the holistic radical

March 20, 2008

Are US Taxes Legal?

Ron Paul is the only candidate standing up to this. Watch “America: Freedom to Fascism.” Go to restoretherepublic.com. Learn about the Federal Reserve and how our tax dollars are feeding the bankers.

——-

http://www.naturalnews.com/z022856.html

NaturalNews.com printable article

Originally published March 18 2008

Americans Question the Legality of the Income Tax

by Barbara L. Minton (see all articles by this author)

(NaturalNews) There’s nothing that gets me all tingly like the coming of spring. It’s always been my favorite time of the year. Just one problem stands between me and total rapture – the need to complete a tax return and file it along with the money I always owe. This year the filing of the tax return feels particularly odious, because this year is when I began to find out that there is no law that actually requires me to file a return, and no law that actually requires me to pay tax on what I earn.

It all began when I saw the feature film/documentary, America: Freedom to Fascism directed by six time academy award nominee Aaron Russo, a self-described freedom fighter. The troublesome central point of this film is that Americans are not required by law to pay a federal income tax. It is overwhelming to think that such a fraud as this could have been perpetuated on the American people for so long. In the film, Russo expresses this feeling to IRS employees and simply asks them to cite where it says an unapportioned income tax is required of all of us. And incredibly, they can’t.

One telling segment involves Sheldon Cohen, former IRS commissioner, who goes so far as to reject Supreme Court rulings and the Constitution as benchmarks over what is legal with regard to taxation. The film also includes interviews with members of the Tax Honesty Movement as well as former IRS agents who concur that there is no law on the books that requires any US citizen to send the government part of his hard earned paycheck. Russo also highlights court cases where those accused of tax evasion have won their cases precisely because the prosecution could not provide evidence of a legal federal income tax law.

The film hammers you again and again with endless examples of people who figured out what was up and have not paid taxes for years. By the time it’s over, you feel like a big fool who has thrown money away year after year for nothing.

Since feeling foolish doesn’t do much for my ego, I got online to see for myself that there really is a law the says I have to pay income tax. Here’s what I found.

The Case of Joe Banister

On June 23, 2005, a federal jury found former IRS Criminal Division Special Agent and CPA Joseph Banister not guilty of all counts of criminal tax fraud and conspiracy related to actions he took on behalf of a California business owner who had openly defied the IRS over several years by discontinuing withholding of income and employment taxes from the paychecks of his employees.

The Department of Justice was unable to present any evidence that Banister had either acted in a conspiracy or had acted unlawfully when he advised Thompson that based on findings from his legal research, he had no obligation to withhold taxes from his employees. The Justice Department also concluded that when Banister filed corrected tax returns for Thompson claiming that Thompson’s taxable income was zero, rather than the $42,251 he had claimed on his first filing, he was operating within the framework of the law.

Banister, who was forced to resign from the IRS in 1999 after questioning IRS officials about their legal authority, gave Thompson’s employees a presentation in 2000 detaining his investigative research of US tax law. Findings were that not only did the IRS lack any authority to impose income taxes on workers, but there was no legal requirement for the business to withhold any taxes from the employee’s paychecks.

Banister is reportedly part of a nationwide effort seeking to force the US government to respond to a series of detailed legal Petitions for Redress of Grievances directly challenging the authority of the IRS. The We The People Foundation has initiated a landmark lawsuit with 2000 plaintiffs against the government because it has refused to answer the Petitions. This Right-To-Petition lawsuit, of which Banister is a plaintiff, is the first time in the history of the US that the courts have been asked to define the meaning of the final ten words of the First Amendment.

Conclusions of the We The People Foundation

The website of the We The People Foundation begins with the premise that there is no law that requires most citizens to file and pay federal income taxes. They summarize the key steps of their argument:

There is a federal law that imposes a requirement upon some citizens and foreigners to file and pay an income tax. The question is, to what proportion of citizens does the requirement apply? We The People answers that question with an examination of statutes and regulations, despite the lack of direction supplied by the IRS.

They conclude that “no tax liability applies to the vast majority of citizens, who have been misled into believing they must file and pay income taxes noted in section 61, the section that calls for determination of “gross income”. Instead, tax liability applies to US citizens only insofar as they have foreign earned income. This tax liability also applies to aliens and foreign companies doing business in the US. In fact, the Secretary of the Treasury acknowledged that Form 255 was the form most frequently required to be filed by citizens, and only if they had foreign income.

They elaborate, “We can see that the government, by means of such a circuitous and disconnected trail of rules and regulations, has made it extremely difficult for most ordinary people to figure out that they are not liable for the income tax. We can see that the government is duping most people into voluntarily filing returns, assessing themselves, waiving their 5th amendment rights, and erroneously paying an income tax for which they are not liable.” They note that statutes and regulations for other taxes are clearly stated, without ambiguity, concluding that “This trickery and deception serves a function of avoiding violations of the Constitution which would be more transparent otherwise.”

