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Author Topic:   Income Tax unconstitutional?
BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 1 of 18 (456527)
02-18-2008 4:33 PM


I have recently seen a documentary called "America: Freedom to Fascism", by Aaron Russo. You can see a 15 minute clip here: http://www.freedomtofascism.com/. It is the second video from the top.
My question to my fellow EVC members is this: Does this documentary have any validity? Is this simply a scare tactic by Russo in an attempt to sell his videos and books? Is the Federal Reserve actually a privately-onwed bank? Is there truly no law that states we must pay income tax on our labor?
I don't know what to think of this. On the one hand I see that some of his arguments are fairly well supported. The IRS uses the 16th amendment in support of their belief that we must pay income taxes, but when examined in greater detail, we see that that is not the case. On the other hand, I can't get over the belief that he may be using scare tactics simply to pawn off his merchandise.
Perhaps it isn't an either or situation. It's possible that his arguments are valid and sound, and that he is trying to sell his merchandise, as well.
What do you think?

Replies to this message:
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Message 2 of 18 (456553)
02-18-2008 7:41 PM


Thread moved here from the Proposed New Topics forum.

  
subbie
Member (Idle past 1255 days)
Posts: 3509
Joined: 02-26-2006


Message 3 of 18 (456556)
02-18-2008 7:48 PM
Reply to: Message 1 by BMG
02-18-2008 4:33 PM


Without wasting my time (and killing my brain cells) watching the video, I'd be willing to bet that the arguments that Aaron makes have all been refuted here.
If he has anything else to say that isn't covered by the Wiki article, can you summarize it for us?

Those who would sacrifice an essential liberty for a temporary security will lose both, and deserve neither. -- Benjamin Franklin
We see monsters where science shows us windmills. -- Phat

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Coragyps
Member (Idle past 735 days)
Posts: 5553
From: Snyder, Texas, USA
Joined: 11-12-2002


Message 4 of 18 (456565)
02-18-2008 8:49 PM
Reply to: Message 1 by BMG
02-18-2008 4:33 PM


I think you need to ask Kent Hovind about this.

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Chiroptera
Inactive Member


Message 5 of 18 (456568)
02-18-2008 8:56 PM
Reply to: Message 1 by BMG
02-18-2008 4:33 PM


The IRS uses the 16th amendment in support of their belief that we must pay income taxes....
I don't know what to make of this statement. The IRS is a government agency established by Congress, like other agencies, in order to execute the laws passed by Congress.
The 16th Amendment to the Constitution explicitly states that Congress can establish a tax on income even when such a tax will not be apportioned among the states according to their populations. Congress has passed laws that states people in the US must pay a tax based on their income, which is allowed by the 16th Amendment. The IRS is simply an agency empowered by Congress to make sure that the tax laws are carried out.
Like subbie, I'm not inclined to watch a video that I'm pretty sure is going to be Hovindesque* in its nuttiness unless someone can give a compelling reason to do so. What, exactly, is the problem with the IRS supposed to be?
Edited by Chiroptera, : *Damn! Coragyps beat me to this!

If I had a million dollars, I'd buy you a monkey.
Haven't you always wanted a monkey?
-- The Barenaked Ladies

This message is a reply to:
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Replies to this message:
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obvious Child
Member (Idle past 4116 days)
Posts: 661
Joined: 08-17-2006


Message 6 of 18 (456578)
02-18-2008 10:21 PM
Reply to: Message 1 by BMG
02-18-2008 4:33 PM


quote:
Is the Federal Reserve actually a privately-owned bank?
No.
quote:
Is there truly no law that states we must pay income tax on our labor?
No, but one common trick that tax dodgers like to claim is mixing the issue of withholding with that of income tax entirely. Withholding is voluntary. You don't have to pay ANY withholding. But you do have to pay income taxes.

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Chiroptera
Inactive Member


Message 7 of 18 (456586)
02-18-2008 11:08 PM
Reply to: Message 6 by obvious Child
02-18-2008 10:21 PM


One can see where that mistake may have come from, however. The privately owned member banks of the Federal Reserve System do own shares in their regional Federal Reserve Bank. But that only makes them a small part of the decision making. And the Federal Reserve System is governed over-all by a government appointed Board of Governors.
So I can see how a propagandist could come up with the idea of the Federal Reserve being privately owned, but it's just not true.

