“It is the first responsibility of every citizen to question authority.”
As a starting point to this issue, I will be addressing the authority of our federal government to take our property, or the power of taxation. To start with there is a maxim that if the facts, or foundation, of any conclusion is in error; then that conclusion is in itself is false. Using the Occam’s razor principle, telling us to “Keep Things Simple” or “the best explanation of an event is the one that is the simplest . . .”
The government’s claim to their authority to impose the income tax is founded in the 16th Amendment. “The Sixteenth Amendment to the Constitution authorizes Congress to impose an income tax.” Ms. ReNae Fielding, Disclosure Officer, Internal Revenue Service, Fresno, California,1994; Senator Orrin Hatch, Utah, 2004; “This power to collect tax on income arises primarily from the 16th Amendment to the Constitution ratified on February 3, 1913. The 16th Amendment states that “the Congress shall have the power to lay and collect taxes on income.” This would seem to be the simplest answer, however, it is a conclusion, as one Supreme Court justice pointed out, as being “without foundation”.
The authority of taxation was given to pay for the necessary expenses incurred by the government in the performance of its constitutional duties. A fundamental problem this nation is faced with is that most of these government agencies and entitlements which have been created, have no constitutional foundation, . . . but that’s for another time. This monumental growth in the bureaucracy creates the inherited problem of paying for all of these social programs.
Focusing on the Federal government, here we are agreed on one thing, that is at present, the Federal government is out of control to the extent that it has exceeded its “limited” responsibilities as out lined in the Constitution. Looking for the revenue to pay the expenses of a “run away” government now consumes a majority of Congress’s time in the legislative process. We are faced with a situation where the creation is dominating the creator. “. . . when the power and majesty and honor of those who created shall become subordinate to the thing of their creation, I but feebly utter my apprehensions when I express my firm conviction that we shall see ‘the beginning of the end.” President Franklin Pierce, Steward Machine Co. v. Davis
The present election now becomes a contest between those who look to Big Brother to care for them and on the other side who believe in individual freedom and responsibility to take care of themselves. We are polarizing our nation into these two groups. Indeed we have a house divided. We are witnessing in this contest that the present party in power is supported by a majority who are, and seem to be content, dependent upon government to take care of them.
The objects of government and its source of revenue were pointed out early on by Senator Sherman; “. . . The objects of the Union, he thought (Mr. Sherman) were few. 1. defence against foreign danger. 2. against internal disputes & a resort to force. 3. Treaties with foreign nations. 4. regulating foreign commerce, & drawing revenue from it. . . .”; Notes of Debates in the Federal Convention of 1787 [Madison]. To this James Madison stated in “The Federalist Papers No. 45”: “The powers delegated to the federal government are few and defined. . . . . The former (the federal government) will be exercised principally on external objects as war, peace, negotiation, and foreign commerce; with which the last power of taxation will, for the most part, be connected. . . .” It is clear to see how this have changed.
The Income Tax has become, the main source of revenue that the government depends upon to cover these expenses, and those elevated to positions of power, guided by the legal profession, over the decades, have indoctrinated us into believing that there is no limit to the extent of the government’s taxing power. In 2010 payroll taxes amount to 40 percent and income taxes came in at 42 percent. This on its face this would seem right, in a “democracy”, yet for a “republic” it is a false assumption which has been addressed numerous times by the Supreme Court. An early 1875 decision pointed out; “There is no such thing in the theory of our national government as unlimited power of taxation in Congress. There are limitations of its powers arising out of the essential nature of all free government; 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.” (Loan Associates v. Topeka, 87 U.S. 655).
The Supreme Court on this subject pointed to several of these “natural rights” confirming the Loan Associates opinion, in a 1964 decision Lucas vs. Forty-forth General Assembly, (377 U.S. 713); “One’s rights to life, liberty, and property … and other fundamental rights may not be admitted to vote; they depend on the outcome of no election. A citizen’s constitutional rights can hardly be infringed simply because a majority of the people choose that it be.” As indicated, among those “natural” rights is the protection of our property and the “fruits” of our labor.
According to a recent survey the largest voting block in Congress is composed of lawyers . . . 43 percent. With this influence in Congress, they along with others have made the false assumption, mentioned earlier, that the Sixteenth Amendment delegates that authority to them.
Not so said the Tax Court in Penn Mutual Indemnity Co. vs. Commissioner, 32 Tax Court 659; “In dealing with the scope of the taxing power the question has been framed in terms of whether something can be taxed as income under the 16th Amendment. This is an inaccurate formulation of the question and has led to much loose thinking on the subject. The source of the taxing power is not the 16th Amendment; it is Article I, section 8, of the Constitution.”
