The Income Tax and IRS Squelch Freedom

Personal Freedom and Prosperity 101: Personal Power

The distinctive principle of Western social philosophy is individualism.
It aims at the creation of a sphere in which the individual is free to think, to choose, and to act without being restrained by the interference of the social apparatus of coercion and oppression, the State. All the spiritual and material achievements of Western civilization were the result of the operation of this idea of liberty. —Ludwig von Mises

The Income Tax and IRS Squelch Freedom

“Taxes are what we pay for a civilized society,” read the words of Oliver Wendell Holmes inscribed over the entrance to the Internal Revenue Service building in Washington, D.C., but how we tax and spend determines, to a great extent, whether we are prosperous or poor, free or enslaved, or, most importantly, good or evil.

– Charles Adams, author, For Good and Evil: The Impact of Taxes on the Course of Civilization.

Abruptly, Americans have learned about the IRS abusing its enormous power. Presently, Congress and the media are investigating who is responsible and what were their motives. Of course, there will be much political posturing about laws and audits to stop and prevent this abuse of power.

As sure as the sun rises in the East, the coercion and oppression by the IRS against American citizens will reoccur. Since income tax was initiated in America, the IRS and politicians have wrongfully and maliciously abused their power for personal and political gain. A few examples:

James Bovard in the Wall Street Journal has exposed the continuing abuse of power by politicians and the IRS. For example, Franklin Roosevelt used the IRS to harass Sen. Huey Long, Father Charles Coughlin, Treasury Secretary Andrew Mellon, William Randolph Hearst and Moses Annenberg.

In the 1990s, Members of Congress were directing the IRS to investigate their opponents. The book “Power to Destroy: The Political Uses of the IRS from Kennedy to Nixon,” written by Franklin & Marshall professor, John Andrew documents how Kennedy, Johnson and Nixon used the IRS to investigate, audit and harass their political opponents.

Since the dawn of civilization, the form and power to tax strongly determines the progress and decline of peoples and nations. In Charles Adams’ book, For Good and Evil: The Impact of Taxes on the Course of Civilization, documents how that rate, complexity and collection of taxes determines the rise and fall of great nations – ancient and modern. The Dutch Republic was a great power in the 17th Century, but heavy taxation and excessive debt strangled their commerce and trade, which resulted in a devastating decline. Juxtaposed to the Dutch, the British Empire expanded due to lower tax rates and a steady revenue flow paid for government debt.

For nearly 100 years in America, our income tax has been used and abused by politicians for their personal gain. Incessantly, the tax code is used to favor industries, localities (states and communities), and voting blocks. Income tax policy is used for every conceivable political and social policy: stimulus, housing subsidies, welfare, energy – it is truly endless. As a result, America has a very complex, incoherent and unfair tax code administered by devious politicians and powerful IRS agents. Dangerously, taxes are strangling commerce and trade and the tax revenue fails to pay for government debt.

Harmfully, there is no means to effectively stop the on-going corrupt abuse of power. If we continue with the income tax and IRS (or a reconstituted policing power), America cannot remain a vibrant and expanding nation of freedom and prosperity.

Now, is the time to make gigantic structural changes.

First, we need to repeal ObamaCare, which was corruptly and incompetently designed. Horrifically, ObamaCare commands the IRS to obtain records concerning the health and finances of every American – which greatly increases the coercion and oppression of the IRS.

Second, we need to repeal our income tax.

Third, we need to reduce excessive government spending.

Fourth, we need to finance government with some form of consumption tax.

Fortunately, there are two consumption tax plans that have considerable merit and public support – The Fair Tax and Flat Tax. See an article in Forbes on the Fair Tax. See FreedomWorks on the Flat Tax.

Hopefully, America is waking up to the terrible uses and abuses of the income tax and its enforcers. Hopefully, we have the wisdom and ability to make gigantic structural changes. Ultimately, a society that has a low tax rate, limits government spending and allows every citizen the use and enjoyment of their property will have prosperity and freedom. As Ludwig von Mises wrote: