Taxing the Rich is Unconstitutional

Wednesday was a busy day on Capitol Hill. In the President’s first press conference of his second four-year term, he made clear that tax hikes were still his primary method to cut the deficit and deal with the near-approaching fiscal cliff. In our view, raising taxes for the wealthy is essentially passing a death sentence on the economy. In addition to being destructive to our economy it is also unconstitutional.

The President also said he was open to new ideas: “With respect to the tax rates, I just want to emphasize I am open to new ideas. If Republican counterparts or some Democrats have a great idea for us to raise revenue, maintain progressivity, make sure the middle class isn’t getting hit, reduces our deficit, encourages growth, I’m not going to just slam the door in their face. I want to hear ideas from everybody.” (White House)

“We could go back into recession. It would be a bad thing,” (Financial Post) Obama said, referring to the scenario where the right and left fail to agree on the “fiscal cliff” solution by the January 1st deadline.

President Obama insists others join his campaign pledge to increase the burden on high-income earners while letting substantial tax deductions continue for the middle class.

With about seven weeks before January 1st, a compromise must be met or, major tax hikes on the wealthy will soon come into effect.

Lying and Stealing

“A modest tax increase on the wealthy is not going to break their backs,” President Obama said of the nation’s high income earners… “They’ll still be wealthy,”. (CBS News)

Taxing the wealthy because “they can afford it” is a lie because the government doesn’t know their circumstances.

Let’s look at “lying”. The assumption that “they can afford it” is in numerous cases, a lie, because many wealthy people can’t afford what others think they can. If you live in a high-cost area like New York, face college tuition bills for yourself and children, have your own debt to pay off, and provide for 5 kids who are still at home, you may not have as much “spare change” as the government presumes.

Even if a person has a million dollars relaxing in their dresser drawer, what gives the government the right to steal it?

“No state shall make or enforce any law, which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny any person within its jurisdiction the equal protection of the laws.” – 14th Amendment

Did you know that your money is actually your money? That it is your property? That you earned it, therefore, you are responsible for it. You have the responsibility and liberty to pay your bills, save money for your children, give to your church, give to charities, and do the other things you desire.

Giving to the Needy

The government’s responsibility is to protect, not provide. Helping people, giving, and sharing are wonderful and necessary. These privileges and duties are to be done through the Church and through individuals, not a government entity. I am not diminishing the severity of the needs but, the method to meet that need is wrong. Stealing from the rich is just as evil as stealing from the poor. Justifying the means by the end result is wrong. The question should not be “Will this method work?” the question should be “Is this method right?”. Increasing taxes for the the wealthy is not right. To be blunt, this method won’t work, even if it was right. The “share the wealth, tax the rich more” concept is a warning flag. It is a caution sign to Socialism which has an ultimate destination of Communism. This isn’t “doom and gloom” hype. This is the reality of evil that is presenting itself to the wonderful United States of America. Thousands have given their lives to protect the unparalleled and magnificent freedoms America enjoys today and many desire to take those freedoms away.

“The worker deserves his wages”. It isn’t the government that deserve the workers wages. Hard working Americans work to provide for themselves and their families, not the government’s self-inflicted needs.

My friends, please think of it this way. You own a farm. A big farm. You have 1,000 cattle on your farm. You’ve worked on this farm since you were 14 years old and have spent countless hours feeding your cattle, taking care of the lawn, milking cows, and dealing with vendors. Many days you have to miss dinner because of your long work hours and you hope you could have moretime to be with your wife and children. You have 1,000 cattle on your farm. The country in which you live has a large deficit because of wasteful spending and poor stewardship. There are also many people with less cattle than you. Therefore, the government wants your cattle. They need help fixing their problems and they don’t want your farm to get too much bigger than the other farms so, they pass a law saying they can take 40% of your cattle. I know this sounds ridiculous, immoral, unethical, and a little far fetched but, what is the difference? Maybe we have heard the term “raising taxes” so many times that our ears and hearts are numb to the subject but, this is what is happening. When you legalize theft for your party’s benefit, there is a problem.