If they would do their homework, they would discover that the Supreme Court addressed that error very early on when Chief Justice White, in Brushaber v. Union Pacific, speaking to taxation and the Sixteenth Amendment, pointed out that; “We are of opinion, however, that the confusion is not inherent, but rather arises from the conclusion that the 16th Amendment provides for a hitherto unknown power of taxation; that is, a power to levy an income tax which, although direct, should not be subject to the regulation of apportionment applicable to all other direct taxes.” (240 U.S. 1 at 11)
The Chief Justice calling this an “erroneous assumption” discusses four particular contentions which really can be summarized in the statement quoted that, “the confusion is not inherent, but rather arises from the conclusion that the 16th Amendment provides for a hitherto unknown power of taxation; . . .”, again ending his thought by stating; “. . . the far-reaching effect of this erroneous assumption will be made clear . . . .”
The Chief Justice goes through a lengthy explanation on the Amendment and taxation concluding at page 18 pointing out, “. . . that the contention that the Amendment treats a tax on income as a direct tax although it is relieved from apportionment and is necessarily therefore not subject to the rule of uniformity as such rule only applies to taxes which are not direct, thus destroying the two great classifications which have been recognized and enforced from the beginning, is also wholly without foundation . . . .”
In a following case, during that same session (1916), Justice White agains reaffirms “. . . that by the previous ruling (speaking of the Brushaber case) it was settled that the provisions of the 16th Amendment conferred no new power of taxation, . . . .” (Stanton v. Baltic Mining, 240 U.S. 103) Just a note here, lower courts are still confused on this issue on whether the income tax is direct or indirect and which rules apply.
Some examples from tax cases will demonstrate this. The Eighth Circuit Court, in a 1980 case blatantly misquotes Justice White and the Brushaber ruling when it attempts to quote the opinion in U.S. vs. Francisco, 614 F. 2d 617; “The purpose of the Sixteenth Amendment was to take it ‘out of the class of excises, duties and imposts and place it in the class of direct taxes.” Quoting Brushaber at page 19, when in fact the Brushaber Court said, and I emphasis the term “PREVENTION”; “. . . the purpose of the (Sixteenth Amendment) was not to change the existing interpretation except to the extent necessary to accomplish the result intended, that is, the prevention of the resort to the sources from which a taxed income was derived in order to cause a direct tax on the income to be a direct tax on the source itself and thereby to take an income tax out of the class of excises, duties and imposts and place it in the class of direct taxes.”
A careful reading of the Brushaber opinion clearly outlines that; “the Amendment . . . shows that it was drawn with the object of maintaining the limitations of the Constitution and harmonizing their operation.” Chief Justice White emphasizes that the income tax is and always has been sustained as an indirect tax.
Yet the confusion continues; the Judge in a Tax Court Case in 1981, Lonsdale vs. C.I.R. states: “Appellant (claims that). . . the income tax is a direct one that must be apportioned among the several states. . . . This requirement was eliminated by the Sixteenth Amendment.” Lonsdale vs. Commissioner of Internal Revenue, T.C. Memo 1981-122; again in a 1984 federal case; “. . . the sixteenth amendment was enacted for the express purpose of providing for a direct income tax. . . . The Supreme Court promptly determined in Brushaber v. Union Pacific R.R. Co., . . . that the sixteenth amendment provided the needed constitutional basis for the imposition of a direct non-apportioned income tax.” Parker vs. Commissioner of Internal Revenue, 724 F. 2d 469.
Going back to keeping things simple, the previous discussion shows that what should have been simple, turns out to be just the opposite. The facts now given shows that; first, the 16th Amendment did not authorize the income tax and secondly, the income tax is an excise tax, not on property, but on its use. This sets aside the main foundation block removing it from support for the authority of the federal government to impose the income tax private citizens. Only “subjects” of government are within the scope of Title 26.
It is important to build a solid foundation upon which to form conclusions. To start off with the maxim, that if the foundation or facts are wrong then all conclusions drawn from those faulty facts are themselves wrong. Remember, those of you who are being attacked or have been, can always challenge the jurisdiction at any time. The foundation for the free and natural citizens of America, is also a barrier against the government’s claims of authority. Question that authority every time and demand that the government produce the basis of their authority. This is the concept of jurisdiction. The government claims that all citizens are within their authority or jurisdiction, but we’ll see.