Additionally, they conclude that “employers are being duped into submitting false information about most employees, withholding their money, making it appear they are liable, and thereby putting them on the defensive, since they must then dispute that their wages are taxable.”

Finally, a look at the laws regarding liability for the Social Security tax reveals that they are derived from the International Labor Agreement of the 1930s and do not apply to most US citizens, but to aliens and to some citizens based on foreign income or income from US overseas possessions.

And Then There’s Irwin Schiff

Irwin Schiff is billed as the nation’s leading authority on income tax and how the government illegally collects it. He is the motivating factor of the Tax Honest Movement, and claims to have written more books on the subject than any other American. His most recent book The Federal Mafia promises to show you how you can immediately stop having income taxes taken from your pay, get back every dime you paid in income taxes this year, stop IRS agents from seizing your property because they have no power to do so, and break “offer and compromise” agreements you might have made with the IRS, since these agreements were entered into on the basis of fraud and intimidation.

Among the arguments raised by Schiff are: (1) that no statutory deficiency in Federal income tax can exist until an assessment has been made (2) that no tax assessment can be made unless a tax return has been voluntarily filed (3) that the IRS, in enforcing the income tax seeks to impose a tax not authorized by the taxing clauses of the US Constitution (4) that the US has no jurisdiction, and (5) that the US Tax Court is not a court.

Another argument made by Schiff is that on the Form 1040, you should report ‘zero’ income regardless of how much you received in: wages, commissions, interest, alimony, capital gains or from operating a business. For tax purposes, ‘income’ only means corporate ‘profit’. Therefore, no individual receives anything that is reportable as ‘income’. This argument has been rejected by the lower courts, as well as the US court of appeals.

What Schiff is seeking to accomplish will not be accomplished easily. In the 1970’s, Schiff made an appearance on The Tomorrow Show where he argued his views on federal income tax. This appearance was followed six days later by his being charged for willful failure to file tax returns, for which he was convicted. During the 1980’s and 90’s additional convictions were obtained and upheld, proving that what Schiff is seeking to do will not be done easily.

In February, 2006, at the age of 78 years, Schiff was sentenced to 12 years, 7 months in prison and was ordered to pay over $4.2 million in restitution to the IRS. He was also sentenced to an additional 12 months for contempt of court.

About the author

Barbara is a school psychologist, a published author in the area of personal finance, a breast cancer survivor using “alternative” treatments, a born existentialist, and a student of nature and all things natural.
 

March 12, 2008

How do you spell “Recession”? D-I-S-C-O-N-T-E-N-T

and P-O-V-E-R-T-Y.

from truthout.

http://www.truthout.org/docs_2006/013108B.shtml

America’s Middle Classes Are No Longer Coping
By Robert Reich
The Financial Times

Tuesday 29 January 2008

It is an election year and the US economy is in peril of falling into recession or worse. Not surprisingly, Washington is abuzz with plans to prevent it. President George W. Bush has proposed a $150bn stimulus package and all the main presidential candidates are offering similar measures, including middle-class tax cuts and increased spending on infrastructure.

Ben Bernanke and the Federal Reserve have reduced interest rates another three-quarters of a point. But none of these fixes will help much because they do not deal with the underlying anxieties now gripping American voters. The problem lies deeper than the current slowdown and transcends the business cycle.

The fact is, middle-class families have exhausted the coping mechanisms they have used for more than three decades to get by on median wages that are barely higher than they were in 1970, adjusted for inflation. Male wages today are in fact lower than they were then: the income of a young man in his 30s is now 12 per cent below that of a man his age three decades ago. Yet for years now, America’s middle class has lived beyond its pay cheque. Middle-class lifestyles have flourished even though median wages have barely budged. That is ending and Americans are beginning to feel the consequences.

The first coping mechanism was moving more women into paid work. The percentage of American working mothers with school-age children has almost doubled since 1970 – from 38 per cent to close to 70 per cent. Some parents are now even doing 24-hour shifts, one on child duty while the other works. These families are known as Dins: double income, no sex.

But we reached the limit to how many mothers could maintain paying jobs. What to do? We turned to a second coping mechanism. When families could not paddle any harder, they started paddling longer. The typical American now works two weeks more each year than 30 years ago. Compared with any other advanced nation we are veritable workaholics, putting in 350 more hours a year than the average European, more even than the notoriously industrious Japanese.