Who are the rich?

Taxing the rich… who is the rich? Is it individuals who earn more than $200,000/year? Is it families that earn more than $250,000/year?
Taxing those with more money than others, blaming them and their corporations for America’s problems, is an immature response to the current economic crises.Let’s take a few steps back and consider this. Isn’t every American rich? Even if you don’t have enough for that new BMW, aren’t you rich? I’ve had the privilege of being overseas a few times, and I can tell you, we are a “rich” nation.

What is the logic behind not increasing taxes?

Who owns the businesses of America? The wealthy.

Therefore, who provides jobs? The wealthy.

If the wealthy are required to pay more in taxes, decreasing their yearly net revenue, they will have less money to hire employees.

Not only will their hands be bound when it comes to hiring but, they will have to let some employees go too. The unemployment rate recently found itself below 8%. It cannot stay there for long if the wealthy are taxed more. Unemployment could easily be up to 10% within a few years . More people could be out of work which means, more people would be collected unemployment, which means the government’s net revenue would be decreasing. Not to mention more people on welfare, resulting in the government paying more money. If this happens, will they tax the rich more and add fuel to this disaster cycle?

When we hear something on the media, it is easy to receive it as fact and ignore common sense. Let’s apply common sense and think about what we hear before we agree with it.

An underlying purpose in government increasing the wealthy’s taxes can be government control. If the government taxes the wealthy more, they are pushing down business and exalting government. With more tax dollars, government can become a big sugar daddy who gives everybody what they want, including “Obama Phones” (free cell phones). Many ignorant people then may fall in love with the government’s “kindness” which is actually a pathway to bondage, socialism, and eventually communism, unless it is stopped. The government’s God given responsibility is not to provide for people, it is to protect people. We need government, we need laws, we need jails, but we do not need a sugar daddy institution that gives us whatever we want; food, cell phones, houses, give me a break. Obama said this in August, 2012: “Do we go forward towards a new vision of an America in which prosperity is shared, or do we go backward to the same policies that got us into this mess in the first place?” (White House). If we would be wise enough to take a look at history and see what propelled America to greatness, we would see that one main factor was the limited government. The reason America was established was to be free from the government of England and their religious constraints.

What is the solution?

Is it necessary to raise taxes? Honestly, all bias aside.

In the realm of finances, an important principle to understand and practice is “Measure vs. Management”. How much money someone makes, usually doesn’t make or break them. It is how they handle that money. Their measure of income is less important than their management of that income. That is why up to 80% of lottery winners in America file bankruptcy within five years.

With printing presses available to them, I don’t think that the “measure” is the problem. It is the “management” of that measure of income that is the real issue.

Spending cuts are a non-negotiable. We absolutely need to implement spending cuts. It is possible that spending cuts alone could solve our problem. I say this because of research on wasteful government spending.

Let’s just throw a few more billion per/month into QE3 and use that money? The Fed is already talking about adding to it it’s Quantitative Easing initiative according to Wednesday’s FOMC Minutes statements.

I say the last statement sarcastically since QE3, in a broad view, is likely to hurt not help the U.S. Economy.

One example of wasteful spending can be found in Senator Tom Coburn’s report on wasteful spending in the Pentagon. His report identifies at least $67.9 billion of potential savings in the Department t of Defense, over the next decade.

Visit this link for more examples of wasteful spending, supporting the point that we do not need tax hikes. You’ll find everything from an Indian TV show to cupcakes and a robotic squirrel.

Fiscal Cliff, fast approaching

If we don’t understand what is happening in our country and it’s economy, we are destined to lose everything we have, all we have worked for for the past 200+ years. “People perish for lack of knowledge.”

January 1st, 2013 will be a pivotal day for the future of the U.S. Economy. The negative effects of the upcoming fiscal cliff could be felt by our children, grandchildren, and great grandchildren in the decades to come.

