The Sovereign Tax-Collector
Frank Chodorov
[Reprinted from One Is A Crowd, Devin-Adair
Co., New York, 1952]
WHEN the Union was founded, political scientists were agreed on the
axiom that the source of sovereignty is the individual. It is from him
that government derives its powers. This involves another assumption,
the one about "natural rights" inhering in the individual by
virtue of his existence or by divine gift. The two ideas, necessarily
related, emerged from the revolt against absolutism, resting its case
on the doctrine of the "divine right of kings."
Neither doctrine as to the source of sovereignty is provable. The
nature of sovereignty, however, is beyond doubt; it is the degree of
coercion that the government exerts on the people; and this degree of
coercion is in turn dependent on the amount of the nation's wealth the
government has at its disposal. For the coercion must be exerted by
men, and men must live while they carry out the orders of the
government. The police must be paid.
In short, sovereignty is a matter of taxation; the more taxation the
more sovereignty. Conversely, the immunity of the people is in
proportion to the amount of their wealth they can keep out of the
government's hands. It follows, then, that the Sixteenth Amendment,
which gives the government a prior claim on all the production of the
country, puts the government in the way of acquiring as much power as
it is possible for a government to exercise; that is, under our
revised Constitution it is possible for the government to attain
absolutism The introduction of income taxation destroyed the 6riginal
concept of the Union -- as consisting of autonomous states, in which
political power was a concession from sovereign citizens -- just as
effectively as if it had been done by a foreign invader.
The indisputable fact of the Sixteenth Amendment is its socialism; it
denies the right of private property. Other taxes, particularly the
indirect kind, are apologized for on the ground of necessity: the cost
of maintaining the political establishment must be 'net by the
citizenry, but the levies are made as painless as possible by hiding
them in the price of goods. The income tax, on the other hand,
unashamedly proclaims the doctrine of collectivized wealth. The State
may take whatever it needs, as a matter of right; that which it does
not take is a concession. It has first claim on all the earnings of
all the people. A paraphrase of the income tax law would go like this:
Thus much thou shalt have for thy keep. Thus much
more for the keep of thy wife; and for the nourishment of thy
children, until they too enter into the service of the State, an
allowance is made. Thou mayest also deduct for medication, if any,
and for such expenses of thy business as are necessary for its
continuance, and a percentage for thy favorite charities so as to
relieve the State of maintaining them. All the rest belongs to the
State, as a matter of right. And, mind thee, these exemptions and
the rate of taking the State may alter at will, from year to year.
Is this an exaggeration? There is nothing in the Sixteenth Amendment,
there is nothing in the spirit of income taxation, that puts a limit
on what the State may confiscate. Legally, all that is produced by the
citizenry may be demanded, and the relationship between the State and
its subjects, as far as property is concerned, approximates the
relationship between master and slave. What makes the slave a slave is
that he is legally denied the right of property, and the master is so
only because the law permits him to appropriate all the slave
produces. The substitution of the State for the individual master does
not deny the economic substance of slavery, even though the State
cloak its appropriations with eleemosynary intent; the individual
master also takes care of "his people." The primary right of
the individual to life is denied when his right to the possession and
enjoyment of the fruits of his labor is denied; he who may not own may
not be. And it is foolish to talk of a sovereign people without the
right of property.
The Poor and the Rich
In the beginning, income taxation was eased into our mores by its
promise to "soak the rich." It flattered what the people
were pleased to call their sense of justice, which was only envy.
Their concern was with tearing down, not with moral principles.
The opponents of the Sixteenth Amendment were equally devoid of
principle, for they were quick to make compromise, since the first
levies were low and the exemptions high As was inevitable, the
exemptions were regularly lowered and the levies increased, so that
income taxation now falls most heavily on those least able to bear the
burden. This consequence was unavoidable simply because political
power is incapable of self-restraint and stops short only when
confronted with vigorous social opposition. Since its power is in
direct ratio to its income, the State could not overlook the pockets
of the poor; the poor are the largest segment of the population and
their aggregate income is the most attractive target of spoliation. "The
Congress shall have the power," says the amendment, "to lay
and collect taxes on incomes from whatever source derived . . "
-- and in that italicized phrase rests the unlimited power of
appropriation; nothing and nobody are exempt, neither the incomes of
the poorest nor the incomes of gamblers, thieves and prostitutes. It
is the unequivocal assertion of the State's lien on all the wealth of
the nation.
