“Treacherous Colossal Wreckage”

“All men are by nature equal, made all of the same earth by one workman.” ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ April 3, 2024 “Treacherous Colossal Wreckage” “All men are by nature equal, made all of the same earth by one workman.” – Plato [Special Reminder: In case you missed [our recent announcement]( The Essential Investor has merged with legacy contributors to Agora Financial. The new, larger, more inclusive project is called The Grey Swan Investment Fraternity. If you’re interested in the scope and benefits of our new endeavor, please see what prompted us to merge [here](. If you’ve been a member of The Essential Investor, please keep an eye out for your new benefits.] Dear [Reader], April 3, 2024 – Well, as you may be aware, the collapse of Francis Scott Key Bridge devolved quickly into a political spat over DEI. “Baltimore Bridge Collapse Creates More DEI Attacks,” observes Forbes. “Is DEI a Racial Slur? Rise in Term Outrages Black Americans,”Newsweek asks. “Racists called Baltimore Mayor Brandon Scott a ‘DEI mayor’,” decries the Baltimore Banner. “‘DEI mayor’ insults prove that unapologetic racism is back,” says the Washington Post. “Baltimore mayor says he’s ‘ignoring the noise’ of DEI blame for bridge collapse,” offers The Hill. The politics are sordid. But then, I repeat myself. Meanwhile, the local news is getting down and gritty on the details of how “treacherous colossal wreckage” will be cleared from the river. As well as local resident personal-interest stories on the longshoremen and their families who are out of work for the foreseeable future, and a trove of small businesses that relied on the port to stay open… one-rig truckers and mom-and-pop import/export outfits, for example. From a disconnected economics point of view, the extent to which the local Baltimore community is entwined with and dependent on global commerce is not anything new, but still fascinating to watch unfold. There are a lot of families living shipment-to-shipment within a few short miles of my own home. Makes me wonder how the drug dealers are making out… Hmm… We digress.  After a few short days off from computer screens and social media, we recall our current mission, renewed and invigorated… back to trying to untangle the colossal wreckage following the collapse of our once independent Republic. ~ Addison [What follows is an excerpt, apropos for readers who pay Federal taxes, from our book [Empire of Debt: We Came, We Saw, We Borrowed]( now available for pre-order at[Amazon]( and[Barnes & Noble]( or wherever you buy your books.] CONTINUED BELOW... >>ADVERTISEMENT<< [BREAKING: Major Stock Price Upgrade to $280!]( Source: [Wikimedia Commons]( Thanks to a HUGE blunder by Vladimir Putin... Wall Street analysts say one unique energy stock is on track to soar from $30 to $280. [Check out the unusual situation right here.]( CONTINUED... The Revolution of 1913 Readers today will scarcely have given any thought to the fact that they have never lived in the system of government argued for by Madison, Jay, and Hamilton in The Federalist Papers. “It may come as a shock,” wrote John Flynn, “to be told that [you] have never experienced that kind of society which [our] ancestors knew as the American Republic.” Flynn, the editor of the popular weekly, TheSaturday Evening Post, had already come to this conclusion in 1955. In his book The Decline of the American Republic, Flynn observed that Americans needlessly “live in the war-torn, debt-ridden, tax-harried wreckage of a once imposing edifice of the free society which arose out of the American Revolution on the foundation of the U.S. Constitution.” An empire needs a source of income sufficient to fund its military campaigns, regulatory regimes, and domestic schemes. It also needs a strong central authority to direct its ambitious new programs. In one short 12-month span, a year the writer Frank Chodorov calls the “Revolution of 1913,” the empire got the tools it needed. That year—the same year European countries abandoned the gold standard in preparation for World War I—the old Republic ceased to exist. America’s current system of income tax is a 20th-century invention. Previous attempts at creating a national tax had failed or had been thrown out because they violated tenets of the Constitution deemed essential by the founders. The First 100 Years In its first 100 years, the United States supported its federal government with a series of what we would today call “sin taxes” on whiskey, tobacco, and sugar. By 1817, all internal taxes were abolished by Congress, leaving only tariffs on imported goods as a means for supporting the government. The first income tax that citizens of the young Republic were forced to