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  • andrew

    If ‘individuals’ who worked to make every dime they own were the true pool of wealth, I’d agree with you. But thats not true. Corporations are NOT individuals even though the law pretends they are. Also monoplies are not conducive to capitalist philosophy. And lets not forget that the ‘working’ poor (which are the vast majority of the poor) also pay taxes. And the tax dollars they have to give up to the government can often mean something as essential as food on the table for their kids. Again, if there really was a level playing field I’d agree with you 100%. But the field is tilted – and its NOT in favour of the average hard-working american.

  • Yes Michael it is owned by many people that own stocks. These stocks produce great income for many people. Yes some companies hire overseas to get labor costs reduced. You are correct on both counts.

  • Ian, thanks for your comments and historical facts, very interesting.

  • Michael M

    Isn’t Walmart a company owned by many on the Stock Market ? In fact aren’t a lot of employment providing businesses traded on the StockMarket .Anyone can own those stocks if they so desire . What about those unpatriotic companies that don’t employ Americans because Chinese labour is so much cheaper .

  • John,

    Yes the rich benefit from roads, military etc…. Yes they do. But so do the poor….. So why should the rich be required to pay 100% of the burden rather than have everyone pay an equal share.

    Lets agree the rich are smarter, that still does not make it right to make them carry all of the burden because by crushing the rich you are crushing the poor because the rich will not be able to provide jobs as easily.

    Where are the jobs the rich provide, well let me see. Walmart one of our biggest corpoarations provides 2.2 million jobs.

    When you say the rich don’t pay their fair share, were you aware that over half of the people dont pay federal tax? If that is the case who is paying the taxes. Oh yea, the rich.

    So that means they are paying their fair share they are paying all of it.

    I think it is time the poor pay there part at least become valuable participating members of society.

  • Pang Loss,

    Scandinavia economies are very successful but they don’t even come close to the success of the greatest financial successful country of all time: The USA.

    Thanks for your views In your theory that trickle down economics don’t work? What do you mean by that? Do you mean that when companies thrive like Walmart people don’t get blessed by that? I mean Walmart provides 2.2 million jobs. Based on that Trickle Down economics works. Successful business means jobs for the people and when Governments limit those jobs, it hurts the people.

  • Ian D Edwards

    Tax isn’t a single thing. Traditionally it was on imports/exports to raise money for modest government, then on company profit, then on income, and now on any money that is circulated. Tax is either discretionary or non discretionary – if the former you can choose not to buy and avoid tax; with non discretionary its just taken off you whether you like it or not. The Mafia use this technique and then the government copied it with income tax since they both know you can’t choose not to have an income. Pretty smart huh? The income tax (tax on your labour) did not exist at the time of the US constitution and was brought in I believe to pay for WWI and they forgot to turn it off afterwards. The UK (my gaf) used the same trick saying income tax was just to fight Bonaparte in the Napoleonic Wars and they too forgot to reverse it after Waterloo. Here we work January to around April/May working for the State and then the rest of the year we are permitted to work for ourselves. I know using analogies to cattle are a bit biblical and references to the constitution (what the head of state, be it monarch or president, is supposed to protect with his or her life) get up modern thinkers noses yet they totally illustrate the point. Tony, you’re damn right to be thinking about the way modern governments promise the earth (out lies the others to get elected) then under delivers (it wasn’t my fault, give me another chance) ignores the unbalanced budget (we can’t go broke because we control money) this is the land of the free (pay your tax or else) and the land of opportunity (so we can plunder your pockets even bigger when you make it than we did when you were poor) – all in our name, maybe that’s why so few vote. It’s a strange place this modern society. I wonder if anyone who will criticise me for penning this note pays out of the goodness of their heart a percentage of their annual forex earnings to the Government to spend in their name? No, let me spend the money I make back into the economy myself, I can do a better job, and for less cost that a government bureaucrat can do it. Then everyone (except a few bureaucrats) gets the benefit.

