How Did It Happen?

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Does anyone ever wonder how we got the income tax?  This tax has become so universal, on international, federal, state and even local levels, that it is taken for granted, but few people seem to question its legitimacy, history, or even its purpose.


An internet search suggests a form of “wealth tax” or income tax existed in the Roman Republic, ancient Egypt, and China, but the form we know, usually imposed to finance wars, began in England in 1188, by Henry II, for the “Saladin tithe” to fund the Third Crusade. 


In his landmark book, Wealth of Nations, in 1776, Adam Smith, a Scott, suggested even the King of Britain could not get away with an income tax.  Tax on interest or money is difficult to calculate without extraordinary “inquisition” into every man’s private circumstances and “would be a source of such continual and endless vexation as no people could support.”  However, a mere nine years after Smith died in 1790, British Prime Minister William Pitt the Younger formally implemented the income tax, designed to pay for the French Revolutionary War, to purchase weapons and equipment.  It was a progressive income tax and in place between 1799 and 1816, but for a short reprieve following the Peace of Amiens in 1803.  It was reintroduced in Great Britain in 1842 by Prime Minister Sir Robert Peel, who was seeking revenues for the government’s increasing budget deficits. 


“A heavy progressive or graduated income tax” is the second major tenet of the The Communist Manifesto, as delineated by Karl Marx and Friedrich Engels in 1848.  The fifth tenet advocated “Centralization of credit in the hands of the State by means of a national bank with State capital and an exclusive monopoly.”


In the United States, President Abraham Lincoln instituted the first US income tax in 1861 to pay debts from his war.  It was repealed by Congress in 1872.


The Socialist Labor Party pushed for an income tax in 1887.  The Populist Party demanded it in its 1892 platform, and the Democrats, led by William Jennings Bryan, advocated for the progressive income tax law passed in 1894.   Called the William-Gorman Tariff Act (Revenue Act), it reduced tariffs and imposed a two percent income tax but only on the top ten percent of earners.  In 1895, in Pollock v. Farmers Loan and Trust Co., the Supreme Court declared the tax unconstitutional, based on the constitutional requirements that taxation be apportioned by a state’s population.


Republican Rhode Island Senator Nelson W. Aldrich, who served between 1881 and 1911, was probably the single most influential individual in creating the financial structure we know today.  As chairman of the Senate Finance Committee--which oversaw bank regulation and monetary policy--he was possibly the most powerful man in the nation from 1898 to 1911. The Panic of 1907, (which some believe was engineered by banker and Aldrich friend/business associate, J. Pierpont Morgan) led to the Aldrich-Vreeland Act in 1908, which was designed to make the monetary supply more elastic.  It also established the National Monetary Commission with Aldrich becoming chairman.  As chairman, he led a team of “experts” to European capitals to study their banking practices, and returned as a proponent of a national banking system.  He worked in secret with powerful bankers to develop the “Aldrich Plan,” which eventually formed the basis of the Federal Reserve Act of 1913.  The secret dealings that began in 1910 and led to the creation of the Federal Reserve system is well documented in The Creature from Jekyll Island:  A Second Look at the Federal Reserve, by G. Edward Griffin.


Aldrich, who apparently had a habit of publicly opposing things he wanted, then voted in Congress for the corporate income tax in 1909, claiming this was to insure the personal income tax would not be passed.  Ten years before, he had called the income tax “communistic.”  However, later he and President William J. Taft then agreed that a constitutional amendment would be more effective in overriding the Supreme Court’s objections to the 1894 law.  Aldrich claimed he believed the 16th amendment would never be approved.


The relationship between the Federal Reserve System and the new income stream generated by the income tax is not well documented, but it resembles that of the Whiskey Tax and the nation’s first central bank in 1791.  At that time, Treasury Secretary Alexander Hamilton introduced legislation for the whiskey tax on December 13, 1790 and for the central bank the next day, on December 14, 1790. 


A common thread in the two bank/taxing schemes was that they gave the federal government the authority, if not the right, to investigate every taxpayer’s personal property and bank accounts searching for infractions, and to seize property it decides has been obtained illegally.  This has set the precedent for the federal invasion into private lives that has become so prevalent today.


In the “Gilded Age,” Nelson Aldrich was well known for his close and unsavory ties to business, by which he had become personally wealthy.  He believed his power base would successfully defeat the income tax amendment.  Indeed, while they were opposed, their solidarity had broken down, so individuals like Andrew Carnegie and John D. Rockefeller (whose son John Jr., married Aldrich’s daughter Abby) formed tax-exempt foundations to shelter their wealth before the tax went into effect. 


At that time the income tax was promoted as a “class tax,” with only the upper income earners affected, so the idea of wealth re-distribution appealed to lower income earners.  Only later did President Franklin D. Roosevelt expand the “class tax” to a “mass tax,” according to former IRS historian Shelley L. Davis in her book, Unbridled Power: Inside the Secret Culture of the IRS.


Proponents of the income tax used other arguments, too.  It was proposed as a more reliable method than tariffs for raising federal revenues, and gave President Woodrow Wilson justification for reducing tariffs.  Also at that time the idea of Prohibition was in the air, and advocates of Prohibition recognized the government would lose income from excise taxes on whiskey.


The 16th Amendment reads, “The Congress shall have the 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 was passed by Congress on July 2, 1909 and sent to the states for ratification.   


It was supposedly ratified by the requisite number of states by February 13, 1913.  However, there is some question about whether it was ever properly ratified.  In 1985, William J. Benson published The Law that Never Was about the income tax.  Here, Benson claimed that in 1984 he had visited national archives and all 48 state capitals looking for records of ratification.  Not only had he found variations in wording and punctuation from the congressionally approved amendment, but he claimed some states which were certified as ratifying never did or voted against the amendment.  He said only two to four states had ratified as written. 


Constitutional amendments require ratification by three-fourths of states.  In 1913, there were 48 states, so 36 would have had to ratify.  Benson found that seven states had not ratified at all.  1913 Secretary of State Philander Knox had claimed Kentucky and Tennessee ratified, but Benson said they did not.  Eight states were reported as having ratified, but Benson found no evidence of it.  Six more states did approve, but the governors or other officials required to sign did not sign.  Twenty-five states violated provisions of their own constitutions in ratification, and 29 violated state procedures.  Twenty-two states changed the wording to ratify, one state changed spelling, and 26 states changed punctuation.   Oklahoma changed the wording to say the opposite of what the amendment said.  Tennessee law required a delay until the next session but ignored it. 


