Income tax unconstitutional?

[aH0tUnicorn]

Income tax appears unconstitutional to me. 

The 13th amendment abolishes involuntary servitude. Income tax is involuntary servitude. The counterargument to that is citizens are not required to labor. If I don't labor, I am forced into a situation where it is much harder to survive, a cruel punishment for not laboring, a violation of the 8th amendment. Citizens are therefore given a choice, involuntary servitude or cruel punishment.

The counterargument to this is income tax is irrelevant because you would have involuntary servitude or cruel punishment regardless of the tax. That is a burden of life itself however, being born into this world, and not a burden put onto me by the government, the government didn't create me.

How am I wrong?

[sgpunk]

Hi aHOTUnicorn, unfortunately, I'm not the most knowledgeable person to answer your question but I came across the "de-tax movement" in the past. I tend to believe everything they said but my memory is fuzzy. Also, some people says theses movements are a scam and I don't know who to believe. I've been deceived before so I'm very much skeptical of everything now... even probably life-changing good 

I can give you some link if you want to look it yourself.

I remember discovering de-taxing from 
https://www.securecreditor.com/ (she has a youtube channel also)

But since I'm canadian I was refering to http://www.detaxcanada.org/.

 

I know thoses two are fill with statements and reference. I hope you will find what you are looking for.

[Tyler H]

I hate to break it to you, but the man doesn't give a fascist fart what that piece of paper says.

[Dylan Lawrence Moore]

The best part is that federal income tax doesn't actually pay for anything. It just removes money out of the system.

[Tyler H]

7 hours ago, Dylan Lawrence Moore said:

The best part is that federal income tax doesn't actually pay for anything. It just removes money out of the system.

What do you mean? I thought they used it to pay the interest on the national debt. If they just used it to remove money from the system then wouldn't we have significant deflation?

[Erwin]

1 hour ago, Tyler H said:

What do you mean? I thought they used it to pay the interest on the national debt.

I think he means that the payment is fiscally meaningless at this point. It's like ordering a triple big mac combo (gov spending) but with a diet soda (interest payment)...

1 hour ago, Tyler H said:

If they just used it to remove money from the system then wouldn't we have significant deflation?

Well yes but you also have to consider how much money the pump in and how much resource scarcity taxes create. 3 QEs, 15 years of negative interest, 100 years of artificially low reserve requirements, the myriad of taxes and regulations, generous government services...

[Dylan Lawrence Moore]

2 hours ago, Tyler H said:

What do you mean? I thought they used it to pay the interest on the national debt. If they just used it to remove money from the system then wouldn't we have significant deflation?

Nope. Been learning this in MMT. Because the federal gov't creates money out of nothing, it can't be in debt. The "debt" of the federal government is just the amount of net private sector savings in the system. The purpose of taxes is to give the money value to begin with.

[Erwin]

1 hour ago, Dylan Lawrence Moore said:

The purpose of taxes is to give the money value to begin with.

Did you mis-word this? It sounds like you're saying that without taxes, money has no value...

[Dylan Lawrence Moore]

30 minutes ago, Erwin said:

Did you mis-word this? It sounds like you're saying that without taxes, money has no value...

Precisely.

[Tyler H]

3 hours ago, Erwin said:

Well yes but you also have to consider how much money the pump in and how much resource scarcity taxes create. 3 QEs, 15 years of negative interest, 100 years of artificially low reserve requirements, the myriad of taxes and regulations, generous government services...

I thought I read that 90% of the new money replaces old bills and they print about 350B a year. So even with QE1-x it doesn't seem like enough to outweigh the multi-trillion dollar tax revenue... but I did forget about the interest rates and credit expansions, that could certainly explain it...

[Erwin]

5 minutes ago, Dylan Lawrence Moore said:

Precisely.

Do we disagree on the definition of value?

By value I'm using the economics sense of the word, i.e. whatever you are willing to give up to get something. Is this the same definition you're working with?

[Erwin]

4 minutes ago, Tyler H said:

I thought I read that 90% of the new money replaces old bills and they print about 350B a year. So even with QE1-x it doesn't seem like enough to outweigh the multi-trillion dollar tax revenue... but I did for get about the interest rates and credit expansions, that could certainly explain it...

