Abolish Income Tax

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(Un)happy Birthday, Fiat Money
by Jordi Franch on August 15, 2011

Forty years ago today, on the morning of Sunday, August 15, 1971, the US president, Richard Nixon, declared the inconvertibility of the dollar into gold.[1] The 20,000 tons of the yellow metal deposited in Fort Knox in 1944 had decreased substantially due to the high military costs of the Vietnam War. The United States — the leading global economic power — could not honor its financial commitments.

As a result, the Bretton Woods system officially ended, and the dollar became a fully fiat currency, backed not by gold but by the promise of the government.

This meant the end of a historical and monetary rule that, from the dawn of civilization, had made money a general medium of exchange and also a store of value. It began a new era of historical abnormality — that of fiat currency and central-bank monopoly, where the ability to provide credit and financing becomes as boundless as the production of legally enforced paper printed by the issuing bank.

With the burial of the last vestiges of the gold — that “barbarous relic” of the past, in Keynes’s words — the annoying limitation on the creation of money and credit was broken. Human needs, as well as political demands mobilized through democratic majorities (and minorities), are infinite.

Why stop spending? Why sacrifice immediate pleasures? The new fiat currency, devoid of intrinsic properties, releases governments from their commitment to convertibility, granting unlimited powers to the rulers of this statist system. With the burial of sound money, Keynes stands as the prophet of a new era of enjoyment and excitement under the new gospel of spending. Fiat money helps to remove the link between production and consumption, contributing to the delusion that the ineradicable scarcity of capital has been abolished.

The central banks can now print any amount of money. The dollar, which functions (so far) as the international currency, acquires real goods without offering anything in return. Of course, some holders of dollars are hard workers who, integrated within the structure of production, contribute to society with the provision of real goods and services. But there are also the politicians and bureaucrats — a completely different class of people.

This parasitic class weakens the productive class (and also manipulates production through public spending). At the moment, the European Central Bank is monetizing the debt of the peripheral European countries, diverting real resources from entrepreneurs in order to finance the wasteful activities of governments. It’s totally outrageous, morally unjust, and economically ruinous. It’s just one more road to serfdom.

Fiat money attempts the miracle of turning stones into bread or, rather, of exchanging paper for cars, electrical appliances, and luxury clothing. It’s the wonderful feeling of spending and consuming without the necessity of producing. Through fiat money, the richest and most powerful countries have also become the most indebted.

Unlike the 19th century, when the dominant power (Britain) accumulated surpluses, and the emerging nations ran into debt, now just the opposite happens. The United States’ external deficit and his twin brother, the public deficit, absorb the bulk of world savings, while emerging countries, most remarkably China, lend to them. And it seems that China — the largest single holder of US government debt, with more than 25 percent of all foreign-held US Treasury securities — is not resigned to stay passive while the value of its holdings is decreasing.

The United States — even when it was born in 1776 from a libertarian revolution against the arbitrary despotism of a British state that wanted to impose taxes without consultation — has in its DNA the genes of public spending and unlimited government growth. Today’s United States of America has nothing to do with those of Thomas Jefferson. The founding principles were forgotten a century ago with the creation of the Federal Reserve in 1913, the explosion of government spending, and the consequent increase in taxes and debt.

Conclusion

$15 $12

We can continue the journey started on August 15, 1971, or acknowledge that it was a tragic error of dire consequences.

Defenders of unlimited Leviathan advocate additional doses of quantitative easing and the creation of a single currency controlled by a world central bank.[2] Along this line, major central banks could take unified and oligopolistic action under the pretext of coordinating monetary policies. This would mean total disaster and the ultimate triumph of the system that has led to the current crisis.

The alternative is a return to sound money, a restoration of the true currency, spontaneous creation of the social order, and a rejection of the meddling of governments and central banks.

It is nonsense and a cruel hoax on small and medium sized businesses to be made to think David Cameron will be on their side.

So what can we do? There are many ways to fight back as the The Party Movement in America discovered. Putting up and voting for ‘small Government,’ low tax, pro business, libertarian candidates meant the Big Government Democrats lost control of the Senate to the Republicans. Not the ‘Big Government’ Republicans, (yes, there are just as many High Tax, Big Govt proponents in the Republican Party and the Conservative Party here as there are on the Left), but Small Government, fiscally responsible, ‘live within our means’, balanced budget Republicans like Senator Rand Paul son of the wisest man in American Politics, Congressman Ron Paul.

Consider that America contributes billions of dollars to shore up the Mubarak regime. Egypt is 2nd on the list of Foreign Aid contributions from the USA. Mubarak has been in power for 30 years ONLY because America finances his party.

We are entering a new era much like 1989 where most of the communist countries fell back into the hand of their rightful owners – the Socialists. Talk about out of the frying pan and into the fire. Repressed and bankrupted by communist party members then repressed and bankrupted by Socialist party members and their banking friends. The Arabian and African nations are rejecting the corruptive progressive influences and realising they are better on their own. I only wish them well and that they choose a Free Market system, not replacing one monstrous Government with another.

Egyptians must be left to choose their own futures. In many ways they are about to become freer than we are. We have no revolution and are still cowing to the whims of fraudulent bankers and politicians. Our revolution will not be on the streets, it will be fought in the accounting department. Withholding of taxes until politicians are purged of their corrupt ways by cutting off their access to our money forcing them to go and get real wealth creating jobs. The Government has no right to your money. They know it. They will do anything to scare you into believing they are in control. What is happening in Egypt, under a repressive monster, just goes to prove they absolutely are not.