The passion for levelling that insinuated the Sixteenth Amendment in
the Constitution obscured the fact that this all-inclusive power of
appropriation must in time reduce the people to the condition of
wardship. Every strengthening of the State is accomplished by a
weakening of the moral fibre of the people. That is axiomatic. Just as
a bonded servant is dependent on the will of the master, so do people
deprived of their incomes acquire the habit of charity; they learn to
lean on the only propertied "person," the State. Dependence
on the State, by way of socialized education, "free"
medicine, unemployment insurance, public housing, gratuities and
subsidies of all kinds, becomes the normal way of living an4 the pride
of personality is lost. When self-reliance falls into disuse, it
atrophies.
Moral deterioration is a progressive process. Just as a worn part
will affect contiguous parts and bring the entire machine to collapse,
so the loss of one moral value must ultimately undermine the sense of
morality. The income tax, by attacking the dignity of the individual
at the very base, leads to the practice of perjury, fraud, deception
and bribery. Avoidance and evasion of the levies have become the
passion of the country, and talents of the highest order are expended
on trying to save something from the clutches of the State. People who
in their private lives are above reproach brag about their ingenuity
in beating the law. Putting all the tax-evasion devices together, they
come under the head of lying; sometimes it is legal, sometimes it is
illegal, but always it is evasion of the truth. The habit of lying
grows by the practice, and a people constantly on the alert for an
effective lie in the making up of their income tax reports must in
time put little worth on truthfulness as a whole.
The political concept of a sovereign people, capable of
self-government, rests on the assumption that tie people are possessed
of integrity, if not wisdom, and that they are free to make choices in
the light of their understanding. But, a people inured to deception by
the necessity of living are not likely to heed moral principles in the
management of their common affairs; nor does freedom of choice have
any meaning if the best they can expect from the management is a
gratuity from their confiscated property. The sovereignty of the
people is rather tarnished by their willingness to trade their
conscience; a "bought" election is hardly the free
expression of an independent people.
Yet, nothing else can be expected; income taxation must produce a
slave psychology. One must live. Since the source of doles, subsidies,
jobs and economic favors of one kind or another is the tax-fund, the
party in control of it is their natural "choice," while the
best the "outs" can do is to promise a more lavish
distribution and hope that the promise will carry weight at the polls.
That consequence of the Sixteenth Amendment was unavoidable. If ever
there was any validity to the concept of a sovereign citizenry, from
whom the powers of government are derived, there certainly is none
now.
The Rationale of Robbery
Consciously or instinctively, the proponents of home government (or
States' Rights) proceed from a philosophical axiom, that the
individual is the only reality. He alone exists. Without him there
cannot be a society, and without society there is no need of
government. Society, in fact, is nothing but a convenient abstraction,
a word describing an agglomeration of individuals cooperating for
their mutual advantage. The character of society is but a composite of
the characters of its components; it has no other. In short, society
is nothing of itself.
For the purposes of society -- that is, the improvement in the
circumstances of its membership -- experience has shown the need of an
umpire. Since all the members are assumed to be possessed of the right
to do whatever they please, provided they do not transgress the equal
rights of others, it is necessary for society to provide a means of
preventing transgression or of effecting restitution when it occurs.
We give government a monopoly of coercion so that it can prevent
coercion.
On the record, however, the government, which must consist of
fallible human beings, is too often inclined to use the power vested
in it for purposes not consistent with its appointed duty; it
frequently goes in for a bit of predatory activity in the interests of
its own members or of favored citizens. The only preventative is
constant surveillance. There is no known "system" that will
automatically keep the governing committee in line with its social
mission.