  • John

    Well don’t know whether to laugh or cry. This is the type of logic that got the United States into trouble in the first place and quite frankly demonstrates an unbelievable lack of intelligence. Do the rich not benefit from government investments or spending such as better roads or military protection?

    Perhaps we could agree about a couple of assumptions. First of all, the rich are usually rich because they conduct themselves a little bit smarter than the poor or not so poor (middle class). True? So if they are taxed more would they not be smart enough to make more money? I would bet my whole forex life on this premise. But then they would have to convince me that there ponzi schemes actually benefit the middle class. By the way, have you noticed that over the last few years the rich have gotten richer and the poor have gotten poorer OR to put it in terms of failed leadership where are all the jobs the rich provide? I would say this is an unprecedented example of a system that is failing. It needs to be changed.

    The rich have never paid their share in the United States and it is long overdue for them to start. However, one way to ensure this is to ask the United States to address their huge debt. It is totally unconscionable that the ponzi scheme which the wealthy have benefitted from continue.

  • I agree with your first point “We are the Gov. We hold ourselves accountable and we make the choice by who is elected. To that end, we get to change Gov when it no longer suits We the People.”

    That is actually how our constitution was written the Government was changed by the people.

  • NathanTucci

    You are right and I love what you said about “spend if there is left over, not save if there is left over” Great Feedback! Thanks for chiming in Fabrice!

  • Bush, didn’t create the constitution, the Constitution was created in 1787. . The point is that the constitution says that unfair taxation is wrong. That is the entire point of this article.

  • pangloss

    I disagree with the article. Your view is “social darwinism” in the extreme (who you probably don’t understand anyway – given your christian fundamentalist views). The most successful societies are scandinavian and they have very high taxes and they still have innovation. The Bush era created the mess the U.S. is now in. Trickle-down economics doesn’t t work.

  • Actually I disagree with the article.

    We are the Gov. We hold ourselves accountable and we make the choice by who is elected. To that end, we get to change Gov when it no longer suits We the People.

    It’s a fools errand to get into the weeds of why the Church as you say should be the social safety net. Suffice it to say, the Church if flawed. So is Gov. but someone should step in to assist people when they don’t have the means to assist themselves or the circumstances are too great for any one person to fix. Exhibit A: Sandy. Exhibit B Public Schooling.

    As to the argument of high wage earners and returning to Clinton era rates. Umm, it’s your choice to live where you do, thus it’s your choice to change it. Low taxes didn’t stop business from sending US jobs oversees. So since people can clearly make choices, make the choice to move to cheaper locations with lower cost of living than a mega city.

    You know a little bit of math. I’m sure that if you cut taxes, then go into 2 major wars, pass out a Gov check to big Pharma (Medicare part D) and grow DoD’s budget. How have you paid for everything?

    Taxes aren’t stealing. Since there’s waste in Gov then by all means fix it. But don’t oversimplify an issue that was long before Barack Obama and will be long after. Instead since the middle class has had to take it on the chin, it’s time for the wealthy to as well, seems to me they’ve had a very good run of things. Time for the trend to head down and for there to be a balance.

    God sits above all of this and for that I’m glad. Let Him decide because His view is WAY better than mine.

    I’m not too arrogant to think that I have all the answers.

    God was before the USA. He’ll be after.

  • Fabrice Goeyvaerts

    Excellent article, Tony ! I like the way you analyse the situation and completely agree with this statement: “The government’s responsibility is to protect, not provide”.
    If each and every one would first SAVE money and then spend if there is left instead of SPENDING first and then save if there is left, government’s could only focus on protection … but how many on this planet are ready to make sacrifices in order to slowly but surely become wealthy ??? Very, very few and of course those people unable to manage their own money are always the ones who complain and are jealous of the “rich” ! And so like you say Government’s steal money from those rich and “poors” applaude … miserable !

  • Tony Great Article, I think that maybe you should run for President next term!!!!

    I agree with you 100%

    Good job.