I would think so.

350B is measured as the M1 definition of money. It doesn't include all the credit created from it.

[Dylan Lawrence Moore]

23 minutes ago, Erwin said:

Do we disagree on the definition of value?

By value I'm using the economics sense of the word, i.e. whatever you are willing to give up to get something. Is this the same definition you're working with?

Why are you willing to give up time and real resources for otherwise useless pieces of paper and digital representations of those pieces of paper?

[Tyler H]

8 minutes ago, Erwin said:

I would think so.

350B is measured as the M1 definition of money. It doesn't include all the credit created from it.

Right. 

2 hours ago, Dylan Lawrence Moore said:

The purpose of taxes is to give the money value to begin with.

Isn't it the threat of force behind the currency that gives it "value"? I.e. You can avoid negative impositions by forking over a portion of the products of your labor. Even without taxation they force the populace to accept the paper as legal tender, so isn't it the coercion, not the specific function of taxation, that creates the "value"?

[Dylan Lawrence Moore]

12 minutes ago, Tyler H said:

Isn't it the threat of force behind the currency that gives it "value"? I.e. You can avoid negative impositions by forking over a portion of the products of your labor. Even without taxation they force the populace to accept the paper as legal tender, so isn't it the coercion, not the specific function of taxation, that creates the "value"?

The threat of force is the threat of taxes. You must pay taxes in US dollars in the US.

When I start talking about MMT, I think people freak out because they think I'm saying that there isn't a scam. There is a scam, we've just identified it wrong.

What people think traditionally: the government needs to take money from people in order to be able to pay for things with taxes.

What it actually is: the government needs to demand taxes in order to give value to the money it made up.

When the government demands taxes in legal tender (i.e. money it made up), the only place to get that money is from the government itself. Thus the government is able to buy things, which in reality is a violent transfer. 

Because the government can literally infinitely create money (it's not a real resource--it's made up), by definition it cannot be in debt. The federal government neither has or doesn't have money. This is why paying taxes takes money out of circulation and federal spending puts money into circulation. The fact that it's called "debt" is a misnomer which has been very successful into confusing people (including me) into falsely identifying the problem.

Thus, to come back to my original comment, because federal taxes don't actually pay for anything (they just remove money out of the system), it's an extra-hard forehead slap to have to be forced into a discussion about its constitutionality.

[Erwin]

49 minutes ago, Dylan Lawrence Moore said:

Why are you willing to give up time and real resources for otherwise useless pieces of paper and digital representations of those pieces of paper?

It is used as a medium of exchange, & unit of account, therefore it is - by definition - not useless. I am willing to give up time and real resources for currency to exchange it with other people's time and real resources.

_________________________________

Regardless, it seems like we agree on the definition of value, which is great. Let's follow your premises to their logical conclusions:

Premise a) Money has value because it is taxed

1. Therefore, increasing taxes increases the value of money

2. Therefore, as taxes approach 100%, the value of money approaches infinity

Premise b) The value of money is simply whatever you are willing to give up for it

1. As taxes approach 100%, the less money you get

2. Therefore, as taxes increase, the less willing you are to give up for it, therefore less value

3. Therefore, as taxes approach 100%, the value of money approaches 0

The conclusions of premise a) and b) are the exact opposite of each other. Therefore, both cannot be true. And with that, I ask you: are you willing to give up your premise a) or your premise b) ?

[Dylan Lawrence Moore]

25 minutes ago, Erwin said:

It is used as a medium of exchange, & unit of account, therefore it is - by definition - not useless. I am willing to give up time and real resources for currency to exchange it with other people's time and real resources.

_________________________________

Regardless, it seems like we agree on the definition of value, which is great. Let's follow your premises to their logical conclusions:

Premise a) Money has value because it is taxed

1. Therefore, increasing taxes increases the value of money

2. Therefore, as taxes approach 100%, the value of money approaches infinity

Premise b) The value of money is simply whatever you are willing to give up for it

1. As taxes approach 100%, the less money you get

2. Therefore, as taxes increase, the less willing you are to give up for it, therefore less value

3. Therefore, as taxes approach 100%, the value of money approaches 0

The conclusions of premise a) and b) are the exact opposite of each other. Therefore, both cannot be true. And with that, I ask you: are you willing to give up your premise a) or your premise b) ?

