Tax Protesting

It was suggested to me in a separate conversation that I am a tax protester who believes that paying any taxes at all is “not right.” I was surprised at this assertion.

I do not believe, and have never believed, that paying taxes is “not right.” I don’t think I’ve ever said that to anyone. There are various mechanisms of tax, from income tax to tariffs and such, and I think that the system should be changed. (So does the Left, and Obama –just in different ways. He is as much as “tax protester” as I am.)

The idea of a national income tax is relatively recent — our current system has been in place less than half of the history of the US — but there were various tariffs in existence before then and after. Some form of government is necessary and useful, and ours was a good design. And it must be supported somehow.

In fact, we’re back to taxing the poor.The income tax idea arose out of a need to augment the plan to punish people for drinking alcohol. Did you know that? Alcohol tariffs were a huge source of revenue for the US government — which is why the Internal Revenue Service was after Al Capone.

In fact, you might recall that the particular branch of the government who went after moonshine stills were called “revenoers” for that reason. (Remember “Snuffy Smith”?) My father remembered those Prohibition times well. The IRS didn’t spin off the separate Alcohol division until the 1970s.

Back to income tax: We had a very small income tax during the Civil War (5% max), which was hated and repealed shortly thereafter. But even while it was in force, the great majority of revenue came from taxes on alcohol and tobacco. In fact, from the IRS website’s history page:
http://www.irs.gov/irs/article/0,,id=101101,00.html

1867 – Heeding public opposition to the income tax, Congress cut the tax rate. From 1868 until 1913, 90 percent of all revenue came from taxes on liquor, beer, wine and tobacco.

It was repealed completely, shortly thereafter. And alcohol tariffs, the “tax on the poor,” were the US”s main (almost exclusive) revenue source again for roughly the next half century.

Then there was a problem: If they were successful putting through Prohibition (a project in which Progressives worked with the KKK), it would bankrupt the US. So, with an income tax, they could afford to cut out alcohol “for your own good.” Of course, people in power weren’t much affected by this. Nor were criminals and folks willing to break what they considered a stupid law, making them de facto criminals.

Later, the FDR government decided that they could actually collect both types of revenue, and Prohibition was repealed — a big payday for the government (including local governments) that remains to this day.

Note that after income tax was instituted (in which it was only a few percent, and applied only to the highest earners (about $450k plus in today’s dollars), it was quickly ramped down to $35k (again, today’s dollars) then to $20k then to $2k. And tax rates went from a max of 7% to a max of 67%. Under Wilson, the Democrat hero (who was the first President to express open disdain for the Constitution).

I don’t know if this sort of thing bores you or not. I am endlessly fascinated by history, including (and in particular) American history. The world has been full of Great Events! But in the US, we tried a Great Experiment, and it worked! We’re messing it up, and this is why I am concerned — I know our history moderately well, and other histories that form a rather stark comparison. The England of the Tudors and Stuarts has been endlessly romanticized, for example, but if you disagreed with certain folks — or the predominant religion — you had best keep quiet or risk a rather horrible torture or death.

And the predominant religion kept switching back and forth every few years or decades, just to keep things interesting. Catholics are in! No, Catholics must die! No, Catholics are okay, Protestants must die! No, now it’s … and so on. The entire nation switched back and forth, and each time they burned or racked a few hundred priests just to show they were serious. Then used it to go after anyone who came to official attention and had something someone wanted.

That is life under a totalitarian government, in this instance a monarchy. It’s not even religion, per se, as the communists did exactly the same thing but with Lenin/Trotsky/Stalin and so on. You’d better be loyal to the man of the moment! Saddam Hussein did the same thing — and made a gruesome home video of killing a bunch of people loyal to the wrong guy, which Hussein then used to get agreement from those who were left.

It’s funny — I typically write from memory, then have to go see if I can find some support for it, like the IRS story above. And many things have “rotted away” on the Internet, as if they were never there — producing a weird view of history for people who don’t remember it or didn’t previously dig into it and are just now looking at data. Obviously, if I find better (i.e., better researched, more current) information than what I have, I’ll go with that — but my memory has been pretty good.

===|==============/ Keith DeHavelle

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