Monday, June 16, 1997 – Ronald on Taxes

After getting home late, up very early to get to work. I bought a cup of coffee at the local convenience store and turned on NPR as I headed toward the Delaware Memorial Bridge. The news featured the newly traditional press conference with the big trial’s jury. Most of the air time was given over to the woman who described the emotional reactions of the jurors.

‘When we voted guilty, we all cried,’ she said.

She and others made it clear that they were no Simpson jury. They went carefully through all the evidence before voting guilty on the first ballot. They praised the judge, the lawyers, each other. One big happy family.

Also, the federal government was in the headlines again. Some new independent panel has concluded that Desert Storm vets were exposed to chemical weapons and that the Pentagon knew it early on. They tried, however, to blame the syndrome on stress rather than admit the truth.

Then, a Philadelphia Story. District Attorney Lynn Abraham announced that fugitive Ira Einhorn, a local hippy-guru-celebrity of the early 1970s, had been arrested in France. Convicted in absentia over a decade ago for the murder of his girlfriend, Einhorn was expected to fight extradition. Legal experts reported he might have a case. France does conduct trials in absentia but always grants a retrial if the fugitive is apprehended. They do not have to grant extradition if they decide Einhorn’s human rights are being violated. But a retrial is not probable in this case, according to Philadelphia sources. Einhorn has already been sentenced in absentia – I think with the death penalty. Police found the girlfriend in a trunk in his abandoned Philly apartment, long dead and horribly decomposed. A neighbor had called the police because of the smell. Einhorn was apparently quite a brilliant con-man and everyone at the time was as embarrassed about having been taken in by his charm as they were outraged about the crime. Then the DA’s office and the police were embarrassed by his successful and amazingly lengthy evasion of capture. If I read Abraham’s tone of voice aright, there’s no second chance in the cards for Einhorn. Vengeance is mine, saith the DA.

The spell of the weekend was broken almost immediately at the Pet Palace. I’ve been instituting some changes to improve customer service and hopefully increase sales, but the growing realization that I’m serious about what I want the employees to do is creating resistance: they don’t have time; they forgot; this will never work. Oh well. I’ve been through this before. They’ll come around eventually. I’m not as optimistic about the PP computer system – old hardware struggling to run Bill Gates’s Windows, and my workstation doesn’t want to execute the timed backup. The error messages claim that it didn’t have time, that it forgot, that the program will never work…
At three o’clock I took the day’s receipts to Patrick’s office. His summer intern of several years standing, Andrew Carmody, was there. So was Ronald Mackenzie, who runs the computer side of the business. Andrew is young and earnest, a bookish college student who works part time installing computers and software. Ronald is consistently glum, the half-willing hostage of a technology he has come to loathe but can’t bring himself to leave. I told him about the backup problem at the Pet Palace. Neither one of us wanted to talk about it. He remembered something he had to take care of in his office, and Andrew drifted out after him.

After some business preliminaries, Patrick informed me that Clinton had been present at the U.S. Open, probably in the NBC tent we’d been sitting next to. Then he showed me a postcard he’d bought in Washington, a color picture of the President, casually dressed and smiling. A printed message on the back conveyed his greetings to the card’s recipient.

‘Cool,’ I said. ‘Proceeds to the Clinton Defense Fund? There’s an idea. But would you ever have expected to see something like this? Do you suppose FDR did postcards of himself? Smiling and waving from his wheelchair? I expect this is another Clinton innovation,’ I said.

Ronald drifted back in. He was carrying a book. I cocked my head to read the title: For Good and Evil. He explained that it was an exhaustive critique of the U.S. tax system.
‘You read it?’ Patrick asked in astonishment. He looked at me. Neither of us had been able to nerve ourselves up for such an ordeal.

‘Yes. I did.’

‘What did it say?’ I inquired.

‘A lot of stuff.’ We waited. Ronald starts such conversations slowly. ‘I guess the key thing is that he defines the historical criteria for the kinds of tax systems you find in tyrannical governments. There are things that are pretty consistent. The tax system operates outside the normal judiciary and outside normal credit and bankruptcy law.’
‘How do we stack up?’ Patrick asked, with an ‘as if we didn’t know’ expression on his face.

‘Pretty much right down the line with the tyranny model,’ Ronald conceded. “Our income tax system operates outside the judiciary and outside the Constitution. If you’re hauled into U.S. tax court, you don’t get a jury of your peers. A judge simply decides your case. And if there’s a dispute, you still have to pay the levied taxes and then win before the government will make restitution. Even if you go bankrupt, that doesn’t clear your tax debt, which is eternal.’

Patrick was nodding. Ronald paused, resumed. ‘There’s also the issue of government abuse of the tax system to persecute enemies and undesirables. The feds have a pretty strong track record of doing that over the years, too.’

‘Does this guy think there’s such a thing as a good tax system?’ I asked.
‘Well, he cites the standard tax system of the ancient world. Based on the decuma. One tenth to the government. It seems to have worked for a long time.’

‘The tithe,’ Patrick said triumphantly. I had heard him expound, particularly with religious friends, on the Church’s default of social responsibility and the Christians’ unquestioning acceptance of it. He was fond of asking the devout whether they were morally comfortable with giving four times as much to the government as the Church had once asked. Was the government four times as righteous? He rarely got any answer but a blank look.

Ronald went on, like a tractor slowly plowing a field. ‘There’s another interesting constitutional point besides the usual Fourth and Fifth Amendment problem. It seems there’s a strong chance the income tax is illegal. When they went to ratify the fifteenth amendment, there was some funny business about it. A state that didn’t ratify but got counted anyway. That was the margin by which the Amendment became law.’
‘Tell it to the tax court judge,’ Patrick said.

‘Anything else? ‘ I asked Ronald.

‘Yeah. One of the key parts of a fair tax system is that it rests on willing compliance. That’s the problem with graduated tax systems. By definition, they operate more by extortion than willing compliance, because there’s a big percentage of the population that complies because others are willing them to. The truth is, they really can’t fight back. It’s related to the old truism that a democracy fails when the people discover they can vote themselves money out of the public treasury.’

Patrick spoke up. ‘I had a funny conversation with an IRS agent this morning. He was after more payroll taxes for the Pet Palace, and I told him I was working on it. He asked me to call him in a week or two and let me know how it was coming. Now, normally these guys are completely one-dimensional. ‘Give us the money. Give us the money now.’ So I said, ‘I know you guys really need the money, so we’ll do our best to get it to you soon.’ And then he said, ‘One thing you can count on – Congress is going to keep on spending more money than we could ever collect.”

‘An IRS agent said that?’ I asked.

‘Yes,’ Patrick confirmed. ‘The first time in my whole career when one of them has ever said anything like that to me.’

Is the edifice starting to crack? We wondered. It wasn’t humanity they were displaying. But it might be that the necessary ruthless fanaticism is winding slowly down. Maybe the American people are a stone that just can’t produce much more blood. And maybe the IRS is starting to figure that out.

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