If I had a million dollars, I'd buy you a monkey.
Haven't you always wanted a monkey?
-- The Barenaked Ladies

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BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 8 of 18 (456591)
02-19-2008 12:10 AM
Reply to: Message 3 by subbie
02-18-2008 7:48 PM


I looked over the article, and it seems Russo's claim that the "16th amendment wasn't ratified by the states" is covered in it.
From the article:
Some tax protesters may cite what they believe is evidence that the Sixteenth Amendment to the Constitution (removing any apportionment requirement for income taxes) was never "properly ratified" or that it was properly ratified but does not permit the taxation of individual income...These arguments have been universally rejected by the courts.
Another of his claims is that the Federal Reserve is privately owned. He believes the Federal Reserve prints the money, and thus owns a great deal of power. He posits that the government "borrows" money from the Federal Reserve, is liable to pay interest, and that the income tax we pay to the Federal government goes to the Federal Reserve to pay for the interest fees.
Lastly, in part 1 of the documentary seen here, what unsettles me are the interviews with three former IRS agents that claim they have yet to find a law that states we must pay taxes on our income, or that we must file a 1040.
It's toward the last few minutes of this.
https://www.youtube.com/watch?v=3ueEfRXZCVA

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BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 9 of 18 (456595)
02-19-2008 1:43 AM
Reply to: Message 5 by Chiroptera
02-18-2008 8:56 PM


Hi Chiroptera.
This part 4 of the documentary is the one, if you were to watch only one of the parts, is the one I would like you to analyze.
https://www.youtube.com/watch?v=mbJ1N9Lm__w
If you wish not to view it, I will do my best in breaking down the interview.
He first interviews Sheldon Cohen, a former tax commissioner and one of the authors of the tax code.
First, Russo confronts Cohen about the "voluntary compliance" statement in the tax code. Cohen uses the analogy of stopping at a red light at 2am as "voluntary". The traffic code, however, according to Russo, states that it is mandatory to stop at a red light, and that Cohen is trying to define voluntary as mandatory.
Second, Russo asks Cohen if the government has the ability to prosecute citizens based on the info given on the 1040. Cohen says yes. Russo replies that if the government can imprison you on info stated on your 1040, then it's a violation of the 5th amendment, which protects us from self-incrimmination.
Third, Russo asks if the word income is defined anywhere in the Internal Revenue Code. Cohen responds, "the law says that the government can tax income from any source derived", but Cohen agrees that the word "income" isn't defined in the code.
Russo asks how can American citizens know what income is if it isn't defined in the code.
Edwin Vierra, I believe his name was, a constitutional attorney, states that the Supreme Court ruled in the Eisner vs. Macomber case, that income was defined as "gains or profits from some activity", not wages or labor.
Wages and labor, as claimed by Russo and others, was considered private property. As stated in the Coppage vs.Kansas case, it states that "Chief among such contracts is that of personal employment by which labor and other services are exchanged for money or other forms of property".
One last argument that Russo uses is the Stanton v. Baltic Mining Co. case.
Russo mentions that the result of that case was that the Supreme Court was "conferred no new power of taxation", and that the income tax was unconstitutional.
However, looking at the wiki article, I found the case Russo was trying to use. It states:
Some tax protesters challenge the levying of tax upon individual income, based on language in the U.S. Supreme Court decision in Stanton v. Baltic Mining Co.,[28] to the effect that the Sixteenth Amendment "conferred no new power of taxation, but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged [. . . .]" Tax protesters argue that in light of this language, the income tax is unconstitutional in that it is a direct tax and that the tax should be apportioned
Also from wiki:
The reference to "being taken out of the category of indirect taxation to which it [the income tax] belonged" is a reference to the effect of the 1895 Court decision in Pollock v. Farmers' Loan & Trust Co.,[30] where taxes on income from property (such as interest income and dividend income) ” which, like taxes on income from labor, had always been considered indirect taxes (and therefore not subject to the apportionment rule) ” were, beginning in 1895, treated as direct taxes. The Sixteenth Amendment overruled the effect of Pollock,[31] making the source of the income irrelevant with respect to the apportionment rule, and thereby placing taxes on income from property back into the category of indirect taxes such as income from labor...
This essentially refutes Russo's using of the Stanton case as evidence that the income tax is unconstitutional.
Sorry for the drawn out post. Changing Russo's argument from video to writing is much easier to unpack, for me.
I thank you for your time.
abe:
Third, Russo asks if the word income is defined anywhere in the Internal Revenue Code. Cohen responds, "the law says that the government can tax income from any source derived", but Cohen agrees that the word "income" isn't defined in the code.
Russo asks how can American citizens know what income is if it isn't defined in the code.
It seems Russo left out the Supreme Court case of Bowers v. Kerbaugh-Empire Co., in which Justice Butler states that:
quote:
After full consideration, this court declared that income may be defined as gain derived from capital, from labor, or from both combined, including profit gained through sale or conversion of capital.
Italics mine.
It seems Russo's argument continues to crumble.
Edited by Infixion, : Added the Bowers v. Kerbaugh-Empire Co.