We’ve put aside the 16th Amendment argument and turn to the law in Title 26 and its regulation. In understanding the law we should know the legal definition of certain terms used in the law. The regulation which implements the statute is found at 26 CFR Section 1.1-1 of the Treasury Regulations and states that the law “. . . imposes an income tax on the income of every individual who is a citizen or resident of the United States . . .”. The regulation at 26 CFR section 1.1-c of the regulation defines a “citizen” as; “Every person born or naturalized in the United States and subject to its jurisdiction is a citizen.”
In section 1-1c of the regulation, there are two elements to the definition. First, the person must be born or naturalized in the United States. Secondly, the person must be subject to the jurisdiction of the United States. Both elements must be present in order for a “person” to be a “citizen” of the United States.
To begin with it must be understood how the term “United States” is used. We all have a common understanding when we use the term, however, this term becomes a “legal” term and as such the court has defined it as follows; “The term ‘United States’ may be used in any one of several senses. It may be merely the name of a sovereign occupying the position analogous to that of other sovereigns in the family of nations. It may designate the territory over which the sovereignty of the United States extends, or it may be the collective name of the states which are united by and under the Constitution.” Hooven & Allison Co. vs. Evatt, 324 U.S. 652 at 671 (1945)
So the term United States can be used in at least three ways. As a sovereign among nations; over territory which it is a sovereign; and thirdly, the collective name of the States under the Constitution. We normally think of the third meaning, however, we are talking about the legal sense of the word and therefore the second meaning is proper, the territory over which the federal government is sovereign and makes the laws accordingly.
Knowing which united states we are talking about, we can look at just who is a “citizen” subject to that jurisdiction. Remember that in this Republic and under our Constitution, upon birth you are not a “subject” but a free and natural “sovereign” on equal footing with the founders of this nation. If you are to be considered a subject, it would be to your parents. However, you, being a “natural” person maintaining your status as a “sovereign” person, having NO obligations, contracts or stipulations that would tie you to the government have this unique position in your relationship to federal or State laws. We can look at these in turn and examine the foundation for federal jurisdiction.
The individual or person must then be within the purview of the court. This is generally the case when a statute is involved. The defendant must be within the command of the statute, and the plaintiff or in most cases the government, MUST show that the statute applies to the defendant or person. Always attack the jurisdiction of the government.
The government’s authority to tax is necessary to meet expenses and the tax on incomes is within their scope over which they have jurisdiction, but this jurisdiction is not a blanket that covers all . . . but only a special group. Those who are without the scope of federal jurisdiction have solid foundation that supports their position as sovereigns and exempts them from the income tax.
Consider now those facts which are at the foundation of this relationship which separates the free person from the subject of government: FIRST: Sovereignty. As a free and natural person not subject to government contracts or obligations which would attach the status of “subject”, have the status of a “sovereign”. This fact is found in the first three words of the preamble to the United States Constitution; “We the people . . .”. The people are the “creators” of the Constitution, the document or contract between the creator and the creation. The very definition of a “sovereign” was simply laid out by former Chief Justice John Marshall in his landmark case M’Cullock v. State speaking to the sovereignty of a State; “The sovereignty of a state extends to everything which exists by its own authority, or is introduced by its permission; . . .” (17 U.S. 316, 429) Marshall was of course talking to the action of a State having taxing power over a creation of the federal government. It was concluded that “sovereignty” being the supporting foundation for taxing, and since the sovereignty of a State, as defined by Marshall, did not include a “creation” of the federal government, the “creation” of the federal government is without the scope of State taxing authority. The principle is, however, also applicable to federal and individual jurisdiction.
This Constitution set up and defined the scope and authority of the Federal government. It establishes just what the federal government can do, and any other activity, not so designated, is outside the scope of the federal government. In objecting to the Bill of Rights Alexander Hamilton made it clear when writing his letter number 84, “For why declare that things shall not be done which there is no power to do? Why, for instance, should it be said that the liberty of the press shall not be restrained, when no power is given by which restrictions may be imposed?”