But there is also a limit to how long we can work. As the tide of economic necessity continued to rise, we turned to the third coping mechanism. We began to borrow, big time. With housing prices rising briskly through the 1990s and even faster between 2002 and 2006, we turned our homes into piggy banks through home equity loans. Americans got nearly $250bn worth of home equity every quarter in second mortgages and refinancings. That is nearly 10 per cent of disposable income. With credit cards raining down like manna, we bought plasma television sets, new appliances, vacations.

With dollars artificially high because foreigners continued to hold them even as the nation sank deeper into debt, we summoned inexpensive goods and services from the rest of the world.

But this final coping mechanism can no longer keep us going, either. The era of easy money is over. With the bursting of the housing bubble, home equity is drying up. As Moody’s reported recently, defaults on home equity loans have surged to the highest level this decade. Car and credit card debt is next. Personal bankruptcies rose 48 per cent in first half of 2007, probably even more in the second half, which means a wave of defaults on consumer loans. Meanwhile, as foreigners begin shifting out of dollars, we will no longer have access to cheap foreign goods and services.

In short, the anxiety gripping the middle class is not simply a product of the current economic slowdown. The underlying problem began around 1970. Any presidential candidate seeking to address it will have to think bigger than bailing out lenders and borrowers, or stimulating the economy with tax cuts and spending increases.

Most Americans are still not prospering in the high-technology, global economy that emerged three decades ago. Almost all the benefits of economic growth since then have gone to a small number of people at the very top.

The candidate who acknowledges this and comes up with ways not just to stimulate the economy but also to boost wages – through, say, a more progressive tax, stronger unions and, over the longer term, better schools for children from lower-income families and better access to higher education – will have a good chance of winning over America’s large, and increasingly anxious, voters.

———

The writer is professor of public policy at the University of California at Berkeley. He is former US secretary of labour and author of Supercapitalism


    Go to Original

Pro-Business Bias Survives Economic Bust
By Max J. Castro
Progresso Weekly

31 January to 05 February 2008 Issue

Boasting about the strength of the economy has been a staple of Bush administration propaganda for a long time. In fact, while the rate of economic growth and the level of unemployment have been pretty good for the last few years, throughout the Bush era the economy has been “strong and getting stronger” only for those at the very top of the income distribution.

It is a trend that began long before George W. Bush became president but which has been aggravated by his policies. Since 1973 and especially in the last ten years, those in the top one-tenth of one percent of income earners have done spectacularly well. Those in the top one percent of the income ladder have done very well, and those merely in the top ten percent have made much less impressive but real gains in income. In contrast, and in spite of vast economic growth, between 1973 and 2005 everybody else, the remaining 90 percent of the population, experienced a significant drop in real income!

The current administration’s policies of giving huge tax breaks to the very rich, restricting government spending on middle class and low income programs, and giving business a free hand in every sphere have been a major factor in bringing about the obscene levels of inequality in existence today. But these policies have done more than just deepen inequality. By undermining regulation and oversight, these policies have led to many corrupt and irresponsible business practices, with results such as the Enron scandal and the current sub-prime lending crisis.

The regulatory mechanisms that emerged in the wake of the 1929 Wall Street crash and the Depression of the 1930s were not the product of a socialist conspiracy or anti-business ideology. They were lifesaving devices for the capitalist system and the American economy.

The administrations that have run the country for the last three decades seemed to have forgotten this and, in a frenzy of free market faith that has been particularly intense during Republican rule but has also been present during Democratic presidents, have poked huge holes not only in the social safety but also in the economic and financial safety net.

Now the myth of a perfectly self-regulating market has burst, starting with the housing market crisis and spreading through the economy. Many analysts are predicting a recession. The Federal Reserve Board, which usually acts with caution, was so alarmed as to carry out a record decrease in interest rates in order to boost the economy and prop up sinking stock market prices. The administration acted too, but as usual it saw the drama of millions of Americans in danger of losing their houses and their jobs as first and foremost an opportunity to further its ideological agenda in line with the interests of corporations and the very rich. The Democrats in Congress pushed a different set of policies to ward off recession, but in the end once more largely caved in to Congressional Republicans and the administration.

Democrats in Congress wanted to increase food stamps and extend unemployment benefits, measures that would have helped those hurt worst by an economic downturn but also the groups most likely to spend any additional income quickly, exactly what is needed to give the economy a quick boost.

Republicans were adamant against this approach. The GOP’s priority was to continue and expand tax cuts for business and the rich. The Republican argument is that this will stimulate the economy by encouraging investment.

Despite controlling Congress, the Democrats ultimately gave in on almost every issue except making the 2001 Bush tax cut permanent, which the Republicans dropped. The compromise that was approved by the House of Representatives and Speaker Nancy Pelosi does not include increased funds for food stamps or unemployment benefits. It does include new tax breaks for business investment. Pelosi did manage to obtain some payments for those too poor to pay taxes and to reduce tax rebates for households with higher incomes.