The American Law Division of Congress’ Congressional Research Service responded in May, 1985 to Benson’s claims.  “While it didn’t rebut Benson’s factual claims,” it said the amendment had been ratified “because Knox said it had been ratified,” says one internet source.


In 1990 Benson went to prison for tax evasion.  He served 15 months before a federal appeals panel overturned the conviction, saying a government witness had given improper testimony in the 1987 trial.  This occurred less than one month before Benson was scheduled for parole.


Benson’s books caused quite a stir, and he was selling packages based on his book to help individuals fight the Internal Revenue Service.  However, those who have used his arguments have not fared well in court.  Also, Benson himself was the loser in court rulings in 2007 and 2009 that determined his “Reliance Defense Package,” which he sold for $3500 to tax protesters, was fraudulent. 


Courts have denied requests for evidentiary hearings and have refused to hear the arguments against the 16th amendment itself, claiming “Secretary Knox’ decision is now beyond review.”


In an interview in 2013, Benson remained an income-tax evader and bragged he has never gone back to prison, despite his continued outspoken crusade against the 16th amendment.





Ryan Messano Added Jul 5, 2018 - 11:48am
Good Article, Ms. Otto.
There are two more I might add: Here, and Here.
We absolutely do need to ban the income tax along with direct election of Senators.  These two evils have contributed to make our nation into a drone state, by taking away individual responsibility, and by entrusting the people with way too much power in the election of senators.  Demagogues have misled the people for far too long. 
Katharine Otto Added Jul 5, 2018 - 12:20pm
Thanks for the compliment and for the links.  I read both and found them reasonable and well thought out. 
The allusion to Woodrow Wilson is gratifying.  That the income tax/Federal Reserve scam was a means for getting the US embroiled in World War I and future wars was beyond the scope of the article, but I would like to follow up on that at some point.  
Stone-Eater Added Jul 5, 2018 - 12:45pm
An income tax is ok, as long as it is proportionally collected according to income.
I mean, no income tax, no environmental development like roads, hospitals, public transport etc. (in Europe)
Apparently in the US it's different. While in Frisco you have buses, BART and other regular transport, NYC has the tube, you can wait for an hour for a bus in downtown Miami. At least that's my experience.
opher goodwin Added Jul 5, 2018 - 12:50pm
Hi Katharine - a fascinating article. 
I like income tax. I think we need a greater progressive income tax in order to properly finance public services. We need to properly finance defence, education, health, infrastructure, welfare and social services and all of these are most efficiently run by the State and require high standards. Progressive Income Tax is the best and fairest way of achieving this.
Ryan Messano Added Jul 5, 2018 - 4:33pm
And the liberals with their dreams of big Daddy Gubmint show up.
Stone and Badlose, please visit a California DMV.  There you will see the results of big government.  Or, pick up your phones and call the CA DMV at (800) 777 0133.  Try to get through and get a decent answer.  You won't.  Yet you two nitwits swear by government bureaucrats.  Pathetic!  How do we wean our nation of leeches like you?  And why are you both commenting on American politics.  We don't want our nation to be a hellhole like Stone's and Gopher's nation's are.  Keep your noses out of our business, please!!
Badlose, it's not the governments job to finance welfare or healthcare.  Private enterprise is far superior. 
Kurt Bresler Added Jul 5, 2018 - 7:52pm
I do think that Healthcare,  if the Government has any responsibility at all should be on top of the list.  I am not saying eliminate Private Insurance but lets face it Private Insurance companies have profited big time off of the people.
There are many things the government should not be involved in and the first of those is maintaining Illegal immigrants.
Reading about the establishment of the Income Tax made my blood boil.   
Government should not be in the business of training the population to be dumbed down robots which work to support the state.
Ryan Messano Added Jul 5, 2018 - 8:00pm
The people are the problem in healthcare, Kurt.  We pay $700 billion a year for drug, tobacco, and alcohol issues.  Lifestyle choices are a huge part of the problem, then people complain about health care companies making lots of profits.  Well, if Americans would have been having children, instead of wiping out 200 million with abortion and contraception since 1965, we wouldn't be dealing with problems with Social Security, and Healthcare. 
We have 110 million American's with an STD, and we have 70 million on psychotropic drugs.  Stress comes from guilt, guilt comes from sin.   
Totally agree with your last paragraph.
Leroy Added Jul 5, 2018 - 9:26pm
I once had an accountant who was virulently anti-tax.  She believed that it was illegal.  She went to jail.  I regret signing her petition.  I often get the feeling of Lois Lerner looking over my shoulder, especially around tax time.
Katharine Otto Added Jul 5, 2018 - 9:57pm
Stone and Opher,
Before the income tax, federal revenues came mostly from tariffs and excise taxes, as on alcohol.  These are taxes on consumption, while the income tax is one on income.  In general, states are funded by sales and income taxes, and localities are funded by property taxes, with all levels of government profiting from such things as fines, licenses, and permits.
My biggest objection to the income tax is that it is so invasive and requires me to keep records and spend a lot of time doing paperwork for the government.  Also, it is a disincentive to work or to earn more than a bare minimum.  
Local transportation is funded by local entities, usually, as are water, sewer, and other basic necessities.  I can't agree that government does a good job of providing social services, unless you include all the needy bureaucrats.  I don't believe we need more roads when the federal and state Departments of Transportation (why the overlap?) can't seem to maintain what they already have.
I always appreciate your comments, even if you do live on the other side of the pond.
Katharine Otto Added Jul 5, 2018 - 10:11pm
Healthcare is a huge can of worms and is multi-factorial.  It doesn't have to be as expensive as it is, but it profits from overkill.  In the US, our worst problems result from lifestyles, such as diet, lack of exercise, stress, over-medication from legal and illegal drugs, smoking, and (I believe) environmental toxins, just to name a few.
On top of that the "health care industry" is very profitable on Wall Street, as is Big Food and fast food.  All of this drains the private and public purse, as well as public health.  Probably the healthiest thing people can do would be to turn off the TVs.
I imagine that if we didn't have a nanny state, there would be fewer immigrants.
