New York Times columnist and leftist economist Paul Krugman, in a moment of candor, stated:
Eventually we do have a problem. That the population is getting older, health care costs are rising . . . there is this question of how we’re going to pay for the programs. The year 2025, the year 2030, something is going to have to give . . . we’re going to need more revenue. . . . Surely it will require some sort of middle class taxes as well. We won’t be able to pay for the kind of government the society will want without some increase in taxes . . . on the middle class, maybe a value-added tax. And we’re also going to have to make decisions about health care, not pay for health care that has no demonstrated medical benefits. So the snarky version, which I shouldn’t even say because it will get me in trouble, is death panels and sales taxes is how we do this.49
In addition to the financial burden and economic dislocation, the tax system and Internal Revenue Code have become so complex and oppressive that the federal government’s National Taxpayer Advocate reported in 2012, “U.S. taxpayers (both individuals and businesses) [spend] more than 6.1 billion hours to complete filings required by a tax code that contains almost four million words and that, on average, has more than one new provision added to it daily. Indeed, few taxpayers complete their returns without assistance. Nearly 60 percent of taxpayers hire paid preparers and another 30 percent rely on commercial software to prepare their returns.”50 Therefore, not only is the individual’s wealth diminished by confiscatory taxation applied to unconstitutional purposes, but he is tormented by the manner in which he calculates and confers his wealth to the federal government, for which fines and penalties are imposed for miscalculations.
Moreover, the recent scandal involving the widespread targeting of tea party, conservative, and religious groups for abusive if not unlawful scrutiny, the purpose of which was to deter them from pursuing tax-exempt designations and fully participating in public advocacy, is the latest in a long history of egregious manipulation and politicization of the Internal Revenue Service (IRS) by, among others, presidents, members of Congress, and partisan bureaucrats.51
Over time, the limitations on the taxing power contemplated by the Framers and enshrined in the Constitution have been steadily eroded. Most recently and grievously, in the Supreme Court’s 5 to 4 decision on June 28, 2012, in National Federation of Independent Business et al. v. Sebelius, Secretary of Health and Human Services, et al. (aka the Affordable Care Act or Obamacare case), the Court issued the most unscrupulous of modern judicial rulings, in which it not only distorted the federal government’s taxing power beyond all recognition, but also used that power to alter fundamentally the relationship between the individual and the federal government.52 The majority, led by Chief Justice John Roberts, was determined to uphold Obamacare despite the law’s unconstitutional mandate, which compelled individuals to engage in commerce—that is, the purchase of a government-designed private health-care policy. It seized on the Constitution’s original and limited tax provision to rewrite the law. The majority ignored the legislative history, the actual text of the statute, the Court’s precedent, and the Constitution’s text to redefine Obamacare’s penalty provision as a tax. As the dissent wrote, in part:
Judicial tax-writing is particularly troubling. Taxes have never been popular, see, e.g., Stamp Act of 1765, and in part for that reason, the Constitution requires tax increases to originate in the House of Representatives. That is to say, they must originate in the legislative body most accountable to the people, where legislators must weigh the need for the tax against the terrible price they might pay at their next election, which is never more than two years off. The Federalist No. 58 “defend[ed] the decision to give the origination power to the House on the ground that the Chamber that is more accountable to the people should have the primary role in raising revenue.” We have no doubt that Congress knew precisely what it was doing when it rejected an earlier version of this legislation that imposed a tax instead of a requirement-with-penalty. Imposing a tax through judicial legislation inverts the constitutional scheme, and places the power to tax in the branch of government least accountable to the citizenry.53
And on top of it all, Obamacare relies heavily on the IRS to enforce key provisions of the law. In addition to hiring thousands of new staffers, including auditors, a recent Treasury Department Inspector General report discloses that the IRS has created several committees, offices, and teams to implement and oversee Obamacare:
• The Affordable Care Act (ACA) Executive Steering Committee (ESC) is responsible for overall program coordination and implementation of the ACA across the IRS. This committee is co-chaired by the Deputy Commissioner for Services and Enforcement and the Deputy Commissioner for Operations Support. It also includes the IRS Chief of Staff and other IRS executives, including the business operating division commissioners, et al.
• Three program management offices (PMO): 1) Services and Enforcement; 2) Modernization and Information Technology Services (MITS); and 3) Health Care Council. These PMOs are accountable to the ESC for ACA implementation and work with the IRS business operating divisions to ensure efforts are successfully coordinated.
• Four functional ESCs, each led by an executive chair, have responsibility for specific provisions in the ACA that directly affect the four business operating divisions (Wage and Investment, Small Business/Self-Employed, Large Business and International, and Tax Exempt/Government Entities).
• The Services and Enforcement Exchange Working Teams are responsible for planning the implementation of the exchange provisions scheduled for 2014.54
Amos Singletary’s fears, among those of others, are now fully realized.
