“Observations”
by: Donald S. Conkey
Date: November 30, 2007 - # 946a – Doctrine of “Soak the Rich” (807)
Do anyone remember when and how the popular
political taxation doctrine, “Soak the Rich,” originated? This doctrine of political science has been used throughout
the centuries to politically divide the haves from the have nots, often leading to the self-destruction of prosperous nations.
The current use of this
doctrine began in 1909, almost a hundred years ago, not as a direct assault on the rich, but evolving from a prank initiated
by Alabama Senator Joseph W. Bailey, a conservative southern democrat, to embarrass the republicans in Congress. (Politics
seem to change little over time.)
Prior to Bailey’s prank the federal government raised the needed funds to pay its bills by the method outlined
in Article 1, Section 8 of the Constitution. This section reads: “Powers
Delegated to Congress: Enumerated powers: 1. The Congress shall have power to lay and collect taxes, duties, imposts, and
excises (sales taxes), to pay the debts, and provide for the common defense and general welfare of the United States; but
all duties, imposts, and excises shall be uniform throughout the United States;....” No income tax was intended and
all taxes were to be ‘uniform.’
But Bailey’s prank got out of hand and the events that followed dramatically altered the Constitution of the
United States and created the current tax system, a system as destructive as the ‘taxation without representation’
policies of King George III that led the Founders to declare their independence from England in 1776.
Ironically Senator
Bailey, strongly opposed to income taxes, decided to embarrass the republicans, then in power, by forcing them to openly oppose
an income tax bill he introduced. He fully expected his tax bill to be defeated. But republican liberals supported Bailey’s
bill giving it the votes necessary to pass.
Unable to defeat
the bill congressional leaders panicked and introduced a ‘Constitutional Amendment’ hoping it would be defeated
by the states. But when the slogan “Soak the Rich” was attached to the amendment it swept the country and was
quickly approved as the Constitution’s 16th Amendment. This
“Soak the Rich” slogan has been the rally cry for democratic tax policy ever since. Incidentally the 16th
Amendment nullified the 4th Amendment “against unreasonable searches and seizures.”
The 16th
Amendment, ratified in 1913, reads: “The Congress shall have power to lay and collect taxes on incomes, from whatever
sources derived, without apportionment among the several states, and without regard to any census or enumeration.” The ‘income tax doors’ were opened – never to be closed again.
But the super-rich
were never soaked, only the middle-class. They, the super-rich, inserted a clause into HR 3321 before it passed 1n October
1913 that allowed them to protect their wealth by creating charitable foundations. This clause reads: “Provided, however,
that nothing in this section shall apply ... to any corporation or association organized and operated exclusively for religious,
charitable, scientific, or educational purposes.” “Pork Legislation” followed in 1936 when the Supreme Court
ruled on the ‘general welfare’ clause in Article 1, Section 8.
Today many wonder
if the elections of 2008 will bring fulfillment to Alexander Tyler’s 1796 prophesy that stated “A democracy cannot
exist as a permanent form of government. It can only exist until a [a majority of] of the voters discover they can vote themselves
largesse [pork] from the public treasury. From that moment on the majority always votes for the candidate promising the most
benefits from the public treasury, with the result that a democracy always collapses over loose fiscal policy [taxing the
rich and excessive spending].... The average life of the world’s greatest civilizations has been only two hundred years.”
Today’s
candidates for the presidency, especially those in one party, seem to be trying to outdo their opponents in how much they
can promise the voter – an entitlement here, another there. And they propose to pay for their new entitlements by “Soaking
the Rich,” a method totally contrary to the original intent of the Founders.
Even sadder than this scenario is that so many Americans are buying into this freedom-destroying false doctrine. They unwittingly
are buying into a program that will kill the goose [free enterprise – the freedom to try, the freedom to buy, the freedom
to sell, and the freedom to fail] laying those golden eggs that create the new businesses and the new technology necessary
for the creation of new jobs.
If those seeking
public office are elected by promising to “Soak the Rich” to pay for more government run-entitlements they will
be doing Americans a disservice, rich and poor alike. There will no winners. The communists tired it. They failed leaving
their poor totally devastated.
Destroy America’s Golden Goose by “Soaking the Rich” and you destroy America by destroying the incentive for those willing to work 18 hour days to make their dreams come true – and provide
jobs for us average Americans.