Is it a government job to fix it?  Watch what people buy in the grocery store, and you will see why US Americans are fat, sickly, and broke.
Katharine Otto Added Jul 5, 2018 - 10:22pm
Now Ryan,
We can never know what might have happened if . . .
I'm someone who wants to get the government out of my business, and I wish no less for others.  I wouldn't have an abortion, or perform one, but I wouldn't stop someone else from doing it.  Those who oppose abortion should be willing to raise the children they "save."
I also don't believe in drug laws.  In a perverse sort of way, prohibitions and restrictions seem to exacerbate the problems they seek to control.  My personal belief is drug laws of all kinds are violations of personal freedoms.  If drugs were sold over the counter--all kinds of drugs, from blood pressure medicine to antibiotics to psychotropics--we would see a huge drop in costs and drug use.  Maybe people would take more responsibility for knowing just what they are ingesting and why.  We live in a pill-popping society.  Over-medication is a leading cause of death.
Katharine Otto Added Jul 5, 2018 - 10:23pm
Thanks for the comment.  It's hard to imagine an accountant who is anti-tax.  Did she oppose all taxes or just the income tax?
Ryan Messano Added Jul 5, 2018 - 11:10pm
Well, Katharine, low fertility rates destroy nations. We have 1.7 right now, replacement is 2.1, and Muslim women have 3.1. There is no such thing as a choice not harming anyone else. No child deserves to die. If people don’t want kids, don’t get married and don’t have sex. We did just fine When abortion and contraception were illegal for the first 188 years of our history. The last fifty three have been an unqualified disaster, only mitigated by stopgaps of tech advances, which mean very little. Look at San Francisco. Home of some of the biggest tech companies in the world, and they had 16,000 reports of feces JUST LAST WEEK.
We have about 1 million abortions a year, and 4 million are willing to adopt. The idea that life depends on money is abhorrent to all but barbarians and savages. Of course, no successful society has sex outside of marriage. We realized that in 1940, today, not so much. British agnostic anthropologist J.D. Unwin researched the 86 greatest societies in human history in a 1934 landmark study, and found they all had two attributes in common when they were successful and they left them when they declined. Those attributes were no sex before marriage, and sex in marriage between a man and a woman alone.
Chinas introduction of opium in the 1800s destroyed a 3,000 year dynasty. She didn’t get rid of drugs until Mao started slaughtering millions. We are on our way to communism too, with the legalization of drugs. The communists knew to destroy America you just had to introduce drugs and promiscuity and we would destroy ourselves. They were right. Legalizing drugs, contraception, abortion, homosexuality, and porn were all communist objectives, and all have been achieved.
Without virtue, liberty and freedom are impossible. There was just an article out today that the Los Angeles illegal pot market has boomed since the legalization of pot. No surprise. Laws banning pot, porn, contraception, abortion, and homosexuality are necessary, not because they prevent these things from ever happening, but because they prevent the vast majority of society from being overwhelmed by them. We had no problem doing all of this to great effect in 1940. As a result of permitting these social evils we have a dying nation, and the effete men of today are pansies compared to the powerful men who fought on the beaches of Normandy.
Anti-Limey Added Jul 6, 2018 - 1:13am
Katherine, an interesting post, as per usual. For some reason, I'm reminded of something a certain Roman Emperor said, I think it was Vespasian; when his consuls reported a particularly lucrative tax season, he supposedly said, "I want my sheep shorn, not shaved!!!" Nothing new under the Sun, lol.
Mark Hunter Added Jul 6, 2018 - 5:13am
Ah, I do love history. It can be very illuminating to people who don't understand where this stuff comes from, or think it's always been this way.
Stone-Eater Added Jul 6, 2018 - 6:56am
Private enterprise is far superior. 
Sure. First of all to put money into the pockets of a few. Very superior. When the state controls items which are essential for survival there's more guarantee that it's distributed fairly. Water, power, roads and health care HAVE to be controlled by the state, if not... know what our famous Swiss company Nestlé does in Ivory Coast ? Steal the water of the peasants, bottle it and SELL it to the people who can afford it as "mineral water flavored with vitamins".
You fucking know shit, Ryboy.
Spartacus Added Jul 6, 2018 - 9:37am
Very nice article, Katharine.
Dino Manalis Added Jul 6, 2018 - 11:06am
 Government needs revenues and it finds a way to take money out of people's pockets!
Leroy Added Jul 6, 2018 - 12:03pm
"It's hard to imagine an accountant who is anti-tax.  Did she oppose all taxes or just the income tax?"
All taxes but primarily income. 
She was a strange character.  Her father was a respectable accountant and an intellectual. I don't know if she had any formal training.  She never wore shoes not even in the winter.  Her office was littered with paper.  I got chewing gum on the bottom of my shoe one day.  I don't know if it was in her office or outside.  I ended up with someone's tax return stuck to be bottom of my shoe.  My father told me of the three-foot pile of egg shells on the kitchen table when her father was alive.  A few decades ago, her teenage daughter used to sunbathe topless in front of the house.   That was scandalous a few decades ago.  I guess my former accountant had a rebellious nature.
Doug Plumb Added Jul 6, 2018 - 5:12pm
Sherry Jackson and others are / were IRS Agents who exposed the unlawful nature of the income tax on wage earners. The fact of this tax being unlawful can't be doubted. But people are assumed to have aquiesced under the Admin Procedures Act. Even if you think income tax is good, its still unlawful to collect from the who do not wish to pay. I've explained this in other posts. Its a direct consequence of the common law and the law of obligation. These private central banks have no obligation to you, therefore, ditto. The money goes to protect the currency and trade, not to the streets and schools.
James E. Unekis Added Jul 6, 2018 - 6:33pm
Katharine O.
Good post, well written and a lot of knowledge.
A few years ago I got picked for an IRS audit.  My taxes were fairly simple as I had just a few things to itemize.   In response I simply sent them the documentation that I included in my original filing and they were satisfied.
I asked both my CPA and my attorney why they might have chosen to audit me since I had sent the documentation when I originally filed.  They both responded that the IRS will "go fishing" hoping that you lost your documentation.
Have you heard of this before?
Jeffry Gilbert Added Jul 6, 2018 - 9:08pm
Have you heard of this before?
Heard of a government agent trying to maneuver a citizen into unwarranted charges in an effort to justify the agent's job? Say it isn't so! 
Katharine Otto Added Jul 6, 2018 - 9:44pm
Michael B.