Only a was my premise. Furthermore:

a.1 does not necessarily follow from a. Just because taxation gives money value to begin with, that doesn't mean further increases in taxes correlate to further increases in value of money.

I never said b.

[Erwin]

6 minutes ago, Dylan Lawrence Moore said:

I never said b.

Then let's back up for a second. This was our dialogue:

2 hours ago, Erwin said:

Do we disagree on the definition of value?

By value I'm using the economics sense of the word, i.e. whatever you are willing to give up to get something. Is this the same definition you're working with?

Your response:

1 hour ago, Dylan Lawrence Moore said:

Why are you willing to give up time and real resources for otherwise useless pieces of paper and digital representations of those pieces of paper?

The purpose behind my willingness to give up time and resources for money is irrelevant to our conversation if we do not agree on a definition of value.

So I ask you again: what is your definition of value?

[thebeardslastcall]

Talking about the constitutionality about something that's been going on for over a century seems to miss something critical. This isn't a nation based on a constitution, as that was long ago abandoned, and the constitution is merely paraded about on occasion to make an excuse for some judge or lawyer to have their way when they mean to further degrade people's freedoms. Any appeal to the paper word, of little worth, must be made quickly or it's revealed to be a farce.

Lots of laws and current actions are unconstitutional. Being unconstitutional alone doesn't hold enough sway to invalidate them. If the system were valid that would be all you'd need, but you need more to make changes. So while you may not be wrong, the relevancy of any such arguments has already been nullified. You need a new argument, or really, a new law passed by politicians, to get rid of the income tax, and they're not inclined to do that anytime soon because people aren't demanding it. As awful and illegitimate as the government is, many people still consider it legitimate as to try to use the ring of power, which is why it survives in its currently ugly and heavily contested form.

[Dylan Lawrence Moore]

8 hours ago, Erwin said:

The purpose behind my willingness to give up time and resources for money is irrelevant to our conversation if we do not agree on a definition of value.

Your willingness to give up time and resources for money is because the government demands that money for taxes, thus giving it value. Our agreement is what's irrelevant.

Value: the usefulness of something.

 

[Erwin]

14 hours ago, Dylan Lawrence Moore said:

Your willingness to give up time and resources for money is because the government demands that money for taxes, thus giving it value. Our agreement is what's irrelevant.

Value: the usefulness of something.

 

Agreeing on the definition of value is very relevant. Now, I finally know what you are talking about and we can have completely different discussion.

Using your definition of value:

Premise: money has no utility unless it is taxed.

Does your premise apply only to money or all things?

[Dylan Lawrence Moore]

On 5/10/2017 at 0:17 PM, Erwin said:

Agreeing on the definition of value is very relevant. Now, I finally know what you are talking about and we can have completely different discussion.

Using your definition of value:

Premise: money has no utility unless it is taxed.

Does your premise apply only to money or all things?

 Our agreement is irrelevant to the usefulness of money. It is being used regardless of our agreement of its value.

 

Premise 1: Money by itself has no use.

(Example: if I printed a $100 bill off my computer, it would not be worth $100. It would just be a piece of paper with some ink.)

Premise 2: Government demands money to pay for taxes.

Premise 3: Government demand creates use for money.

Premise 4: Use creates value.

Conclusion: Money has value because it is taxed.

 

[Erwin]

3 hours ago, Dylan Lawrence Moore said:

 Our agreement is irrelevant to the usefulness of money. It is being used regardless of our agreement of its value.

I didn't say it is relevant to the usefulness of money. I said it is relevant to having a conversation. I can't talk about something if I don't know what it is... That's why I was asking.

3 hours ago, Dylan Lawrence Moore said:

Premise 1: Money by itself has no use.

(Example: if I printed a $100 bill off my computer, it would not be worth $100. It would just be a piece of paper with some ink.)

Premise 2: Government demands money to pay for taxes.

Premise 3: Government demand creates use for money.

Premise 4: Use creates value.

