Blog/The Hunt for Taxes
Posted Aug 21, 2020 by Martin Armstrong
We are in need of a qualified lawyer prepared to file a lawsuit against Progressive Taxation as a denial of Due Process and Equal Protection of the law. For centuries, people have debated whether the wealthy should pay more taxes on a percentage basis than everyone else and what even constitutes the wealthy. The definition of the rich has constantly changed. It has now fallen to not just an individual, but to household income. That can easily be expanded to your children if they still live at home because they cannot afford rent or to buy a house thanks to non-dischargeable school loans for worthless degrees. We have unsettled questions as to who is the rich a person or a family, and then just how much more they should pay on a percentage basis compared to everyone else.
These issues have never been resolved despite the fact that the government has been shifting the definitions and presidential elections constantly push class warfare. This notion of “progressive” taxation has escalated into demands to end all freedoms and even confiscate the wealth of the so-called rich which comes down to the top income tax bracket which was $250,000 but expanded to 37% for $518,401 or more.
This issue even sparked one of the early battles over tax distribution. Supporters of progressive taxation favored a graduated tax structure, where the tax rate would increase with the taxpayer’s income. Opponents of progressive taxation believed that a person should not pay a higher tax rate just because he or she earned a higher income for this denies equal protection of the law and creates class warfare which began with Karl Marx.
Thanks to Marx, the debate over progressive taxation began to intensify at the turn of the 20th century with the passage of the Sixteenth Amendment, which permitted a federal income tax whereby the founders prohibited any direct form of taxation. During the colonial days, a tax they created was a “faculty tax” which did not tax income, but your ability to earn income. Then in 1913, Congress passed its first “lawful” income tax which was progressive because this was the attitude that even dominated the Supreme Court at that time.
Before the creation of the United States, taxes were paid to the United Kingdom by the Colonies who also imposed local taxes. The Articles of Confederation did not give the federal government any power to tax leaving that to the States. In England, the king needed the consent of the people to be taxed which is why he would call Parliament who represented the people. But the colonies were not represented in Parliament and hence “no taxation without representation.”
To this day, it is Congress that pretends to have the “consent” of the people to be taxed. Then in 1787, the US Constitution became law and it did give the federal government that power to tax indirectly which was primarily tariffs, and a portion of those taxes had to be given back to the states based on population. The Supreme Court ruled in 1797 what was meant by Direct Taxation (see Hylton v. United States, 3 U.S. (3 Dall.) 171 (1797))
Interestingly, it took one 51.6-year wave of the Economic Confidence Model where the fiscal mismanagement of the states began to put pressure on further taxation. From 1837, some states began to add income and property taxes. The Civil War led to the Revenue Act of 1861 which allowed a federal income tax which was to expire with the Civil War. This was direct taxation which was then found unconstitutional later in Pollock v. Farmers’ Loan & Trust Co., 157 U.S. 429 (1895). It was finally in 1911 when Wisconsin became the first state to adopt an individual and corporate tax. This was upheld with respect to corporations in Flint v. Stone Tracy Company, 220 U.S. 107 (1911).
It wasn’t until the 16th Amendment in 1913, that the federal government was granted the power to levy the income tax on both property and labor and included corporate and individual income tax. This went to the Supreme Court which held that the income tax was then constitutional under the 16th Amendment (see: BRUSHABER v. UNION PACIFIC R. CO., 240 U.S. 1 (1916)). The income tax debate did not begin until it was no longer the rich being taxed, but it was applied under socialism and Roosevelt with the birth of the payroll tax to affect the pocketbooks of an entire nation when people began to pay more attention.
There is no question that many scholars expressed deep concerns about progressive taxations. They criticized progressive taxation on the basis that it was “unfair” to pay greater percentages than one’s proportionate share. Any such proposition that it’s one’s ability to pay is discrimination indistinguishable from race, gender, or religion. Under these same principles, it is unconstitutional to tax one person at a higher percentage because of his ability to pay. This is the very essence of Marxism which not only violates the Ten Commandments, but it clearly divides society creating class warfare.
In 1952, the publishing of “The Uneasy Case for Progressive Taxation,” by Professors Blum and Kalven, did we come to a systematic and very scholarly analysis of progressive taxation. They criticized progressive taxation primarily on economic grounds but conceded its constitutionality. Later in 1985, another book was published: “Takings: Private Property and the Power of Eminent Domain” authored by Professor Richard Epstein. Here Epstein argued that progressive taxation was not constitutional suggesting that the Fifth Amendment Takings Clause prohibited such progressive taxation.
No person shall be … deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
The Supreme Court has never definitively upheld progressive taxation. You cannot have liberty and your right to property which turns on your class any more than on your race, gender, religion, or your sexual preference. The Supreme Court should, in fact, find progressive taxation totally unconstitutional. We may need to challenge this now in order to block the Socialist Agenda about to destroy the very freedoms of the United States.
What we need is a real law firm ready and willing to bring a class action lawsuit to start the only effort we have to prevent Socialism destroying our nation like Venezuela or the old Communist Regimes. You do not create prosperity by stealing from one person and handing it to another. In truth, it never reaches that other person anyway just fills the pockets of politicians.
If it is illegal if an individual robs another, then the same principle applies if politicians exonerate themselves for committing the very same act. Equal Protection means we must all be equal under the eyes of the law. Whatever the tax percentage, it must be equally applied. We need to establish this is the law to end class warfare.