Thanks for the anecdote.  The US American sheeple are being skinned, I think.
Like lambs to slaughter, in some ways.  It's understandable that people wouldn't know, since so much happens in secret.  It's amazing how little information has been published about the early 1900s, before World War I.  I would have thought the income tax would have been very controversial, but apparently it slid right through without much of a fuss.
Katharine Otto Added Jul 6, 2018 - 9:52pm
I agree that certain things that benefit all, such as water and sewer, should be provided by government, but we have a situation in which the government doesn't do the work.  Government consists of bureaucrats, and farms out the work to, guess who?  Private contractors.  Some of our largest corporations get most of their income from government contracts.
Another point about the income tax that I didn't stress enough in the article is that it's a major mechanism for financing wars.  Taxpayers have zero say in how the money is spent.  If I had my druthers, taxpayers would vote directly on the budget, and it would be binding.  No cost overruns.  "Sorry, we decided not to fund the presidency this year.  I guess we will have to make do."
Katharine Otto Added Jul 6, 2018 - 9:54pm
Thank you for reading and for your praise.
Government exists to fund itself.  Everything else is incidental.
Katharine Otto Added Jul 6, 2018 - 9:59pm
She sounds like a strange lady, indeed.  You couldn't be making this up, right?
There's a lot of mystery surrounding the income tax, but people are afraid of the IRS.  I believe a former IRS commissioner insisted it is a "voluntary tax."  I've heard it's okay not to file but illegal if you file and don't pay.  I don't think anyone has definitive answers.  If so, they are not telling.
Katharine Otto Added Jul 6, 2018 - 10:04pm
I haven't heard specifically about that, but I do believe the IRS uses a variety of intimidation tactics,
Why would anyone want to be an IRS agent?  
Jeffry Gilbert Added Jul 7, 2018 - 2:30am
Why would anyone want to be an IRS agent?
Or TSA, FAA inspector, BLM Agent, Fish and Game, Park Ranger, DMV, ATF or any of the thousands of federal state and local positions who's express purpose is to keep the people afraid of the government and therefore obedient docile slaves?
I have no idea. 
Volek likely would. 
Doug Plumb Added Jul 7, 2018 - 6:34am
Katharine: This is the single most important issue of our age. Not only its effect politically, but what it says about us and our society. Politically we have Jews that own our money in a Christian nation. The Jews must consider the income tax as their single greatest victory over the goyim.
The problem with the free-man movement is that they are "technique happy" but do not understand the underlying theory.
When I asked a CRA agent why I had an obligation to the Crown when the Crown did not have an obligation to me, her response was "Well, we are above the law".
If I was elected king, my first order of business would be to have all the CRA agents associated with this tax arrested. The corporate income tax is perfectly lawful, so is a sales tax and other taxes such as property tax.
In Canada its been said that "voluntary" means self reporting under the penalty of perjury. The income tax form is not just a form but a contract, it is an "unconscionable contract". I am sueing.
Doug Plumb Added Jul 7, 2018 - 6:36am
We as a society must become more philosophical and learn more about laws. History is not the most important subject, it is merely anecdotal when it is true, which is rare, especially when learned in state schools.
338 Added Jul 7, 2018 - 7:47am
It's a simple game, government exists for and of itself, just like any parasitic entity.  Only a fool could believe it is here to help in anyway whatsoever.
TAXATION IS THEFT, of course we wouldn't ask the writer of the Declaration itself anymore, because we went to government mind laundries to learn, and let corporate owned , government sponsored media influence us every day rather than pick up any type of history book, and not the Federalist papers.
"What more is necessary to make us a happy and a prosperous people? Still one thing more, fellow citizens--a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned." --Thomas Jefferson: 1st Inaugural, 1801.
From Mr Jefferson himself, (that's Thomas not George for the newbies);
Try Bastiat, Hayek, Locke...  The They had prescient knowledge, and nowadays you hardly even have to pay to read their brilliant works.
But to open your own mind takes a lot of work, to sit around in conformation bias,  parroting the words of others, really takes no work at all. 
Of course to see the true evil of the tax code you need to get off your arse and get into the top tax bracket, have no deductions or socialist tax write offs for having children, pay horrible property tax rates and have no kids in aforementioned mind laundries, and then pay some form of tax on every single thing I buy anywhere at all, except on the street in cash.
Truly depraved, but I guess we are hundred years late to change it.
Katharine Otto Added Jul 7, 2018 - 10:36am
Unfortunately, I agree with you.  I figure government employees of all persuasions want to associate themselves with the "winning team."  A friend, retired Army Corps of Engineer electrical engineer, stated frankly that he wanted the job security, good benefits and retirement.  He was willing to sacrifice autonomy and creativity, and to make compromises to "go along to get along."
Katharine Otto Added Jul 7, 2018 - 10:49am
Mefobills, here on WriterBeat, makes a clear distinction between "finance capitalism," and other types, and he blames the Jews, too.  However, the Federal Reserve System, such as we know it, was designed by bankers who wanted the government perpetually indebted to them.  Some were Jews, like Paul Warburg, but most were not.  JD Rockefeller, for instance, was a strict Baptist.  JP Morgan was Episcopalian, and his son was virulently anti-Semitic, until he discovered it was profitable to lend to Jews during World War II.  (This from The House of Morgan, which I read some time ago, so don't remember the details.)
Perhaps the debt-backed dollar and the idea of obligating governments through indebtedness came originally from Jews, but I don't think it helps anyone to focus too much on that, except to understand how wimpy the US is when it comes to Israel.  
The "government over the people," with government "above the law" is a more reasonable target.  The Brits know nothing else, but the US should be savvier in terms of making the government accountable.
I could make a case for the income tax as enabler for the US' war-mongering all over the world, thanks to the debt-backed dollar that rides on the income tax.
Katharine Otto Added Jul 7, 2018 - 11:00am
An alternative to playing the game is to drop out of it, or to cost the government more than it costs me.  What I make from Social Security barely covers taxes, but I refuse to work and front for a system that does more harm than good.