Conclusion: Money has value because it is taxed.

Ok, based on this I think that our disagreement is simply semantics. What you have described is - in economics jargon - referred to as currency, hence my confusion. By that definition, I totally agree with you.

I thought you were referring to the economics definition of money; fiat currency is - by definition - not money in econ jargon, but gold is. So, in my head, I thought we were arguing for the value of money like gold, and I was going to make the argument that "well, gold is useful but not taxed..."

I guess that settles it?

[Dylan Lawrence Moore]

What's the use of gold if it's not taxed?

[Erwin]

50 minutes ago, Dylan Lawrence Moore said:

What's the use of gold if it's not taxed?

In addition to the functions of economic currency (unit of account + medium of exchange), and economic money (store of value)?

Off the top of my head:

- hedge against tail risk

- gamma ray deflector

- one of the best electrical conductors

- makes steel more malleable

- jewelry

- dentistry

Edited May 13, 2017 by Erwin
EDITED: repellant to deflector

[Erwin]

same goes for silver and platinum, plenty of industrial use

[ofd]

Gold as money (as one medium of exchange) was used for a long time before it was used as currency. The first to use it as currency was Croesus who enforced the use of gold and silver as money as a means to pay taxes. He got famously rich because he already had large portions of silver and gold and could use coins to buy stuff with a mark up and pay his soldiers relatively cheaply. 

[Dylan Lawrence Moore]

12 hours ago, Erwin said:

In addition to the functions of economic currency (unit of account + medium of exchange), and economic money (store of value)?

Off the top of my head:

- hedge against tail risk

- gamma ray deflector

- one of the best electrical conductors

- makes steel more malleable

- jewelry

- dentistry

I see. Did ancient societies, like the Romans, use gold as money because it was valuable for these reasons?

[Tyler H]

5 hours ago, Dylan Lawrence Moore said:

I see. Did ancient societies, like the Romans, use gold as money because it was valuable for these reasons?

The Egyptians used it for jewelry as far back as 5000 BC. Because it was rare and wouldn't corrode it was desired by rulers as a symbol of their power and immortality. I could see how this alone could give gold its value, and combined with its distinguishable and fungible characteristics it makes sense that it would emerge as a favored medium of exchange. 

[morem7]

On 4/23/2017 at 4:55 PM, aH0tUnicorn said:

Income tax appears unconstitutional to me. 

The 13th amendment abolishes involuntary servitude. Income tax is involuntary servitude. The counterargument to that is citizens are not required to labor. If I don't labor, I am forced into a situation where it is much harder to survive, a cruel punishment for not laboring, a violation of the 8th amendment. Citizens are therefore given a choice, involuntary servitude or cruel punishment.

The counterargument to this is income tax is irrelevant because you would have involuntary servitude or cruel punishment regardless of the tax. That is a burden of life itself however, being born into this world, and not a burden put onto me by the government, the government didn't create me.

How am I wrong?

As written (not as enforced), the US income tax is NOT unconstitutional because when one reads the ACTUAL laws, the income tax applies to very few. For a definitive guide to the US income tax see Dave Champions book "Income Tax: Shattering the Myths" http://www.incometaxtruth.com/. For example, most

"americans" are NOT "US Persons" as defined in the tax code...

[Dylan Lawrence Moore]

On 5/13/2017 at 0:36 PM, Tyler H said:

Because it was rare and wouldn't corrode it was desired by rulers as a symbol of their power and immortality. 

 

This sounds eerily similar to the concept of taxation to me.

[Erwin]

3 hours ago, Dylan Lawrence Moore said:

 

This sounds eerily similar to the concept of taxation to me.

Well... your logical reasoning is correct, but your conclusion is very unsettling because we keep having to remind ourselves that "oh... right... by value he means utility"

Why use a different jargon than the convention? It just creates confusion and the need to explain more...

[Dylan Lawrence Moore]

12 hours ago, Erwin said:

Well... your logical reasoning is correct, but your conclusion is very unsettling because we keep having to remind ourselves that "oh... right... by value he means utility"

Why use a different jargon than the convention? It just creates confusion and the need to explain more...