• • •
The proposed Tax Amendment would set a ceiling for income earners at 15 percent. It provides a degree of flexibility by allowing Congress to institute a flat tax lower than 15 percent or additional income-based tax rates below the 15 percent cap. Thus, individuals at lower income levels, such as those who work part-time, students with summer jobs, adults in low-skilled jobs, retired senior citizens, etc., would pay less in taxes in absolute dollars and/or be subject to lower tax rates.
The proposed Tax Amendment eliminates all forms of double taxation, including the so-called inheritance or death tax (a tax on estates often passed from parents and grandparents to their off-spring); taxes on investment income (which promotes wealth creation and economic growth); and taxes on corporations (which reduce research, capital expansion, and job creation). In most cases, these taxes have been layered upon income taxes already paid by individuals.
In addition, the proposed Tax Amendment moves the deadline for filing federal income tax returns to the day before federal elections—currently from April 15 to the first Monday in November, the day before election day. Therefore, rather than an almost seven-month gap between the filing of federal income tax returns and voting on election day, which is the situation today, the voter is able to cast his ballot with the real and personal consequences of a candidate’s tax and spending record or promises fresh in mind. Linking the two events of tax-paying and voting, in a way and at a time when the voter’s attention is most concentrated, is intended to improve political and governing accountability.
Moreover, the proposed Tax and Spending Amendments, together, will force Congress to address the growing catastrophe of unfunded obligations, including reforming the Medicare and Social Security programs to meet inescapable actuarial and economic realities. Finally, the current Rube Goldberg–like tax code will be dispatched, along with much of the IRS bureaucracy, and replaced with a relatively simple and straightforward tax collection system that no longer torments and abuses the taxpayer. The cap on taxes will also eliminate the confiscatory and complex nature of federal taxation that exists today.55
The Framers’ expectation that federal spending and taxes would be limited to support only explicitly constitutional functions—to “pay debts and provide for the common defense and general welfare”
—has been distorted deliberately as part of the Statists’ design. It is folly to believe that Congress and the president, on their own, will make the necessary and difficult decisions to address the impending financial debacle. After all, they and their predecessors engineered the approaching tsunami. As the situation becomes direr, the federal government’s actions will grow more oppressive.
The proposed Spending and Tax Amendments work in conjunction and seek to avert a societal implosion.
CHAPTER SIX
* * *
AN AMENDMENT TO LIMIT THE FEDERAL BUREAUCRACY
SECTION 1: All federal departments and agencies shall expire if said departments and agencies are not individually reauthorized in stand-alone reauthorization bills every three years by a majority vote of the House of Representatives and the Senate.
SECTION 2: All Executive Branch regulations exceeding an economic burden of $100 million, as determined jointly by the Government Accountability Office and the Congressional Budget Office, shall be submitted to a permanent Joint Committee of Congress, hereafter the Congressional Delegation Oversight Committee, for review and approval prior to their implementation.
SECTION 3: The Committee shall consist of seven members of the House of Representatives, four chosen by the Speaker and three chosen by the Minority Leader; and seven members of the Senate, four chosen by the Majority Leader and three chosen by the Minority Leader. No member shall serve on the Committee beyond a single three-year term.
SECTION 4: The Committee shall vote no later than six months from the date of the submission of the regulation to the Committee. The Committee shall make no change to the regulation, either approving or disapproving the regulation by majority vote as submitted.
SECTION 5: If the Committee does not act within six months from the date of the submission of the regulation to the Committee, the regulation shall be considered disapproved and must not be implemented by the Executive Branch.
IN ELEMENTARY SCHOOL, CHILDREN are taught that the Constitution establishes a federal government composed of three branches: the legislative, executive, and judicial. Articles I, II, and III of the Constitution create and grant limited powers and defined roles to each branch. This concept, known as separation of powers, is designed to ensure that no single body becomes too powerful and thus rules tyrannically over the others, the states, and the people. The Constitution, through an arrangement of separate but coequal branches, checks and balances, enumerated powers, federalism, and a bill of rights, diffuses power. This construct was intended to prevent the overcentralization and concentration of power in the federal government and was fundamental to preserving the nature of republican government.