If I thought it was too late to change things, I would give up, but I believe US Americans are tired of being played for fools, especially since the "freedom" we believed we had has become "license" for the government(s) do do whatever they want.  Federal, state, and local governments are in perpetual competition with each other for control and access to taxpayer pockets, and for what?  To create mayhem around the world, and at home, too?
"The economy," such as we know it, appears to be a government/banker/Wall Street entity that depends on labor (or the appearance of it) to fuel the illusion that everything is (or is going to be) hunky dory.  Just keep investing.   
Doug Plumb Added Jul 7, 2018 - 11:40am
Katharine re " Some were Jews, like Paul Warburg, but most were not.  JD Rockefeller, for instance, was a strict Baptist.  JP Morgan was Episcopalian, "
Rockefeller was Rothstein, he was a crypto Jew. Morgan was an agent for the Rothschilds.
Doug Plumb Added Jul 7, 2018 - 11:41am
re "I could make a case for the income tax as enabler for the US' war-mongering all over the world, thanks to the debt-backed dollar that rides on the income tax. "
The income tax on wage labour is and always has been a war tax.
Katharine Otto Added Jul 7, 2018 - 12:02pm
I can't argue with the Rothschild influence, but the common denominator with all of the "conspirators" in the Federal Reserve Act was greed and control by the banking cartel.  It extends far beyond the Jewish instigation, just as Christianity has.  Greed knows no religion.
Yes, the war tax idea needs to be shouted from the rooftops.  Too few people see that connection. 
Jas the Mace Added Jul 7, 2018 - 1:22pm
1. There is no law that says you have to file a 1040 form or pay them any money.
2. There are 2 supreme court rulings that back that up
3. Ask to see the law requiring you to file in court or bring up the SC rulings, and get thrown in jail for contempt of court. They can't show you what doesn't exist so all they can do is railroad you.
Watch: From Freedom to Fascism
Doug Plumb Added Jul 7, 2018 - 3:17pm
Katharine: re "I can't argue with the Rothschild influence, but the common denominator with all of the "conspirators" in the Federal Reserve Act was greed and control by the banking cartel. "
So, the fact that they were all Jews should just be overlooked as another strange co-incidence?
Doug Plumb Added Jul 7, 2018 - 3:37pm
Jas, you cannot be in a statutory jurisdiction and win the income tax argument.
Logical Man Added Jul 8, 2018 - 10:53am
It is notable that both the 'Federal Reserve' and permanent income tax both came into being in 1913.
This was not coincidental.
Katharine Otto Added Jul 8, 2018 - 12:26pm
Jas the Mace,
By the time you get to court, it's too late.  They want to make an example of you, and what's legal doesn't matter.  The only people who win are the lawyers, and they all work for the system.
Thanks for the YouTube link.  I will check it out.
Katharine Otto Added Jul 8, 2018 - 12:33pm
No, not overlooked, but it's not as crucial as understanding that they were all bankers committed to commandeering the public purse for private gain, especially to finance wars.
War is probably the single most effective method for shifting wealth upward.  Anyone who wants to address extreme income inequality needs to look at the method by which the wealthy use government to protect and increase their wealth.   
Katharine Otto Added Jul 8, 2018 - 12:37pm
Logical Man,
My point exactly.  It mimics the revenue-producing method of new taxation (specifically the whiskey tax) to finance the first central bank under Alexander Hamilton.  Hamilton was a big war monger and was eager to go to war with France.  
In both 1791 and 1913, the tax was passed before the central bank was approved.  Obviously the bankers wanted assurance they would profit mightily from lending to the government.
Jas the Mace Added Jul 8, 2018 - 5:44pm
@Doug, I am well aware of the false jurisdiction the 14th amendment creates for us turning us into "US citizens" instead of state citizens. Article 4 of the 14th says the debt owed to these international bankers "can not be questioned" Problem is, the 14th is unconstitutional for a bunch of reasons. That is not my opinion, that is the finding of congress recorded into the Congressional Record-House page 16541-5. They revisited the topic in 1968, the section is titled "The 14th amendment is unconstitutional" then 5 pages on all the reasons. So the "statutory jurisdiction" you mentioned, is an unconstitutional fraud. They use force to get their way.
Doug Plumb Added Jul 9, 2018 - 12:54am
In Canada, where I am, we have the same banks. We call them "The Crown"
Red October Added Jul 9, 2018 - 2:25am
That’s quite a conspiracy you’re trying to convince us of.  To think that the income tax, Federal Reserve and war was adopted as a means to make bankers more profitable, would mean the bankers are in control of government.  It would mean every politician was on the take and that none of them care more about America than the bottom line of bankers.  It would make nearly every public speech uttered by politicians to be total bullshit. In short, I don’t believe a word of what you just wrote, but I’d definitely like the number of your dealer. 
As for the income tax, it was adopted because the government needed money to finance spending.
As for the Federal Reserve, it was adopted because it makes sense for the government to have control over its central bank and a central currency.    
As for war, we fight them out of what was believed to be our last resort.
338 Added Jul 9, 2018 - 6:34am
You have a strong sense of government mind washing to you RO.
So in your humble opinion, we could only run the republic for the first 13X years without the income tax because?????
And to say the Federal Reserve was adopted
'because it makes sense for the government to have control over it's central bank and a central currency' puts you in a special class of uneducated 'citizens' that become rather good at keyboard cowboy, but not so good at actual fact based discussions.
I guess maybe that why the government made Federal Express too, so we could get our stuff to us real fast.
Doug Plumb Added Jul 9, 2018 - 7:05am
re "To think that the income tax, Federal Reserve and war was adopted as a means to make bankers more profitable, would mean the bankers are in control of government."
JK Galbraith has put it in writing, see his simple little book "Money: Where it Went; Whence it came". Alan Greenspan has said it publically, that is on youtube. Ellen Brown, an attorney, and many others have written about it in books on monetary reform.
Donnie and Barack ...and all the rest since 1913 have been puppets on a strings.
Doug Plumb Added Jul 9, 2018 - 7:06am
re " It would mean every politician was on the take and that none of them care more about America than the bottom line of bankers.  It would make nearly every public speech uttered by politicians to be total bullshit."
Kristen Foley Added Jul 9, 2018 - 8:00am
338: so every time the government creates a new tax, it’s because of some ulterior motive than the motive of desiring more of the private sector’s money?