 

I'm not sure what the jargon is that you're talking about. Not that it has to be, but money is a state-created phenomenon. Furthermore, it's an abstract concept, not a objective object. It chooses a material (gold, silver, tally sticks, notes, digital numbers, whatever) to demand as taxes, and legally defines the nature of that material to demand. This is what turns it into money. Gold wasn't money before the state came around. The state came around, demanded gold, and thereby turned it into money.

This is important to note, particularly in relation to federal income tax, because as I mentioned above, it doesn't pay for anything. Particularly since there is no physical resource that the money is tied to, the government can create or destroy money at will via spending and taxation. Federal taxation is a method of removing money from the economic system, NOT a method of financing.

Thus when I say that this is the "best part", I'm being sarcastic because the government could literally delete the IRS and still pay for everything it does just fine.

[HasMat]

On 5/12/2017 at 6:14 PM, Erwin said:

same goes for silver and platinum, plenty of industrial use

I think what Dylan Lawrence Moore is saying is that invented money gains value by violence. QE only has value because its backed by govt violence, not because people suddenly voluntarily accept counterfeiting by others. (and then of course its fungible and not trackable)

 

Regular money has social value by individual consent. (your premise b)

 

Deeper than that, I think he is saying that non-gold backed invented money is a fantasy like invented bitcoin. It has no intrinsic value, except what individuals consent into it, as buy-in to it as a medium. When a money has no intrinsic value (bitcoin or US$), but its acceptance is driven by the threat of violence, then its value is largely the manufacture of violence.

 

The value of a bitcoin is derived by the community of people who value it. US$ doesn't have a community of people who "fully" voluntarily value it. So while they do "coerced" voluntarily value it, its actually post fact to the violence. You cannot use other legal tender. I think it says this on dollars. It's a compulsory unit of social exchange.

 

US$ are compulsory (as medium of exchange), not gold-backed, and is being counterfeited by the US govt.

 

The reason its valued by individuals is largely the result of violence, but there is a vaneer of voluntary valuation too.

 

To say US$ have value solely because of taxation is oversimplifying the various methods of violent control over the money supply. Additionally, individuals value it, even if while under unconscious duress.

[Dylan Lawrence Moore]

7 hours ago, HasMat said:

Deeper than that, I think he is saying that non-gold backed invented money is a fantasy like invented bitcoin. It has no intrinsic value, except what individuals consent into it, as buy-in to it as a medium. When a money has no intrinsic value (bitcoin or US$), but its acceptance is driven by the threat of violence, then its value is largely the manufacture of violence.

I'm saying that even gold-backed money is invented and gains its value from violence. Prior to the modern era where we found out gold was useful for computers, electronics, and other scientific reasons, what was the intrinsic value of gold? The best answer I ever get out of anyone was that it was used for jewelry or that it was shiny. Tyler H nailed it when he said that rulers demanded it (for whatever reason). This demand is what gave it its value.

 

7 hours ago, HasMat said:

The value of a bitcoin is derived by the community of people who value it.

 

I would argue that BTC is valued by the people who trade it. In the same way that the gov't creates value for USD by demanding it for their "services", BTC gains its value because you must use it for services that send, buy, and sell it. The difference of course is the presence of violence. If I don't use BTC to pay for BTC services, no one cares. If I don't USD to pay for taxes, I run into problems.

7 hours ago, HasMat said:

US$ are compulsory (as medium of exchange), not gold-backed, and is being counterfeited by the US govt.

I always hear this term "counterfeit" when it comes to the US govt creating money. If the US govt has the right and obligation to create money via the constitution, how is any money they create counterfeit? Again, it doesn't matter what the money is made out of it, it's the demand for taxes which gives it its value.

7 hours ago, HasMat said:

To say US$ have value solely because of taxation is oversimplifying the various methods of violent control over the money supply. Additionally, individuals value it, even if while under unconscious duress.

The USD has value essentially on its taxation. If it wasn't taxed we would find something else to use. Additionally, there are many things to buy with USD. The US, having been the most free and prosperous nation on earth, created a lot of stuff that we're able to buy. Venezuelan money, for example, won't buy you much despite the government demanding it in taxes, because there is simply nothing purchasable within the govt's jurisdiction.