by Texas Congressman Ron Paul
May 7, 2001
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.
Read more.
April 15th, 2009 | Posted in Web-Only Content | Read More »
Watch full sized version by clicking here
April 14th, 2009 | Posted in Web-Only Content | Read More »
By Paul Craig Roberts (archive)
April 14, 2003
Now that you have paid your income taxes, calculate how much you own of your own labor.
You can do this by dividing the federal, state and local income taxes you paid (including Social Security and Medicare) by your taxable income.
Generally speaking, the higher your income, the less you own of yourself. A person with $300,000 in taxable income will discover that government in the year 2002 has a claim to about one-third of his labor – the maximum tax that could be levied on a medieval serf.
If you have a low income or work primarily off the books, you will be rewarded with an “earned income tax credit,” that is, you will receive a tax “refund” even though you paid no tax. You not only own all your own labor, but also have legal claims to the incomes of higher income persons.
Democracy produces the opposite results of feudalism. Instead of an upper class living off the sweat of a lower class, the lower class lives off the sweat of an upper class.
Philosophers such as John Rawls created a philosophy to justify the latter as “moral” and the former as “immoral,” but it all comes down to the same thing: some people live off other people’s activities.
Income taxes are not the only taxes. There are property taxes, wealth taxes, excise taxes, and sales taxes. If you add together all the taxes you paid, you might find that you own no more of your own income than a 19th century slave. (A slave owed his master about half his work product, the rest being necessary for his own maintenance.)
April 14th, 2009 | Posted in Print Edition | Read More »
By Paul Craig Roberts
March 30, 2009
Obama and his public relations team have made it appear that his trillion dollars in higher taxes will fall only on “the rich.” Obama stresses that his tax increase is only for the richest 5 percent of Americans while the other 95 percent receive a tax cut.
The fact of the matter is that the income differences within the top
5% are far wider than the differences between the lower tax brackets and the “rich” American in the 96th percentile.
For Obama, being “rich” begins with $250,000 in annual income, the bottom rung of the top 5 percent. Compare this “rich” income to that of, for example, Hank Paulson, President George W. Bush’s Treasury Secretary when he was the head of Goldman Sachs.
In 2005 Paulson was paid $38.3 million in salary, stock and options. That is 153 times the annual income of the “rich” $250,000 person.
Despite his massive income, Paulson himself was not among the super rich of that year, when a dozen hedge fund operators made $1,000 million. The hedge fund honchos incomes were 26 times greater than Paulson’s and 4,000 times greater than the “rich” man’s or family’s $250,000.
For most Americans, a $250,000 income would be a godsend, but envy can make us blind. A $250,000 income is not one that will support a rich lifestyle. Moreover, many people prefer lesser incomes to the years of education, long work hours and stress of personal liability that are associated with many $250,000 incomes. In truth, those with $250,000 gross incomes have more in common with those at the lower end of the income distribution than with the rich. A $250,000 income is ten times greater than a $25,000 income, not hundreds or thousands of times greater. On an after-tax basis, the difference shrinks to about 6 times.
Read more.
March 31st, 2009 | Posted in Web-Only Content | Read More »
-
Designed by