Ed wrote:
> I'm not wealthy. I need the social security benefits I have earned. I don't
> mind paying a FAIR share of taxes based on my income, my ability, to pay. It
> bothers me that others, the wealthy, can simply 'opt out' while sucking
> wealth, our commonwealth, from our economy, by the hidden taxes, the
> increased burden, on the rest of us who live in this land.
RESPONSE:
I see that you have fallen into the "FAIR share" thinking trap.
Your argument is obvious: No one should take advantage of anyone else. Each
contributes and withdraws according to his contribution. I don't question that
it sounds good. The problem is that you have not perceived the basic design of
the American system of government. But, don't feel bad about that. 99.99% of
all persons have missed it.
There are many different ways to structure a society. The "fair share" concept
is a very attractive-sounding and democratic one. The founders of this country
considered and reject it. Instead, they selected a republican form of
government, and a business system to match. The problem they were trying to
solve was this: How can we have a government that is large enough to protect us
from outside forces, while at the same time keeping it from following the
tradition of growing in size to the point of consuming its own people? How
could they build into the system a natural limitation on the growth of
government? The solution lies in the political and economic system.
The essence of any economic system is creating and consuming. On the creative
side were agriculture and manufacturing. On the consuming side were the
people. Between the creators and consumors was a group which, though
non-productive, was still useful to society: the resellers. The resellers
bought wholesale from the creators, and sold retail to the consumers. The
difference in the buying and selling price was called profit or income. The
resellers engaged in what was called commerce. Commerce is essentially the
process excercised by the resellers. Commerce does not include agriculture,
manufacturing, or consumers. The Consitution authorizes Congress to regulate
interstate commerce. Regulation implies the power to tax. In other words,
Congress was not allowed to regulate non-commerce such as agriculture,
manufacturing, and consumers. This ingenious arrangement very neatly solved the
problem of limiting government which otherwise always grows until it consumes
its own people.
Here's a diagram:
GOVERNMENT ---->--- LABOR ------>-------
^ |
| |
(TAX) |
| |
| v
CREATORS <--- (WHOLESALE) <--- COMMERCIAL <--(PROFIT + TAX =) <--- CONSUMERS
Agriculture ( PRICE ) RESELLERS ( RETAIL PRICE ) ^
Manufacturing |
| |
-------------------> LABOR ------ (flow of money) ------------->-----
The CREATORS would sell to COMMERCIAL RESELLERS.
GOVERNMENT wouldD TAX (REGULATE) COMMERCIAL RESELLERS only.
COMMERCIAL RESELLERS would add their profit and tax to the wholesale price to
arrive at the retail price.
CONSUMERS would pay the retail price.
CREATORS complete the money loop by purchasing the LABOR of the CONSUMERS.
The circulation of the money system was stabilized by using gold and silver.
The neat thing about that stucture is this: If the retail price became too
high, the CONSUMERS could bypass the COMMERCIAL RESELLERS and buy directly from
the creators. That, of course, would limit the government's income. That
arrangement worked well for about 150 years. Wars were fought, and government
functioned.
The big problem, of course, was that government was feeling the strain of being
prevented from consuming its own people. SOMETHING had to be DONE! And
something was done.
Because of the high level of general education the government did not have the
strength to change the Constitution. So, they changed the education system
instead. Around 1850 the government introduced mandatory public schools. The
first mandatory public school was populated under military supervision over the
objections of the parents. From the 1850's to the 1950's the school curriculum
was gradually modified.
The subject of "Civics" (the study of personal rights) was phased out, and
"American Government" was phased in over a 100-year period. Also, the English
language was more loosely taught. Eventually the word "commerce" came to be
perceived by everyone as including any business involving money. By the
mid-20th century everyone believed that business and commerce were the same.
Little by little the government began reducing the tax paid by the resellers,
and began taxing the other elements. Now government could resume its
traditional growth toward self destruction. By taxing (and impoverishing)
everyone, the government gained enough power to overpower everyone. And why
not? People were taught the importance of everyone doing his "FAIR SHARE" in
supporting the government.
The natural limits were removed. The results can be seen today.
Notice that the money recirculates. In theory, it makes no difference where you
tap into the money loop. But, being very practical, the founders decided to
have the government place the tax tap at the point of COMMERCE. COMMERCE
resellers were our first line of defense against overtaxation. Our second line
of defense was the "go-around" and "buy direct" feature. Now that everyone is
"paying his fair share" (except the resellers who currently pay nearly nothing)
no one feels the pain sufficiently to force government to reduce the taxes. The
net result is the financial deterioration of the whole system. Converting to a
paper money credit system just aggravates the problem.
Make sense?
By the way, you said, "I need the social security benefits I have earned."
The courts have said the the money you pay is technically an income tax.
The money taken out is welfare.
Social Security is not insurance, and you did not earn it. You paid an income
tax, and you are granted the privilege of being eligible for welfare if your
old-age income is below a certain level. If your income is above some arbitrary
level, then, on a sliding scale, your welfare eligibility is reduced. If your
income is too high, then, obviously, you are not eligible for welfare support at
all.
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