Stop Congress Mortgaging the Labor of Children
Debt is the tax on future labor.
Question: What is wrong with us that we mortgage the future labor of every child for $107,801?
Answer: Since the Great Depression, Congress violated the Constitution by expanding federal taxing to "provide" welfare -- creating "needful" Tyranny of the Majority. This shift transformed the federal government's action from its duty to "provide for the common defence" of "Liberty to ourselves and our Posterity" into one of redistributing wealth borrowed from children.
The purpose of this document is to propose the repeal and replacement of the 16th Amendment. Federal taxation should be grounded in the government's constitutional duty to “provide for the common defence.” Those with the most assets to lose if America loses a war should bear the greatest share of the cost to protect those assets. Working people—who will provide the bulk of the soldiers in any war—should not have their labor taxed to meet the Federal mission except in times of declared war.
Limiting Federal taxing of wages to times of war, provides a reserve that can be accessed in times of war.
Taxation for welfare is the sovereignty of state governments. National welfare programs may exist, but the authority to collect taxes for them belongs to the states. Under this constitutional framework, states—not individuals—would fund federal welfare programs. Efficacy of national programs would have to meet state expectations. This approach respects the Constitution’s clear restriction that the federal government may only “promote the general welfare”—not tax to provide it.
As James Madison explained in Federalist #45:
“The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite.”
In his 1792 speech opposing a federal public works bill, Madison warned:
“If Congress can apply money indefinitely to the general welfare... it would subvert the very foundations, and transmute the very nature of the limited Government established by the people of America.”
And in Federalist #46, Madison clarified the dual roles of government:
“The federal and State governments are in fact but different agents and trustees of the people... constituted with different powers and for different purposes.”
Here is the existing 16th Amendment and a proposed repeal and replacement:
16th Amendment:
"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."
Recommended Amendment to repeal and replace the 16th Amendment:
Section 1: The sixteenth article of amendment to the Constitution of the United States is hereby repealed."
Section 2: To provide for the common defense, Congress shall have power to lay and collect taxes on the value of capital assets, including but not limited to real property, financial instruments, digital assets, and intellectual property. Taxes shall be levied on the assessed value of assets, including unrealized gains, when such assets may be used as collateral for borrowing or otherwise demonstrate liquidity. The tax shall be adjusted downwards based on the illiquidity of the asset, its increase of employment, and its role in critical economic functions, such as food production, as determined by Congress, to prevent undue burden on assets essential to economic stability. Such taxes shall be uniform throughout the United States and shall not be apportioned among the several States.
Section 3: Consistent with the Constitution’s limit to promote the general welfare, the Supremacy Clause’s pursuance requirement, and the 10th Amendment, only states have sovereignty to levy taxes for welfare programs. Federal programs providing welfare shall be funded through contributions collected and remitted by the States to the federal government, with contributions apportioned based on a formula combining state population and economic capacity and phased in over three years, as agreed to by the States through an interstate compact within six months of ratification. If no compact is reached within six months, Congress shall establish the apportionment formula and transition schedule. Such programs shall be subject to state financial oversight to ensure accountability to the people. Congress shall not borrow against future taxes for welfare programs, except during a Congressionally declared war and for three years following the war’s end, to provide for the common defense.
Section 4: Congress shall have power to enforce this article by appropriate legislation, provided such legislation preserves the sovereignty of the people and the States, and encourages liberty and innovation in accordance with the Constitution.
Section 5. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of three-fourths of the several States within seven years from the date of its submission to the States by the Congress.
Background:
As a foundation 1. The 1st purpose of governments is to monopolize violence within a jurisdiction, to minimize violence from war and crime by coercing compliance with law. 2. We, the People, are sovereigns. We tolerate government confiscating value from our lives to minimize violence from war and crimes. 3. To constrain the nature of governments to monopolize and coerce, in ratifying the US Constitution, we Divided Sovereignty between our Liberty and two types of governments to coerce two types of violence. 4. War: The Federal government has unlimited taxing power for the limited jurisdiction to "provide for the common defence," to minimize violence from war. Although violated since the New Deal, the Constitution limits the Federal government to only "promote the general welfare." 5. Crimes and civil disputes: States are sovereign within their written constitutions. 6. Liberty: Our liberty innovates the general welfare as two aspects intertwine in a Darwinian crucible of creative destruction. Tolerance of Disruptive Minorities offering choices and tolerance of the Wisdom of the Many sorting choices in free markets and free speech.
Funds need to be balanced between these needs to minimize violence and encourage liberty.
Focus on paying for value by type of violence: Losing a war exposes those with capital assets to the loss of their assets. Those without capital assets, the many, generally support war efforts by committing their bodies as soldiers. My feeling is that funding the Federal government to pay from the "common defence" should come from a tax on capital assets. This needs to be adjusted based on the income and jobs created by that capital asset: 1. Farms may have a large capital value, but so little income that extracting taxes would collapse the food supply. 2. BitCoin values have increased by 10,000 times, yet no tax is collected if assets are held without trading.
What sources and quotes are there for creating a Constitutional Amendment to end the 16th Amendment and replace it with an Amendment that will provide the Federal government with only defense taxes based on a combination of capital value and capacity to pay.
Note: A very small minority has benefit to an extreme degree because technology amplified wealth creation. These individuals deserve wealth, but not on the scale as technologies they leveraged were created by themselves and many others.
Note on Divided Sovereignty: Federalist #1-46 specifically address this Divided Sovereignty. The concept of Federalism address the difference between Federal and state sovereignty but generally fails to acknowledge that we the people are the sovereigns. An illustration of this failing is the failure to significantly use the 9th Amendment to force governments to recognize the sovereignty of citizens. The concept of "states rights" is also polluted by violations of liberty by states via slavery and Jim Crow.
Federalist Papers examples of Divided Sovereignty: Federalist #46 (Madison): "The federal and State governments are in fact but different agents and trustees of the people, constituted with different powers, and designed for different purposes."
Federalist #51 (Madison): “Ambition must be made to counteract ambition.”
Federalist #28 (Hamilton): “Power being almost always the rival of power, the general government will at all times stand ready to check the usurpations of the state governments, and these will have the same disposition towards the general government. The people, by throwing themselves into either scale, will infallibly make it preponderate. If their rights are invaded by either, they can make use of the other as the instrument of redress. How wise will it be in them by cherishing the union to preserve to themselves an advantage which can never be too highly prized!”