Despite these small Democratic wins, the irony is that a program intended to provide relief for a looming crisis caused to a significant degree by policies wildly biased in favor of business is itself rife with some of the same biases.

An economy in which income is increasingly concentrated in fewer and fewer hands and that withholds its rewards from the vast majority of the population even in the best of times is not sustainable politically, socially, economically, or morally. The lesson of the compromise economic stimulus package is that neither Republicans nor Democrats are ready to confront this reality.

GNP not an indicator of reality–more proof economics is elitist code/lingo–fight for progress

from truthout:

Our Three-Decade Recession
By Robert Costanza
The Los Angeles Times

    Monday 10 March 2008

The American quality of life has been going downhill since 1975.

    The news media and the government are fixated on the fact that the U.S. economy may be headed into a recession – defined as two or more successive quarters of declining gross domestic product. The situation is actually much worse. By some measures of economic performance, the United States has been in a recession since 1975 – a recession in quality of life, or well-being.

    How can this be? One first needs to understand what GDP measures to see why it is not an appropriate gauge of our national well-being.

    GDP measures the total market value of all goods and services produced in a country in a given period. But it includes only those goods and services traded for money. It also adds everything together, without discerning desirable, well-being-enhancing economic activity from undesirable, well-being-reducing activity. An oil spill, for example, increases GDP because someone has to clean it up, but it obviously detracts from well-being. More crime, more sickness, more war, more pollution, more fires, storms and pestilence are all potentially positives for the GDP because they can spur an increase in economic activity.

    GDP also ignores activity that may enhance well-being but is outside the market. The unpaid work of parents caring for their children at home doesn’t show up in GDP, but if they decide to work outside the home and pay for child care, GDP suddenly increases. And even though $1 in income means a lot more to the poor than to the rich, GDP takes no account of income distribution.

    In short, GDP was never intended to be a measure of citizens’ welfare – and it functions poorly as such. Yet it is used as a surrogate appraisal of national well-being in far too many circumstances.

    The shortcomings of GDP are well known, and several researchers have proposed alternatives that address them, including William Nordhaus’ and James Tobin’s Measure of Economic Welfare, developed in 1972; Herman Daly’s and John Cobb’s Index of Sustainable Economic Welfare, developed in 1989; and the Redefining Progress think tank’s more recent variation, the Genuine Progress Indicator. Although these alternatives – which, like GDP, are measured in monetary terms – are not perfect and need more research and refinement, they are much better approximations to a measure of true national well-being.

    The formula for calculating GPI, for instance, starts with personal consumption expenditures, a major component of GDP, but makes several crucial adjustments. First, it accounts for income distribution. It then adds positive contributions that GDP ignores, such as the value of household and volunteer work. Finally, it subtracts things that are well-being-reducing, such as the loss of leisure time and the costs of crime, commuting and pollution.

    While the U.S. GDP has steadily increased since 1950 (with the occasional recession), GPI peaked about 1975 and has been relatively flat or declining ever since. That’s consistent with life-satisfaction surveys, which also show flat or dropping scores over the last several decades.

    This is a very different picture of the economy from the one we normally read about, and it requires different policy responses. We are now in a period of what Daly – a former World Bank economist now at the University of Maryland – has called “uneconomic growth,” in which further growth in economic activity (that is, GDP) is actually reducing national well-being.

    How can we get out of this 33-year downturn in quality of life? Several policies have been suggested that might be thought of as a national quality-of-life stimulus package.

    To start, the U.S. needs to make national well-being – not increased GDP – its primary policy goal, funding efforts to better measure and report it. There’s already been some movement in this direction around the world. Bhutan, for example, recently made “gross national happiness” its explicit policy goal. Canada is developing an Index of Well-being, and the Australian Treasury considers increasing “real well-being,” rather than mere GDP, its primary goal.

    Once Americans’ well-being becomes the basis for measuring our success, other reforms should follow. We should tax bads (carbon emissions, depletion of natural resources) rather than goods (labor, savings, investment). We should recognize the negative effects of growing income disparities and take steps to address them.

    International trade also will have to be reformed so that environmental protection, labor rights and democratic self-determination are not subjugated to the blind pursuit of increased GDP.

    But the most important step may be the first one: Recognizing that the U.S. is mired in a 33-year-old quality-of-life recession and that our continued national focus on growing GDP is blinding us to the way out.

    ——–

    Robert Costanza is the director of the Gund Institute for Ecological Economics at the University of Vermont.

Blog at WordPress.com.