endure came about because Congress had been asked to fund the War Between the States. In 1862, a tax on incomes between $600 and $10,000 was assessed at the rate of 3%, and the Internal Revenue Service (IRS) was created. The war was costing $1.75 million per day. The government sold off land, borrowed heavily, enacted various fees, and increased excise taxes, but it simply wasn’t enough. The income tax seemed like the only way to finance the war and service the country’s then-staggering $505 million debt. That tax was promoted as a temporary wartime measure. Temporary it was. In 1872, after servicing the Reconstruction, Congress yanked the “temporary” tax. But that was not the end of it. The income tax appealed to empire builders because it alone offered enough cash to finance the enterprise. But it had another appeal—to the larceny and envy in the hearts of ordinary citizens. Following a banking panic in 1893, Senator William Peffer of Kansas supported the progressive income tax in this way: “Wealth is accumulated in New York, and not because those men are more industrious than we are, not because they are wiser and better, but because they trade, because they buy and sell, because they deal in usury, because they reap in what they have never earned, because they take in and live off what other men earn . . . . The West and the South have made you people rich.” That sentiment was puffed up by Nebraska’s bellicose world-improver William Jennings Bryan, who argued against the “equal taxation” requirement in the Constitution, in favor of the current progressive one: “If New York and Massachusetts pay more tax under this law than other states, it will be because they have more taxable incomes within their borders. And why should not those sections pay most which enjoy most?”4 This logic is simple. People who are more productive should be forced to pay a bigger share of their common expenses. But this kind of logic had no place in a free republic where all people were supposedly created equal; if they were equal they could each carry their own share of the burden of central government. Under this new regime, people were no longer equal, but given differing loads to carry based on the whims of elected hacks. A Corruption of Its People With considerable foresight, one member of the House of Representatives predicted: “The imposition of the [income] tax will corrupt the people. It will bring in its train the spy and the informer. It will necessitate a swarm of officials with inquisitorial powers. It will be a step toward centralization . . . . It breaks another canon of taxation in that it is expensive in its collection and cannot be fairly imposed . . . and, finally, it is contrary to the traditions and principles of republican government.” When the tax was again introduced in 1894, a challenge went to the US Supreme Court. In 1895, even among the cacophony of appeals in Congress to “soak the rich,” the Supreme Court declared the bill unconstitutional in a 5-to-4 ruling. In writing the majority opinion, Justice Stephen J. Field quoted another case to support his conclusion: “As stated by counsel: ‘There is no such thing in the theory of our national government as unlimited power of taxation in congress. There are limitations, as he justly observes, of its powers arising out of the essential nature of all free governments; there are reservations of individual rights, without which society could not exist, and which are respected by every government. The right of taxation is subject to these limitations.’” But when the winds of empire blew, the old yellowed paper of the US Constitution went flying. Following The Panic of 1907, President Theodore Roosevelt sided with a faction in the Democratic Party that wanted to amend the Constitution to allow a national income tax. In 1909, President Taft stated that he had “become convinced that a great majority of the people of this country are in favor of vesting the National Government with power to levy an income tax.” Of course, politicians are always able and willing to argue that “the people” want a government to have more power. If the voters see a free lunch in the deal, they’re for it. By 1913, just in time for Wilson’s emergence on the world stage, the Sixteenth Amendment had been ratified by enough states to put the income tax into law. The Amendment states: “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.” It wasn’t long before Congress exercised its new powers. Wilson even convened a special session of Congress to rush through the first tax law under the Sixteenth Amendment, in which earnings above $3,000 were subject to a 1% tax, gradually moving up to 7% on higher income levels. With its rather modest rates, the original income tax was