This problem of surveillance presents a physical difficulty. The
business of the members of society is the production of goods and
services; this is demanding enough and leaves little time or energy
for the supervision of government. It is necessary, therefore, that
government be kept within reach, small, and completely dependent for
its keep on the will of the body it serves. If it engages in
activities too complicated for the citizens to follow, if it assumes
to be an active agency as well as an impartial umpire, or if it
achieves economic independence at the expense of the citizens, it will
surely get out of hand; in that case it must become a burden and a
hindrance. The evidence of history supports the conclusion that
simple, small and dependent government is the only kind that can be
watched and held to its social aim.
That, in a nutshell, is the reasoning behind the home government idea
-- or the American doctrine of States' Rights.
The income tax proceeds from, or finds justification in, quite the
opposite premise, namely, that society is not only an entity distinct
from the individuals composing it; but is endowed with capacities and
qualities superior to anything the individuals can lay claim to. The
collectivity may be a merger of individuals; still, the merger is a
thing in itself, with a character of its own. This artifact of man is
greater than its maker.
Once the fiction of a separate and superseding society is accepted as
fact, logic has no difficulty in marching directly to the income tax
and to the interventions that follow in its wake. In the first place,
the fictional premise liquidates the doctrine of "natural rights"
-- of immunities inhering in the individual. That doctrine, say the
collectivists, is an unprovable assumption; actually, they point out,
the individual exists only within the framework of society. He is like
part of a machine, necessary to its operation, but replaceable and
therefore of consequence only as an accessory. The whole is greater
than the sum of its parts. As a matter of experience, they say, what
we call rights are merely the liberties that society (acting through
its managing committee, the government) deems it advisable, in its own
interests, to permit the individual to enjoy; when society finds the
exercise of these liberties inconsistent with its purposes, it is
entirely justified in withdrawing them. There are no immutable
immunities.
Particularly is this so in the case of property. The individual may
not lay claim to what he produces simply because he produces nothing
by himself. Society produces everything; the more integrated the
society, the greater the subdivision of labor, the greater the total
production and the greater the dependence of the individuals on the
collectivity. It follows from this line of reasoning that society
alone has a vested interest in all production, and what the individual
obtains through the system of wages and profits may be appropriated at
will; he holds it in trusteeship only. The judgment of the governing
committee as to what part he may keep for his own consumption cannot
be questioned.
Thus we have the rationale of the income tax, if one is needed; in
point of fact, the political establishment does not go in for
rationalization, but exercises its power of confiscation on the basis
of law and custom. But, the argument is implied not only in the
confiscation but also in the government's assumption of duties and
functions made possible by the confiscation. First comes the
confiscation under cover of law; with confiscation comes power, or the
means of employing policemen (as well as publicists and lawyers) to
compel or induce people to do that which they would not do if left
alone and in possession of their wealth; power feeds on power, and so
we have the Welfare State, or the complete denial of the sanctity of
the individual and the glorification of the amorphous god, State. The
rationalization comes long after the fact of power has been
established. It is the moralization of theft. It is the
self-glorification that makes it easier for the thief to enjoy his
loot and facilitates further looting. It is the justification for the
exercise of power.
Open Sesame for Absolutism
Subtly implied in the Welfare State idea -- in the intervention in
private affairs made possible by the confiscation of wealth -- is the
concept of inferior and superior orders of men. Those who are in
position of power are there because of either innate capacities or
special training, or both, and are thus destined to look after the
vast majority not so qualified. This is a modernization of
noblesse oblige, with very little noblesse. In this
country we have not got around to identifying the rulers with titles
of nobility, but the public mind is fast becoming inured to the
distinction between bureaucrat and taxpayer, between an aristocracy'
of power and a subject people. The inurement was facilitated by
constitutional methods, by strict adherence to the forms prescribed
for limited government. Nevertheless, the division of American society
into ruled and rulers is as real as if it had been accomplished by
conquest. The will of the people had to give way to economic
necessity, and as the habit of begging for handouts grew so did the
importance of the benefactor. We have come by absolutism quite without
realizing it.
