The Power to Tax … and Revolt
By Mark Alexander · The Patriot Post (PatriotPost.us)
“An unlimited power to tax involves, necessarily, a power to destroy; because there is a limit beyond which no institution and no property can bear taxation.” –John Marshall
On December 16th, 1773, “radicals” from Boston, members of a secret organization of American Patriots called the Sons of Liberty, boarded three East India Company ships and threw into Boston Harbor 342 chests of tea.
This iconic event, in protest of oppressive British taxation and tyrannical rule, became known as the Boston Tea Party.
Resistance to the Crown had been mounting over enforcement of the 1764 Sugar Act, 1765 Stamp Act and 1767 Townshend Act, which led to the Boston Massacre and gave rise to the slogan, “No taxation without representation.”
The 1773 Tea Act and resulting Tea Party protest galvanized the Colonial movement opposing British parliamentary acts, which violated the natural, charter and constitutional rights of the colonists.
In response to the rebellion, the British enacted additional punitive measures, labeled the “Intolerable Acts,” in hopes of suppressing the burgeoning insurrection. Far from accomplishing their desired outcome, however, the Crown’s countermeasures led colonists to convene the First Continental Congress on September 5th, 1774, in Philadelphia. (more…)
It’s Time for the 16th Amendment to Go!
February, 1913, saw the ratification of the 16th Amendment to the Constitution of the United States and, with it, the empowerment of the Congress “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.” With its passage, Congress’s powers expanded by an order of magnitude. Whereas, previously, federal revenues were largely realized through customs duties and taxes on such things as alcohol and tobacco, Congress now found itself with the power to lay claim to the fruits of the people’s labors, to reach into their pockets and take what it wanted, for whatever reason.
At the time of its passage, one proponent of the amendment, Rep. Cordell Hull, of Tennessee, was quoted in the Los Angeles Times as saying, “One of the important results of an income tax will be the curbing of unnecessary Federal expenditures. When a great part of the government’s income is derived by a direct tax upon the citizens of the nation, they will scrutinize more carefully the appropriations made by Congress.” (more…)
Obama’s Bush Moment?
On Sunday, August 2, the first indications that the free ride might not be free, after all, came to the fore. Treasury Secretary Geithner and Lawrence Summers, of the president’s economic council, both hinted that, in light of the enormous spending program upon which the government has embarked, which will generate gargantuan deficits well into the future, Obama’s grand plan can’t be sustained.
Asked if the middle class, who are part of the 95 percent of us who won’t see our taxes increase, could see a tax hike, neither would rule it out. As Summers said on Face the Nation, “It’s never a good idea to absolutely rule things, rule things out no matter what.” Geithner, on This Week, said, “We have to bring these deficits down very dramatically … That’s going to require some very hard choices.”
Geithner went on to say, “We will not get this economy back on track, recovery will not be strong and sustained, unless we convince the American people that we are going to have the will to bring these deficits down once recovery is firmly established.”
Many Americans have long realized that the promise of no new or higher taxes is little more than legerdemain aimed at winning election, having heard the same promises, not all that long ago, from another man whose eyes were on that most coveted of prizes. Will this turn out to be Obama’s “Bush moment?”
Gregg: The Public Employee Pension Tax, Part II
In my previous post I identified a major problem looming on our financial horizon in the form of public pension underfunding. While it is quite easy to identify a problem, the solution is not always so apparent. I guess it’s time to roll up my sleeves and attempt to offer one.
A Defined Contribution Plan (DCP) was also created with the enactment of the ERISA legislation. These are the 401k and IRA accounts so many of us own. There are certain advantages to these plans over Defined Benefit Plans (DBPs). First of all they are portable, which means if you change employers the funds can move with you. In addition, YOU are directly involved in the investment decisions, so you can tailor them to your personal situation. There are also advantages to the employer in that their obligation is funded almost immediately, which removes any future debt service obligation, and their contributions are a percentage of employee contributions and are not impacted by investment returns. The accounts themselves, however, are subject to the fluctuations of the market, and as we all have seen returns are not always positive. (more…)
Gregg: The Public Employee Pension Tax
When John Galt read one of my posts concerning labor unions, he suggested perhaps it was time to write another article. I readily agreed, but thought I would be clever and write one on pensions instead. Once again, the old adage, “No good deed goes unpunished,” has come true. While I had some idea there was a problem looming on the horizon, what I discovered stunned me.
To begin with, a little background on pensions in the US. The first private pension plan was created by the American Express Company in 1875. By 1930, most large companies offered pension plans and most survived the Great Depression. The ones that failed were the ones funded under a pay as you go system, where benefits were paid out of current earnings rather than funded reserves. The Social Security Act of 1932 began the growth of state and local government pension programs. Pension plans expanded with the Wage and Salary Act of 1942, which was instituted to freeze wages in an effort to curb inflation. Pension benefits were added as an incentive to attract workers when wages could not be increased. (more…)
The Evil Rich: Taxing the American Dream
We all have our view of the American dream. To our Founding Fathers, the dream was freedom and opportunity. Today, the American dream for some is expressed in less conceptual, more materialistic terms, but the essence of the dream is still the same. With freedom and opportunity comes the ability to achieve whatever one defines as success. For some, personal success also provides opportunity for others to achieve their own version of the dream. Success breeds success.
Sadly, the American dream is under attack. Personal and business success has become anathema to those among us who would have us view wealth as something achieved through greed and exploitation. The well publicized self-serving actions of a few have painted all who achieve success with a brush of evil. The small businessman who started in his garage, now enjoys moderate success and employs 50 of his neighbors is lumped in with the bankers and auto executives testifying before Congress. (more…)