viewed as a benign inconvenience. As early as 1916, however, the top rate was more than doubled from 7% up to 15%. Then as cash was needed to send Pershing to France, the rate was hiked to a staggering 67% in 1917 and 77% by 1918. Even the low rates were raised. From their microscopic origin of only 1%, the rate settled into a “modest” 23% by the end of World War II. But by that time, the people of the old republic had grown to accept an income tax as a necessary evil. Now that the nation was an empire, it needed the money. Oy. Our Present Era In our present era, the complexity of the Internal Revenue Code has created an army of specialized lawyers and accountants. Even attempts at reform are out of control. A “technical corrections” bill exceeds 900 pages of adjustments. In fact, by the beginning of the 21st century, the tax codes exceeded 7 million words, about nine times longer than the Bible; and the IRS was sending out about 8 billion pages of forms and instructions every year—at the cost of about 300,000 trees! In 2023, it has been estimated the average American spends 13 hours filling out annual tax forms. Multiplied by the number of known taxpayers in the nation (160 million), all this effort translates to about 2.1 trillion hours spent every year by individual Americans just complying with the tax rules. Our calculator strains trying to calculate the number. From 1913 to 2005, the income tax has enabled, entitled, empowered, and engorged the federal government, states, and local governments, private enterprises, and millions of private citizens. Spending has grown by more than 13,592%. In 2024 the government “guesstimate” they will spend another $9.46 trillion, up another 10% from the post-pandemic year 2023. The income tax gives the federal government a blank check to spend money, even money it does not yet have. The federal government lays a claim on all future economic activity of its citizens; its massive debts are a lien on the earnings of people who have not yet even drawn their first breaths. What’s more, the income tax could be used as both an economic tool and as a political weapon. Tax rates could be manipulated, for example, to punish or reward favored political groups. When the Constitution was ratified in 1789, the colonists in the New World believed they had won for themselves a measure of freedom and independence. “A republic, if you can keep it,” Benjamin Franklin warned. But by the end of 1913, a scant 124 years later, Americans were happy to lose their republic; an empire was what they wanted. So it goes, Addison Wiggin, The Wiggin Sessions P.S. “Cheap, nasty fun,” responded John B. over the weekend while we were refreshingly away, “reading all the reactions and Newtonian counteractions to the disaster in your backyard. “Much as I imagined, the subject of DEI entered the public mayhem as well. “Now you really have something to witness!” P.P.S.  We selected today’s excerpt as tax day approacheth. The story of what happens as the imperial winds billow throughout the 20th Century follows. You can read the whole dang tragedy in our book [Empire of Debt: We Came, We Saw, We Borrowed]( now available for pre-order at [Amazon]( and [Barnes & Noble](  or wherever you buy your books. [Empire of Debt]( somehow, made it to The New York Times best-seller list when we published the first edition back before the global financial crisis in 2008. Today’s edition brings us current to the colossal wreckage of a decade of Zero-Interest Rate Policy (ZIRP) and Quantitative Easing (QE), practically inexplicable government spending during the pandemic, and the lily-white political response to the generational inflation that ensued. As we did with the first edition, we’re going to mail a copy to each member of Congress and a box to the White House. Fortunately, our laws still require the knuckleheads to take receipt of mail sent to them by once proud, but lowly citizens. Do we expect a response? Hell, yeah. If the pattern holds, correspondence from staffers in the Canon building and the West Wing will be 98% of the fun – especially during an election year! Stay tuned. P.P.P.S. If you do buy a copy from [this]( or [this]( link, all the preorders will be recorded for posterity on May 2 when the book officially hits bookstore shelves. Give a social critic a hand… buy a copy and join the fight to save our [Empire of Debt.]( (Heh. We’re going to raise crowds with that stump speech, aren’t we…) Please send your comments, reactions, opprobrium, vitriol and praise to: addison@greyswanfraternity.com. The Daily Missive from The Wiggin Sessions is committed to protecting and respecting your privacy. We do not rent or share your email address. 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