This was also reaffirmed by the court in 1884; “There is no such thing as a power of inherent sovereignty in the government of the United States … In this country sovereignty resides in the people, and Congress can exercise no power which they have not, by their Constitution entrusted to it: all else is withheld.” (Juilliard vs. Greenman, 110 U.S. 421 (1884)
It would be foolish to read into the Constitution any provision that would subject the people to the authority of a government, or that one individual would be superior to another. Next we look at a forgotten principle of a Republican government, and that is “delegation of authority”. A few definitions and quotes will make this simple to understand. Looking at Black’s Law Dictionary under
Delegation used as a verb, means “to transfer authority from one person to another; to empower one to perform a task in behalf of another.” Another associated word is Power which is “the right, ability, authority, or faculty of doing something. Authority to do any act which the grantor might himself lawfully perform.” The Supreme Court the source of federal power when it said; “The question is not what power the Federal Government ought to have but what powers in fact have been given by the people.” United States v. Butler, 297 U.S. 1, 63 (1936).
On this same subject Ezra Taft Benson, then Secretary of Agriculture under President Eisenhower said; “They [the individual] cannot delegate a power they themselves do not have. This important principle was clearly understood and explained by John Lock nearly 300 years ago; “… Nobody can transfer to another more power than he has in himself, and nobody has an absolute arbitrary power over himself, or over any other, to destroy his own life, or take away the life or property of another.” [John Locke, ‘Two Treatise of Government’, book II]
Dean Russell; “Whenever government is doing anything that is forbidden to the citizen, that function is illegitimate, according to our theory of government…. Our government is founded squarely on this ‘theory of delegation’. One cannot delegate what he doesn’t have.” [ Letter to Compiler, March 19, 1964]
“The right never existed, and the question whether it has been surrendered, can not arise.” Former Supreme Court Chief Justice John Marshall (M’Cullock vs. Maryland, at p. 431) To put it another way, you never had the authority to take my property, so the question that you gave it to the government can not arise.
Having looked at sovereignty and delegation of authority, we consider just what makes a citizen a “resident” of the United States, subject to its jurisdiction and this fact deals with the territorial jurisdiction of the federal government. Starting with the Supreme Court; “The power of the United States to tax is limited to persons, property, and business within their jurisdiction, as much as that of a state is limited to the same subjects within its jurisdiction.” (United States v. Erie Ry. Co., 106 U.S. 327, 333, (1882), Justice Field in dissent)
The legislative jurisdiction of the federal government is outlined in the Constitution under Article I, Section 8, clause 17 which states; “ To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings; . . . .”
This jurisdiction is really quite limited in its scope. It has “exclusive legislation” over the District of Columbia and over land purchased, with the consent of the States for the expressed purpose “for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings; . . . .” The Constitution does not give the Federal government any legislative authority within the respective States except for the purposes itemized. And it MUST be with the consent of the State. I took the opportunity to research the statutes for the State of Utah and the only consent to federal legislative jurisdiction was granted over military lands like Hill AFB.
“The consent requirement of Article I, section 8, clause 17 was intended by the framers of the Constitution to preserve the State’s jurisdictional integrity against federal encroachment. The Federal Government cannot, by unilateral action on its part, acquire legislative jurisdiction over any area within the exterior boundaries of a State,”
The law’s of Congress in respect to those matters (outside of Constitutionally delegated powers) do not extend into the territorial limits of the states, but have force only in the District of Columbia, and other places that are within the exclusive jurisdiction of the national government. (Caha v US, 152 U.S. 211) Constitutional restrictions and limitations were not applicable to the area of lands, enclaves, territories and possessions over which Congress had exclusive legislative authority. (Downes v. Bidwell, 182 U.S. 244)
State jurisdiction encompasses the legislative power to regulate, control and govern individuals, enterprises. real and personal property’ within the boundaries of a given State. Federal jurisdiction, by contrast, is extremely limited and can be exercised only in areas external to the sovereign States unless, and until, a State has ceded a portion of its jurisdiction to the federal government.
The legal effect of the Declaration of Independence was to make each newly created State a separate and independent sovereign over which there was no other government, superior power or jurisdiction. (M’ilvaine v Coxe’s Lessee, 8 US 209)
(Jurisdiction Over Federal Areas Within The States: Report of the Interdepartmental Committee for the Study of Jurisdiction Over Federal Areas Within the States, Part II. at 46.)
When our elected officials and the ‘unelected’ bureaucrats come to understand these principles, which are the foundation of all government, state or federal lawmaking, then the statutes and powers of same are easily understood and classified. What the lawyers, bureaucrats and elected officers have failed to understand are these two principles. If President Obama and/or Governor Romney will use not only the Constitution, but also use these principles and put the powers of government against them, you would be surprised how extensively the bureaucracy will be cut.
Think about this also candidates, when you are talking about taxation. Remember, that the 16th Amendment did not give you the government, power to impose the income tax. Do the genealogy – where did you get your authority to take my property?