Folks: The income tax should be abolished.  Where this article stops making sense has to do with the conspiracy theory floated.  It’s a conspiracy that would have begun in 1913 and continues today. It would mean both Obama and Trump are working together to keep America in he dark.  It would mean a billionaire like Trump, cares more about his kickback from bankers than the American people.  In short, it’s a totally preposterous theory, but kudos to you all for having a great imagination.
Katharine Otto Added Jul 10, 2018 - 9:34pm
In my view the income tax is an idea that grew over time and was promoted by people of different persuasions for different reasons, from Karl Marx to Nelson Aldrich.  The commonality was that they all believed in a centralized government that had control over the money supply.  The Constitution gives the federal government control over the money, but the Federal Reserve Act handed that power to the Fed, which is owned and run by a consortium of bankers.  No one seems to know who the actual shareholders of the Fed corporation are.  They are hidden in the shadows, but some claim they are descendants of the same bankers who sent representatives to the secret Jekyll Island meeting in 1910.
The income tax was assured before the Federal Reserve Act was passed.
I'm not the one who called it a "conspiracy."  I tried to avoid that term, simply because it is so loaded.  
I don't believe Obama, Trump, and Congress are knowingly complicit, because the system is so convoluted that probably no one completely understands it.  Anyone who tries to look gets severely trounced, marginalized, or ignored, as Ron Paul was when he called for an audit of the Fed.
Ari Silverstein Added Jul 11, 2018 - 9:07am
Otto: Nobody would disagree with your latest view on why we have an income tax.  However, your post alludes to some secret deal between bankers and government.  The income tax has little to do with the need with centralized government, our money supply or the Federal Reserve.  There are no big secrets or things hidden in shadows as it related to the Federal Reserve. Whatever questions you have can be easily researched and verified.
Katharine Otto Added Jul 12, 2018 - 1:48pm
Thanks for your comment.  If you are right, you should be able to name the primary stockholders of the Federal Reserve Corporation.  Also, you are contradicting what G. Edward Griffin writes in The Creature from Jekyll Island:  A Second Look at the Federal Reserve.  
If you can name the major shareholders, you will have succeeded where others have failed.  I'll look forward to reading what you discover.
Jeffry Gilbert Added Jul 12, 2018 - 11:48pm
The income tax has little to do with the need with centralized government
Ari, Ari, Ari, Federal Income Tax is the security the banksters demanded for their loans to the government. 
Ward Tipton Added Jul 13, 2018 - 3:07am
My problem is when even the government and their purported "legal" system cannot even identify what the Income Tax is: This from Black's Law 4th edition: 
"INCOME TAX. A tax relating to the product or
income from property or from business pursuits;
a tax on the yearly profits arising from property,
professions, trades, or offices; a tax on a person's
income, emoluments, profits, and the like, or the
excess thereof over a certain amount. Interstate
Bond Co. v. State Revenue Commission of Georgia,
50 Ga.App. 744, 179 S.E. 559.
An income tax is not levied upon property, funds, or
profits, but upon the right of an individual or corporation
to receive income or profits. Paine v. City of Oshkosh, 190
Wis. 69, 208 N.W. 790, 791. Under various constitutional
and statutory provisions, a tax on incomes is sometimes
said to be an excise tax and not a tax on property, Hattiesburg
Grocery Co. v. Robertson, 126 Miss. 34, 88 So. 4, 5,
25 A.L.R. 748; nor on business, but a tax on the proceeds
arising therefrom, Young v. Illinois Athletic Club, 310 Ill.
75, 141 N.E. 369, 371, 30 A.L.R. 985. But in other cases an
income tax is said to be a property and not a personal or
excise tax: Commonwealth v. P. Horillard Co., 129 Va. 74,
105 S.E. 683, 684; Kennedy v. Commissioner of Corporations
& Taxation, 256 Mass. 426, 152 N.E. 747, 748.
An "excise tax" is an indirect charge for the privilege
of following an occupation or trade, or carrying on a business;
while an "income tax" is a direct tax imposed upon
income, and is as directly imposed as is a tax on land.
United States v. Philadelphia, B. & W. R. Co., D.C.Pa., 262
F. 188, 190."
And if I am not mistaken, the Federal Reserve Trust was originally created in 1871 along with the Organic Act of 1871 ... I do know it was defended by SCOTUS under Salmon Chase, though I do not think it goes back as far as the Paper Currency Act signed by then Secretary of the Treasurer ... and the future Chief Justice who would support it ... Salmon P. Chase. 
Doug Plumb Added Jul 13, 2018 - 8:02am
Ward ! Thank you for that ! I've been looking for a definition of income that would match reality, I have Blacks forth, and others. I didn't look in Blacks forth yet !
People don't seem to want to know that wages are not income. Its a value for value exchange with no profit. Under the common law, they cannot tax life, but continuously try. Notice how they have changed the definition of volunteer to "self reporting under threat of perjury".
  Once you sign that tax return, you agree with them that you owe the money. They do have freedom of contract, as everyone does. I always tell young kids this, but its too much for them. They see the rope around their neck as a coming of age thing.
  re "And if I am not mistaken, the Federal Reserve Trust was originally created in 1871"
Conspiracy theorist sources, multiple of them claim it was passed when most legislators were away over the Xmas break of 1913. Most conspiracy theorists aren't lawyers, and don't read a lot of law but they are usually right in the monetary reform arena IMO.
Doug Plumb Added Jul 13, 2018 - 8:04am
Ward, I'm also hearing from law researchers, that I cannot sue the Revenue Collection Agencies, I have to go after the agents and their bonds. What do you think of that ? Can a man sue a statutory entity without going into statutory jurisdiction, given that common law rights were violated?
Katharine Otto Added Jul 13, 2018 - 3:16pm
Thank you.  I believe Salmon P. Chase was Secretary of the Treasury under Lincoln.  He and Jay Cooke used mass marketing techniques to sell war bonds to finance Lincoln's war.  Lincoln also instituted the first income tax, but I don't know if Chase was involved in that.  
Didn't you write in another article that Chase was one of your ancestors?
I appreciate your interest in this subject.  There's much more to discover and write than I could cover here so far, and it's nice to have company.
You, too, Doug.  The income tax was passed in February, 1913, just before Woodrow Wilson was inaugurated.  The 16th amendment had gone to the states for ratification in 1909.  So, you may be right that it was passed before the new Congress got up and running, which was probably in March.
Ward Tipton Added Jul 13, 2018 - 11:39pm
Yes, both Samuel and Salmon P. Chase were direct ancestors. 
