that broke the camel’s back”, and jumped the sinking Republican ship. I then cast my vote for Chuck Baldwin, the Constitution Party candidate (who you also supported). I surely hope you decide again to make a 2010 presidential run; if you do, you not only would have my vote but my help as well to make that a realty. However, it is clear from 2008′s primary, the Republican Party will not throw their support behind you; rather they’ll again throw you under the bus. You should consider going to The Constitution Party or Independent. Either way, I’m on the Paul Team! Keep up the good work! Joe Parrillo

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  33. Juggergrimrod

    This is from The American Monetary Institute!

    Background: The Fed is a private organization, not a part of our government.
    The Federal Reserve System consists of 12 regional Federal Reserve banks, with boards of directors, under an umbrella
    direction of the seven member Federal Reserve Board in Washington, which has the power to determine major aspects
    of banking activity, such as setting interest rates, and the reserve and other operational requirements. There are no shares
    of the Washington Fed Board organization; the only “ownership” of the Fed is in shares of each of the 12 regional
    banks. They are entirely owned by the private member banks within their respective districts, according to a formula
    based on member bank size. The ownership is highly restricted in that such ownership is mandatory; the shares can’t be
    sold; and they pay a guaranteed 6% annual dividend.
    Thus the stories that the Federal Reserve is “owned” by foreign bankers (the Rothschild’s and other prominent banker
    names usually come up) are not accurate and these types of rumors have mainly served to discredit wholesome criticism
    of the banking system.
    It will be clear from the following facts that the Fed is definitely not part of the US Government.
    *The Fed is not organized within the Executive, Legislative or Judicial branches of our government.
    *Who pays the Fed’s bills and determines its budget? Not any part of our government. The Fed gets its funding from its
    own specially privileged operations. The Fed Board determines Fed budgets.
    *Who monitors and oversees Fed activities? Again the Fed itself. While some important elements of proper auditing
    have taken place, there has not yet been a comprehensive independent audit, by the Government Accountability Office
    as proposed in a recent letter from Ralph Nader to new Fed Chairman Ben Bernanke, calling for greater monetary
    *Federal Reserve employees are not part of the US Civil Service System and are not covered by government
    employees’ health insurance or pension programs. Who does the hiring and firing? Except for the highly publicized
    Chairman and seven member Washington Board, this is in private, unelected hands.
    *Federal Reserve Banks are not listed as government organizations by the telephone companies, a small but telling fact.
    The ambiguity surrounding the Fed arises because the U.S. President appoints the Fed Chairman to four year terms, and
    the seven member board to 14 year terms. Also the Fed is supposed to implement government fiscal policy, but it has not
    really done so. (see Is the Federal Reserve System Part of the U.S. Government, at our website
    Several structural problems arise from private control: The system tends to be run to benefit those in control rather than
    the whole society. This concentrates wealth into fewer and fewer hands. The interest received by the banking system for
    money creation flows into their hands. The control over where the money goes determines the direction the society
    moves in. Privately controlled money tends to go into speculation to make a quick buck. Infrastructure, health and
    education get ignored or short changed.
    The private banking system, not government, now creates our money in the form of debt.
    Most Americans think our money is issued and controlled by our government. They are surprised to learn that most of
    our money is created when people and businesses have to borrow from banks, since this is the main way that money now
    enters the system. The banks make loans by crediting the borrowers account. This is fiat money, or “purchasing media”
    created out of thin air, thanks to a special legal privilege granted to them called “fractional reserve banking.” They write
    a computer credit in the account of those whose needs have driven them to the banking system to borrow money.
    This concentrates great power and transfers tremendous wealth to the financial sector.
    Under this privately controlled monetary system, it’s not surprising that wealth and power have become concentrated to
    obscene levels never before seen in our society, where less than 1% of the population is now claiming ownership of
    nearly 50% of the nation’s wealth!
    This money creation prerogative, often referred to as “THE MONEY POWER,” (President Martin Van Buren always
    capitalized it!) has traditionally been associated with national sovereignty. Alienating the power from government into
    private hands has inevitably served to concentrate elements of what should remain national sovereign power into those
    private hands, where predictably it has been used to promote the interests of the few in control rather than the society as
    a whole. That is clearly unacceptable in both a democracy and a republic. It establishes plutocracy – the rule by wealth

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  34. Janice

    Bank of America rejects SEC claims in bonus suit
    NEW YORK, Sep. 25, 2009 (Reuters) — Bank of America Corp formally denied U.S. Securities and Exchange Commission claims accusing it of misleading shareholders about bonuses it let Merrill Lynch & Co pay employees before the companies’ January 1merger, and said it is seeking an order dismissing the regulator’s complaint. ..