Article I specifically vests Congress with the legislative power. Congress is most directly accountable to the people (the House, whose members are elected directly, and the Senate, whose members were originally chosen by the states). It stands to reason that the power to establish laws would fall to it. Article I provides, in part, “All legislative powers herein granted shall be vested in a Congress of the United States. . . . ”1 In Federalist 48, James Madison envisions Congress as potentially the most powerful of the three branches. He explained, “The legislative department derives a superiority in our governments from other circumstances. Its constitutional powers being at once more extensive, and less susceptible of precise limits, it can, with the greater facility, mask, under complicated and indirect measure, the encroachments which it makes on the co-ordinate departments.”2 It should be emphasized, however, that Madison did not mean for any branch to act outside its constitutionally prescribed limits. He wrote, “It is agreed on all sides, that the powers properly belonging to one of the departments ought not to be directly and completely administered by either of the other departments.”3 And that included Congress. “I do not conceive that power is given to the President and Senate to dismember the empire, or to alienate any great, essential right. I do not think the whole legislative authority have this power. The exercise of the power must be consistent with the object of the delegation.”4
John Locke, who was the most widely read philosopher during the American Revolutionary period, explained in his extremely influential Second Treatise of Government that a legislative body elected by the people must not delegate the power of lawmaking to any other entity, for that power was delegated to the legislature by the people. Locke wrote, “The legislative cannot transfer the power of making laws to any other hands: for it being but a delegated power from the people, they who have it cannot pass it over to others.”5 He added:
The power of the legislative, being derived from the people by a positive voluntary grant and institutions, can be no other than what that positive grant conveyed, which being only to make laws, and not to make legislators, the legislative can have no power to transfer their authority of making laws and place it in other hands.6
Locke explained that the legislature “is not only the supreme power of the commonwealth, but sacred and unalterable in the hands where the community have one placed it.”7 It is imperative, therefore, that the body chosen by the people, and vested with legislative authority, enact the laws under which the people live. “These are the bounds which the trust, that is put in them by the society, and the law of God and nature, have set to the legislative power of every common-wealth, in all forms of government.”8
Charles de Montesquieu, who was among the most widely read philosophers during the post-revolutionary period, was hugely influential on the Framers. He is mentioned several times at the Constitutional Convention, in the Federalist Papers, and during the state ratification conventions. In his masterpiece, The Spirit of the Laws, Montesquieu first expounded on the concept of three distinct governmental branches, each with separate powers to legislate, execute, and adjudicate. He wrote, “When legislative power is united with executive power in a single person or in a simple body of magistracy, there is no liberty, because one can fear that the same monarch or senate that makes tyrannical laws will execute them tyrannically. . . . ”9
The history and philosophy undergirding the separation-of-powers doctrine, and the unique character of the legislative branch and lawmaking, are unambiguous. As Madison explained in Federalist 51: “But what is government itself, but the greatest of all reflections on human nature? If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself.”10 The Framers believed that the institutions of government they had created in the Constitution, and the specific, limited powers they had granted each of them, achieved these ends.
In fact, in 1892, the Supreme Court underscored this most basic understanding when it declared in Field v. Clark that the issue of Congress delegating lawmaking authority to the executive branch would raze the constitutional structure the Framers had established. The Court ruled, “That Congress cannot delegate legislative power to the President is a principle universally recognized as vital to the integrity and maintenance of the system of government ordained by the Constitution.”11
But once again, in the late eighteenth century, as part of the Progressive movement’s agenda, a concerted campaign was launched to undo the constitutional construct by concentrating and consolidating power in the federal government. As Woodrow Wilson exclaimed in 1908:
The makers of the federal Constitution followed the scheme as they found it expounded by Montesquieu, followed it with genuine scientific enthusiasm. The admirable expositions of the Federalist [Papers] read like thoughtful applications of Montesquieu to the political needs and circumstances of America. They are full of the theory of checks and balances. The President is balanced off against Congress, Congress against the President, and each against the courts. . . . Politics is turned into mechanics under this touch. . . . The t
rouble with the theory is that government is not a machine, but a living thing. . . . It is modified by its environment, necessitated by its tasks, shaped to its functions by sheer pressure of life. No living thing can have its organs offset against each other as checks, and live. . . .12
In the 1930s and 1940s, President Franklin Roosevelt launched the New Deal, in which Congress passed laws creating federal agencies and delegating power to them to regulate vast segments of the economy and daily life, in many instances bypassing or supplanting state lawmaking authority. Initially, the Supreme Court struck down a number of these programs—ruling that they went far beyond the authority granted the federal government under the Interstate Commerce Clause—including the Railroad Retirement Act’s compulsory retirement plans in Railroad Retirement Board v. Alton R. Co.;13 sections of the National Industrial Recovery Act’s wage and hour requirements in Schechter Poultry Corp. v. United States;14 and the Bituminous Coal Conservation Act’s establishment of a national coal commission and coal districts as well as the fixing of prices, wages, and hours in Carter v. Carter Coal Company.15
However, the Court would soon reverse course and abandon its own precedent after Roosevelt threatened to change the Court’s makeup. Over time, he did in fact replace the sitting justices with men who shared his ideological views. Subsequently, in the 1937 Jones v. Laughlin Steel Corp case, the Court held that “intrastate activities that ‘have a close and substantial relation to interstate commerce that their control is essential or appropriate to protect that commerce from burdens and obstructions’ are within Congress’ power to regulate”;16 later, in the 1942 Wickard v. Filburn decision, it went much further, ruling that withholding goods from interstate commerce affects interstate commerce and therefore such activity is subject to congressional lawmaking power.17