The Federal Reserve Act was passed in 1913, but the Federal Reserve Trust was created either in the 1860s or early 1870s ... though its history is hidden. The trust came before the SCOTUS and was ruled by Chase as the Chief Justice to be Constitutional, though any such trusts from thenceforth would be unconstitutional by their very nature. It was something I put together from the Library of Congress materials in addition to some of the private papers held in my youth by my Grandfather ... a noted historian. 
In regards to issues of Jurisdiction ... this may take a couple of posts but ... no, if you use the federal reserve fiat currency, you waiver and forfeit any and all rights to legally contest such matters ... have to dig out the paperwork. If you were to sue them in their own courts it would also fall under federal sovereign jurisdiction so you would have to place yourself within their jurisdiction. 
Some matters of Jurisdiction should be available under title two of the USC in chapter sixty I believe ... though it has been "omitted" (as opposed to additional records and numbers that have been repealed and/or revised) from all of the Public records of the USC. 
Ward Tipton Added Jul 14, 2018 - 8:24am
House Joint Resolution 192 1933
(20 years after enactment of the Federal Reserve Act)
On June 5, 1933, Congress enacted HJR-192 to suspend the gold standard and to abrogate the gold clause. This resolution declared that "Whereas the holding or dealing in gold affect the public interest, and are therefore subject to proper regulation and restriction; and whereas the existing emergency has disclosed that provisions of obligations which purport to give the obligee a right to require payment in gold or a particular kind of coin or currency. . . are inconsistent with the declared policy of congress. . . in the payment of debts.
This resolution declared that any obligation requiring "payment in gold or a particular kind of coin or currency, or in an amount in money policy; and . . . Every obligation heretofore or hereafter incurred, shall be discharged upon payment, dollar for dollar, in any coin or currency which at the time of payment is legal tender for public and private debts."
A farm control bill around the same time period had attached to it a clause making Federal Reserve notes legal tender. In 1937, the Supreme Court struck down the Farm Control Act, thus carrying with it the legal tender status of Federal Reserve notes. Prior to 1933, Federal Reserve notes were used for inter-bank transfers. Around 1945, Congress passed a bill which called for the withdrawal of Federal Reserve notes from public circulation; but, they are still with us. . . *NOTE that the words do not talk about "payment" of debt, but clearly states that "Every Obligation . . . Shall be discharged."
In the case of Stanek v. White, 172 Minn. 390, 215 H.W. 784, the court explained the legal distinction between the words "payment" and "discharge": "There is a distinction between a `debt discharged' and a `debt paid.' When discharged the debt still exists though divested of its character as a legal obligation during the operation of the discharge. Something of the original vitality of the debt continues to exist, which may be transferred, even though the transferee takes it subject to its disability incident to the discharge. The fact that it carries something which may be a consideration for a new promise to pay, so as to make an otherwise worthless promise a legal obligation, makes it the subject of transfer by assignment."
Thus, it is clear that, as a result of HJR 192 and from that day forward (June 5, 1933), no one has been able to pay a debt. The only thing they can do is tender in transfer of debts, and the debt is perpetual. The suspension of the gold standard, and prohibition against paying debts, removed the substance for our Common Law to operate on, and created a void, as far as the law is concerned. This substance was replaced with a "Public National Credit" system where debt is money (The Federal Reserve calls it "monetized debt") over which the only jurisdiction is Admiralty and Maritime.
HJR-192 was implemented immediately. The day after President Roosevelt signed the resolution the treasury offered the public new government securities, minus the traditional "payable in gold" clause. Article I, Section 10, Clause 1, proscribes the States making any thing but gold and silver coin a tender in payment of debt -- but, this Article does not contain an absolute prohibition against the States making something else a tender in transfer of debt.
HJR-192 prohibits payment of debt and substitutes, in its place, a discharge of an obligation -- thereby not only subverting, but totally bypassing the "absolute prohibition" so carefully engineered into the Constitution. There is, now, nothing for this Article to operate on, just as there is nothing for Common Law to operate on. Perpetual debt, bills, notes, cheques and credits fall within a totally different jurisdiction than contemplated by Article I, Section 10, Clause 1 -- and that jurisdiction belongs exclusively to the Law of Admiralty and Maritime. Now, it is easy to see how "bills" as plenty as oak leaves, "polluted the laws after the War For Independence, as described by Peletiah Webster". This is how we lost access to substantive Common Law -- the very law the Minute Men fought to regain.
HJR-192 places every person who deals in the public national credit in the legal position of a merchant, and the only jurisdiction over any controversy involving this subject matter is Admiralty and Maritime. Obviously, if we cannot pay our debts at law, we are also benefiting from limited liability under the Limited Liability Act when we use this credit-- and, that is marine
Ward Tipton Added Jul 14, 2018 - 8:25am
HJR-192 places every person who deals in the public national credit in the legal position of a merchant, and the only jurisdiction over any controversy involving this subject matter is Admiralty and Maritime. Obviously, if we cannot pay our debts at law, we are also benefiting from limited liability under the Limited Liability Act when we use this credit-- and, that is marine insurance!
The definitions of "liability" and "insure" will help convince us of this fact -- in analyzing these definitions, keep in mind the distinction between "payment" and "discharge". Liability: The word is a broad term. It has been defined to mean: all character of debts and obligations. . . any kind of debt or liability, either absolute or contingent, express or implied . . . condition which creates a duty to perform an act immediately or in the future . . . duty to pay money or to perform some other service . . . the state of being bound or obligated in law or justice to do, pay, or make good something. "Insure: "To engage to indemnify a person against pecuniary loss from specified perils or possible liability".
QUESTION #1: Who do you suppose took possession of the treasury of the State of Pa. on June 5, 1933, -- the moment HJR-192 made it impossible for the State of Pennsylvania to pay its debts?
QUESTION #2: Land titles being allodial in Pennsylvania, what was the State Assembly's authority and jurisdiction to pledge these allodiums to the Federal Reserve as security for loan contracts from the Federal Government?