    The bank’s response, in a Friday filing, was expected, and came 11 days after U.S. District Judge Jed Rakoff rejected its $33 million settlement with the SEC over the $3.6 billion of bonus awards.
    > full story

    I didn’t get my credit card interest rate decreased to 3.5% like the government workers did……

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  35. Janice

    Your Tax Money…..paying out alot of Government Salaries, and CEO’s Bonus’s. I didn’t think I worked for the government did you….I didn’ get a $5,000 breakfast once a week from a lobbyist. I don’t get a Loan from the Gov. at 3.5 % interest, I don’t get a bail out of my credit cards..the credit card company did but I didn’t. Why is it if I don’t work for the government, but for Corporate America, why is it 40-70% of my income goes to all kinds of Federal Taxes? I don’t get free healthcare like they do either…and an assured 401K. I just don’t understand this system we have allowed to Freely take all of our money…I just thought about this….Does anyone have any answers?

    The Department of Energy was created by President Carter in 1977 for the stated purpose of advancing the energy security of the United States. The Department now employs 109,000 people and spends $24 billion of taxpayer funds every year. The accomplishments of those well-funded 109,000 people have been few. We are about to learn in a way that no one will be able to overlook just how few.
    Neglect of Infrastructure

    The infrastructure for producing petroleum products is rusting away and falling apart.

    Not a single oil refinery has been built in the U.S. since 1976. The number of U.S. refineries has dropped to 149, less than half the count in 1981. Because of operating improvements and expansions at the surviving refineries, shrinkage in capacity has been held to only 10%. Meanwhile, however, gasoline consumption has risen 45%.

    As new sources of easy-to-refine light oil become harder to find, the world will become more dependent on its abundant sources of difficult-to-handle heavy crude. One-third of Saudi Arabia’s 260-billion-barrel reserves are heavy crude. Worldwide, about 40% of oil resources are heavy or extra-heavy crude, and another 30% are in oil sands and bitumen, which are even more difficult to refine.

    The U.S. isn’t ready for heavy crude. Only 30% of U.S. refineries can process it. And the U.S. isn’t doing anything to get ready. It won’t invest in anything that doesn’t look like a sick bank. Refinery capacity is already a bottleneck, and the bottle’s neck is narrowing.

    The U.S. is clearly a laggard in refining. Canada, where 95% of reserves are in oil sands, has seen a rush of investment into producing and processing the super-dense resource. Saudi Arabia has promised billions of dollars in the next five years to expand its refining capacity to 6.5 million barrels per day, from the current 3.7 million, which will make them one of the largest refiners in the world. Meanwhile, the U.S. twiddles its thumbs and mumbles NIMBY.

    The human element of the energy infrastructure is also in decline. Matt Simmons, the author of Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy, warns that the best-qualified petroleum geologists and engineers are now retiring, with no one to take their place.

    Growing Demand for Oil

    The world’s population will continue to grow, and developing countries will continue to grow more prosperous. Both trends will add to the demand for fossil fuels.

    China and India are sucking up oil at an ever-increasing rate. China has seen oil consumption grow by 8% per year since 2002; it now exceeds 8 million barrels per day. China’s middle-class population is nearing 300 million people. While U.S. auto sales were plummeting in 2008, China’s auto sales rose 6.7%, to 9.38 million units. Sales in the first five months of 2009 are 14% above a year earlier.

    India’s automobile sales are on pace to exceed 10 million in 2009. By 2020, the country’s oil imports are expected to more than triple from 2005 levels, rising to 5 million barrels per day.

    It isn’t just China and India that are adding to demand for oil. Others, notably Russian and Brazil, are doing the same. The non-OECD countries now have surpassed the OECD countries in energy usage. This trend will accelerate as the citizens of these countries grow wealthier and buy cars, TVs, and refrigerators.

    Get ready for some loud but useless noise. When oil reaches $200 a barrel in the next few years, Congressmen will yell, posture, expound, skewer oil executives on TV, and get red in the face. They will do everything but admit the truth. We will be paying for decades of underinvestment in commodity infrastructure, mal-investment in ethanol, and lack of realism in answering the complaints of Green extremism.

    The Department of Energy was created by President Carter in 1977 for the stated purpose of advancing the energy security of the United States. The Department now employs 109,000 people and spends $24 billion of taxpayer funds every year. The accomplishments of those well-funded 109,000 people have been few. We are about to learn in a way that no one will be able to overlook just how few.

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