There is little doubt amongst informed and open minded individuals that the access Government, Banks, and powerful Government friendly Corporations have to the Income Tax system is unacceptable, unhealthy and downright dangerous. Elections are now just about who gains control of the Tax Revenue we generate. Inevitably, they all spend it on their friends. To maintain control they have to saturate Tax Payers with endless propaganda via the Media so even the most balanced observer finds making a rational choice about our Worldly plight impossible. The Bombardment of Choice. The deed is completed and the allies make off with our tax proceeds or transfer their Debt to us.

We need to pay taxes on our labour, don’t we? We have to look after those who are more needy than us? The Banks need our money more than we do and we should not be so materialistic about them stealing from us and getting their accomplices to cover it up. Taxation without representation. The 18th century complaint that still prevails, therefore the instigators are still at large. The only bodies still in place from the 18th century are the Government, The Banks and the bureaucracy. We are still fighting for representation today, or rather we have given up fighting for it.  Even though it is not a life or death struggle anymore, merely a case of voting out those who stand for the State theft over personal freedom and liberty. The Tea Party in the US targeted and removed over 60 of the ‘Statists’ – those who find it easier, more profitable and completely risk free to live off the Tax Payer via subsidies, Government contracts and bail outs rather than venture out into the World you and I are thrust into. They have co-opted both Republicans and Democrats, Liberals, Labour and Conservative parties and speak of peoples fears about the economy and how injecting money into a failed financial system will bring us out of this. As if that has ever worked. A Bust is the healthy thing for the economy. Malinvestment and recklessness is punished and forward thinking and restraint is rewarded. The meek shall inherit and all that. Imagine an overweight person eating everything in sight during the time of plenty. A rational person would consider that the wrong thing to do. Imagine the overweight person then unable to afford all the cakes and chocolate and eating less and healthier. A rational person would consider this the correct thing to do. Yet our country and economy is run by consuming in the boom and refusing to diet in the bad times. So we are still overweight and unhappy.

So how can we hold the Statist profligates to account?

Firstly, our Self Assessment Tax form should contain 20 Government Spending headings with a space to write a percentage of between 0 – 100 as to the exact % you specifically state your Income Tax should be apportioned. Should you decide you want 0% to go on testing ‘Fertility in Dinosaurs’ then that is the amount the computer will read and allocate accordingly. The Politician’s and Bureaucrat’s hands will be bound from mischief by the chains of your desires and choices. It will become irrelevant which party the Government is from as they can only spend according to your confines. Your options when voting, and the battling parties representations will relate only to how efficiently they can allocate your resources. Their jobs depend on it. This is new territory for all involved. Imagine the scene where dozens, if not hundreds or thousands of effective, accountable, responsible administrators battle for the title of ‘The Finest Deliverer of Public Service’ in the nation? For it is only when resources are scarcest that Mother Invention shows her kindly face, at first disguised as Nanny McPhee. This is when people pull together. The point at which mutual interests collide in the name of productivity and wealth for all.

Secondly, taxes are reduced by half across all income groups. Not through any altruistic gesture of the Tax Lawmakers, but mostly because the population’s Tax Returns leave large sums unallocated and unspent. A Revolution in itself. The sky does not fall. Economies do not implode. Black Holes are neither created nor destroyed. All is peace and urgent purposeful action. Not the ‘Non’ Business of the ‘Business of Government’.

Thirdly, with divisive and deliberately wasteful spending and Political influence redundant, direct taxes on Citizens labour become redundant and outlawed permanently. The penalty for attempting to tax an individual’s labour carries the highest penalty. The true ‘End of the Age of Slavery and Serfdom’ begins and is celebrated, upheld by all as errors and misconceived notions are cast aside and freedom and true prosperity ensues.

‘If one rejects laissez faire (Free Market Capitalism) on account of man’s fallibility and moral weakness, one must for the same reason also reject every kind of  Government intervention (Central Economic Planning)..” Ludwig von Mises

One that the General Hard Working Tax Paying public won’t readily associate with the most disastrous Government since the last time Labour were in – back in the 70′s – man.

Ed Miliband was chosen over his brother because his brother, David, was too readily connected with Blair, Brown, Darling, 5 Wars, 900,000 dead Iraqi’s and Afghanis, 300 service personnel, a massive increase in State Control and Closed Circuit Surveillance of you, the people who pay for it all in the form of trillion pound deficits and borrowings that your Grandchildren will be thanking you for. Yes, Labour needs someone who will make them forget that Ed Miliband is the latest manifestation of the Leader who is there for one purpose and one purpose only. To fleece the tax payer and help transfer the money up to the giant Collectives and Corporatists who ensured he became Leader – Banks, Unions and Crony Capitalists in the Armaments Industry. These are not anything to do with true Free Market Capitalism, were people work hard, under consume and save. They emanate from the far left and are more akin to Marxists and Trotskyites in the ambition of perpetual revolution, both physical and intellectual, endless wars and no objection to endless welfare. Do not think that they are not the vast majority of Conservatives also. If you agree with the Central Bank of England, a ‘fiat’ paper currency and that Government planners can do a better job than Free Markets then you are at best ignoring the meltdown you have just witnesses and should join a socialist party.  Albeit, you want the Socialism for the very wealthy first.