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Replies to this message:
 Message 12 by Chiroptera, posted 02-19-2008 5:16 PM BMG has replied

  
PaulK
Member
Posts: 17822
Joined: 01-10-2003
Member Rating: 2.2


Message 10 of 18 (456596)
02-19-2008 1:45 AM
Reply to: Message 8 by BMG
02-19-2008 12:10 AM


quote:
Another of his claims is that the Federal Reserve is privately owned. He believes the Federal Reserve prints the money, and thus owns a great deal of power. He posits that the government "borrows" money from the Federal Reserve, is liable to pay interest, and that the income tax we pay to the Federal government goes to the Federal Reserve to pay for the interest fees.
The U.S. Government does borrow money and is liable to pay interest on it. And it's borrowing a great deal right now. That's hardly unusual. But that borrowing goes through the Bureau of the Public Debt. The Federal Reserve maintains its own balance sheet, shown in this article Federal Reserve
quote:
Lastly, in part 1 of the documentary seen here, what unsettles me are the interviews with three former IRS agents that claim they have yet to find a law that states we must pay taxes on our income, or that we must file a 1040.
Then it looks like they are incompetent or lying. See this article and references Tax Protestor Statutory Argments This IRS document The Truth About Frivolous Tax Arguments makes frequent references to the law.
It seems to me that this film has very little to do with the facts - and a lot about Russo being hit with a $2 million tax bill.
Edited by PaulK, : No reason given.

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BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 11 of 18 (456600)
02-19-2008 2:45 AM
Reply to: Message 10 by PaulK
02-19-2008 1:45 AM


Then it looks like they are incompetent or lying.
Yes, those seem the most likely causes.
It seems to me that this film has very little to do with the facts - and a lot about Russo being hit with a $2 million tax bill.
Intersting. I was curious as to why this man made a committment towards this. It seemed very likely their was a personal motive: a $2 million dollar motive, it appears.

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Chiroptera
Inactive Member


Message 12 of 18 (456716)
02-19-2008 5:16 PM
Reply to: Message 9 by BMG
02-19-2008 1:43 AM


This part 4 of the documentary is the one, if you were to watch only one of the parts, is the one I would like you to analyze.
I hope that I didn't come off as too snarky, Infixion. If I did, I didn't mean to; I just find watching videos tedious and dull -- I much prefer print sources. I can more quickly skim them to see whether they're worth more careful perusal, and quickly find the relevant points. Of course, if the video is what you found then that's that -- I'm just explaining why I need someone to really convince me that I need to watch the video before I'll commit myself to it. Maybe I'll have time to view it tonight.

If I had a million dollars, I'd buy you a monkey.
Haven't you always wanted a monkey?
-- The Barenaked Ladies

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 Message 9 by BMG, posted 02-19-2008 1:43 AM BMG has replied

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CK
Member (Idle past 4128 days)
Posts: 3221
Joined: 07-04-2004


Message 13 of 18 (456722)
02-19-2008 6:10 PM
Reply to: Message 1 by BMG
02-18-2008 4:33 PM


We did this one recently, you might want to check out the replies in this thread:
http://EvC Forum: Devising the best taxation -->EvC Forum: Devising the best taxation
Edited by CK, : No reason given.

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BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 14 of 18 (456883)
02-20-2008 3:00 PM
Reply to: Message 12 by Chiroptera
02-19-2008 5:16 PM


I hope that I didn't come off as too snarky, Infixion. If I did, I didn't mean to; I just find watching videos tedious and dull -- I much prefer print sources.
No problem, Chiro, I didn't take your post as "snarky". The many of you here at EVC have probably debated and refuted such topics as the one I presented. I, unfortunately, have only heard rumors that the IRS was unconstitutional, and then I saw this documentary, and it played right into my bias.
I'm young, and have a rather great distrust of our federal government, our representatives in congress, and the actions they make. This doc played right into my hands. I didn't analyze it with the proper scrutiny; instead, seeing it was "against the government", my defenses came down a great deal, and instead of "panning for gold", I "absorbed it like a sponge".
I'm just explaining why I need someone to really convince me that I need to watch the video before I'll commit myself to it. Maybe I'll have time to view it tonight.
No need to commit yourself. As I stated in message 9, adding it by edit, I found another of his claims to be false: that income wasn't defined. Furthermore, his use of the Stanton v. Baltic Mining Co. case was refuted on the wiki article provided by Subbie.
His argument, essentially, falls flat on its face.
Cheers.

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BMG
Member (Idle past 209 days)
Posts: 357
From: Southwestern U.S.
Joined: 03-16-2006


Message 15 of 18 (456884)
02-20-2008 3:03 PM
Reply to: Message 13 by CK
02-19-2008 6:10 PM


Thanks, CK. I have read through it half-way, but must work out and then get ready for work. Perhaps I can finish it before I leave, or otherwise I will read it after work.
Thank you for the link.

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