That the income tax was bound to transfer sovereignty from the people
to a ruling class is seen when we look into the economic nature of the
levies. It is not, as the title infers, a tax on earnings; it is a tax
on that part of the earnings that might have become capital.
Obviously, the State does not take what the earner consumes; it takes
what he might have saved. Savings become capital, things used in the
production of consumable wealth, like machines, railroads, buildings.
The more savings thus invested the larger the capital structure of the
community, and the larger the capital structure the greater the
abundance of things men live by. What the State takes thus lowers the
total productive capacity and, consequently, the standard of living.
Dependence on the State follows as a matter of course.
Nor is this conclusion refuted by the claim of those who advocate
State-capitalisin, namely, that the State employs the savings just as
the individual would have done. The primary purpose of the State is
the retention and extension of its power, not the production of
things; in the latter field it simply has no competence. The
individual capitalist is compelled by the marketplace so to employ his
capital that the consumer will buy its products at a price that yields
him at least the amount of capital consumed in production. The private
capitalist must render a desirable service or lose his capital. The
State is under no such compulsion. If it puts the confiscated capital
to productive uses it does so for purposes of political power; it is
monopolistic by its composition, and if what it produces does not meet
with public favor the public has no recourse; you cannot take your
letters to a competing postal service if the State's is
unsatisfactory. The price charged by the State does not include all
costs, including depreciation of capital, for it can compel the
consumer, through taxation, to make up operational deficits.
Deficits are characteristic of every venture in State-capitalism; so
much so that the State is compelled to explain them away; every
deficit, the Statists assert, merely represents an additional "public
service." It is not correct, therefore, to compare a Post Office
Department or a Tennessee Valley Authority with a capitalistic
venture. These are not businesses, but are political institutions.
Whatever "services" they do render are not what we demand of
free capital State-capitalism is nothing but the use of what might
have been capital to increase the power of the State over men.
The Great Moloch
In this country, the State has got around to appropriating
approximately one-third of the total production, with the promise of
more to come It has, therefore, become the largest single employer of
labor, the largest single purchaser of goods. Its continuing
absorption of what could otherwise become capital reduces the number
of opportunities for self-employment. Under the circumstances, men are
compelled to turn to the State for sustenance, and by the subtle
process of adjustment to look upon it as their benefactor and guardian
angel. Its predatory character is lost in the pyramids it builds, in
the monstrous works for which there is no economic need and which
serve only to advertise its greatness and its goodness. The
disposition of men to resent political power is thus envervated.
Sovereignty is thrust upon the State.
Well, then, since the commonality in America has accommodated itself
to the doctrine of absolutism, what reason is there to raise
objection? Only this, that in the long run the general economy must
decline with the wastage of potential capital, and with the lowering
of the economy comes a loss of aspirations and the loss of human
values.
There is one ineluctable fact of human behavior that Statism cannot
overcome: men labor only to satisfy their desires. They do not work
for society, they work for themselves; there is no way of
collectivizing desires. If for their exertions they get mainly
monstrous dams and propaganda books, things they would not make of
their own accord, their interests in laboring diminishes. The futility
of it all dampens their aspirations. A meal and a mate they must have,
but the marginal satisfactions, the things they can get along without,
like baseball and Beethoven, are dropped in the difficulties of
acquiring them. The values are lost. If the State, in its own
interests, does supply these marginal satisfactions -- the Roman State
provided circuses as well as bread -- the sense of achievement that
heightens enjoyment is gone; one takes what is given, asks for more,
but there is no appetite in it. The loss of interest in effort, in
self-expression, is the mark of a declining civilization. And that
eventuality the State cannot prevent.
If this is what follows from the channelling of the wealth of the
nation into the political establishment, then true patriotism dictates
an effort to put a stop to it. The repeal of the Sixteenth Amendment
is the one thing we can do to save America from the dust-pile fate of
other civilizations. That alone will decentralize and weaken the
American State -- and set up government again.
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