QUESTION #3: If the individual citizens of Pennsylvania were indeed "sovereign" under the Common Law -- What was the authority and jurisdiction of the State Assembly to pledge their labor to the Federal Reserve pool?
Clearly, the alleged authority and jurisdiction is the so-called public policy declared by Congress. We will return to this subject later on.
If all the assets of the United States have been hypothecated to the Federal Reserve "pool" as security for the maritime loan and insurance underwriting policy, then that raises a couple of questions:
QUESTION #1: If the United States "dies" (or is merged) under a One World government, who gets the pool?
QUESTION #2: If the Federal Reserve "dies" by way of getting its charter rescinded, who gets the pool?
The answers can be found in the Federal Reserve Act itself: "Should a Federal Reserve bank be dissolved or go into liquidation, any surplus remaining, after the payment of all debts, dividend requirements as hereinbefore provided, and the par value of the stock, shall be paid to and become the property of the United States and shall be similarly applied".
31 USC 315B provided that: "No gold shall after January 30, 1934, be coined, and no gold coin shall after January 30, 1934, be paid out or delivered by the United States; provided however, that coinage may continue to be executed by the mints of the United States for foreign countries". This exception was necessary because foreign countries, being recognized or sovereign, could not be held to the internal public policy of the United States. HJR-192 was binding only upon those individuals who were beneficiaries of public policy; that being the privilege of limited liability for payment of debt arising out of participation in the Federal Reserve Public Credit System.
HJR-192 automatically extended the privilege to renege on debts to every person using the Federal Reserve banking system; however, never forget that when you operate on a privilege, you have to respect the ruler of the giver of that privilege. Furthermore, in the case of Great Falls Mfg. Co. v. Attorney General, 124 U.S. 581, the court said: "The court will not pass upon the constitutionality of a statute at the instance of one who has availed himself of its benefits."
Thus, if you avail yourself of any benefits of the public credit system you waive the right to challenge the validity of any statute pertaining to, and conferring "benefits" of this system on the basis of constitutionality.
Ward Tipton Added Jul 14, 2018 - 8:41am
Title 2, Section Sixty, Subsection B ... and all of section sixty has been omitted IIRC, but when they ask you to plead, you must plead a mistake in jurisdiction under Title 2, section 60, subsection B unless they have already gotten you to submit to their jurisdiction ... all members of the court rise ... and when you rise up, you just submitted to their jurisdiction. It really is that convoluted and dare I say it ... perverted ... nothing whatsoever to do with justice. 
Katharine Otto Added Jul 14, 2018 - 3:01pm
I don't begin to understand the above, but thank you for writing it.  It plainly says "conspiracy" to me.  It validates my studied belief that the US is a sham and the Federal Reserve is a shell.  
In simple terms, it suggests that anyone who uses dollars has agreed to the system so is bound by it.  
I hope never to go to court for any reason, but if I must, I won't rise.
Katharine Otto Added Jul 14, 2018 - 3:19pm
I was wrong about passage of the income tax.  The Revenue Act of 1913, also called the Underwood Tariff Act or the Underwood-Simmons Act was passed by the House on May 8, 1913.  Woodrow Wilson strong-armed the Senate into passing it.  It reduced most tariffs from 40 to 25% and re-instituted the income tax under the recently ratified (supposedly) 16th amendment.
Wilson signed it on October 3, 1913.
This from Wikipedia.
Katharine Otto Added Jul 14, 2018 - 3:20pm
I also Googled the Federal Reserve Trust of 1871 and could find no mention of it.  The plot thickens.
Doug Plumb Added Jul 14, 2018 - 7:27pm
re "In regards to issues of Jurisdiction ... this may take a couple of posts but ... no, if you use the federal reserve fiat currency, you waiver and forfeit any and all rights to legally contest such matters ... have to dig out the paperwork. If you were to sue them in their own courts it would also fall under federal sovereign jurisdiction so you would have to place yourself within their jurisdiction. "
I've heard that before, its an old argument. It may work in the USA, but I don't think it works up here. Funny - no records of wage earners being in court as I look through court records online.
  All this is like watching your neighbor rape a ten year old boy and not being able to do anything about it. Its time to remove the holohoax goggles and see whats really going on.
Jeffry Gilbert Added Jul 14, 2018 - 10:22pm
It validates my studied belief that the US is a sham and the Federal Reserve is a shell.  
Sums it up quite nicely. 
Ward Tipton Added Jul 15, 2018 - 1:45am
As to the federal reserve act, I too have been unable to find anything online. So much of my work in my youth was based on the actual writings of Chase, Lincoln and other key players of the time that my Grandfather had in his library. I further was able to corroborate a lot of it by digging through well-hidden files in the Library of Congress ... though whether or not they were intentionally buried may be a subject for debate. 
I would not say so much that the US is a sham, but rather a corporate entity largely owned and controlled by the power players, including the federal reserve trust. (I have to review the organic act of 1871 as well, as it may have been buried in there but I do not remember for certain ... though it seems as it was attached somehow, perhaps as a reference or footnote in the original paperwork?) Unfortunately, the complacency of the average person has allowed the show to continue unabated and unchallenged. Trying to change the system these days barring anything other than a change in the global currency exchange and the global reserve currency ... the "global currency reset" often bantied about on conspiracy sites ... naught will change ... but to believe that the proverbial powers that be will sit back and allow this to happen is equally foolish, especially when it is so easy to instigate global war and reset the economy at the end of that when everyone is so happy just to have survived and the people are largely unconcerned with rebuilding the economy from the ground up as they already have to rebuild their infrastructure from the ground up, which in turn rebuilds the economic and financial systems back up in their current form ... thus any accrued proceeds of the proverbial powers that be remain in their control, while the debt-based, fractional reserve fiat currency gets printed on new paper and once again, we are all paying interest on a debt that can never be repaid. 
Doug Plumb Added Jul 15, 2018 - 2:45pm
I think the PTB invented these digital currencies so they could operate outside the jurisdiction of law enforcement. I don't like digital currencies because they are lawless currencies.
I really appreciate you being on here Ward.

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