For good and evil : the impact of taxes on the course of civilization
Transcription of Annotations
Notes on front endpapers: The Swiss--177. When did you teach in 3rd World? Notes/underlinings: "Fight, Flight, Fraud." Island of Rhodes. Miracle economies of Japan, Hong Kong, Singapore, Taiwan, South Korea--low tax, supply-side economics. Proposition 13. Taming the Monster. Tax extortion--allowing taxpayers to sue tax authorities for misconduct, granting voters recall powers over district directors of the IRS. 10% flat tax--Israel, Rome, Greece, ancient China. 1. Good tax systems go bad unless citizens are able to restrain their governments; 2. civilization self-destructs from excessive taxation; 3. moderation important in the design/implementation of any tax system. Study 20 years in the making. 1. Tax professional; 2. years spent teaching history in small college with students from the 3rd World. Taxes a prime mover of history. World led by scoundrels, fools, and 2nd-stringers. With exception of China, rebelliousness surprisingly mild. Roots of modern civilization--ancient Greece, Rome/Israel--involve histories filled with drama centered on taxation. Tax issue that triggered Southern secession is seldom mentioned in Civil Was discussions. Taxation means forced exaction. No known civilization that did not tax. 6000 years. Began in Sumer, fertile plain between Tigris/Euphrates in modern Iraq. Revenue-sharing Greeks. Liberty came from the Greeks. In any conflict between liberty/taxes, liberty will give ground. 200 B.C. Alexander the Great. Rosetta Stone is a tax-oriented document. Tax records tell real story behind civilized life. Tax and sex. Proclamation of peace in Rosetta Stone means pressures of excessive taxation were destroying Egypt. Octavian became Caesar Augustus. Roman rule/tax policy followed a pattern in Egypt not unlike Ptolemies. Moslem armies offered no taxation for those who embraced Islam. Roman Republic--Roman Senate in command; Empire. Islam burst forth in 7th century A.D., ceased to spread when converts not offered tax break. No modern nation matched power of Imperial Spain--not even British Empire. Tax troubles root of decay brought about Spain's demise. William Tell refused to acknowledge the Austrian Hapsburgs/their tax collectors. 1848 Swiss adopted constitution that established a constitution, a confederation of Swiss cantons, limited fed. gov. Rejected idea of president for its dictatorial tendency. Switzerland called only real democracy. Swiss voters make final revenue decisions. 1975 a Swiss gov. referendum for tax increases voted down. 1991 Swiss voters rejected a VAT--value added tax. Bank secrecy ancient rule of German law. Imperial Spain--devastated by taxpayers from all ranks. English think defeat of Spanish Armada led to end of Spanish empire. Most hated tax--alcabala--10% excise tax on transfer of all real/personal property. Alcabala depressed industry/trade. Nobles/churchmen tax immune. "Office holding". Taxpayers: 1. fled to new world; 2. with education joined tax immune civil service; 3. with money/influence became nobles or hidalgos; 4. poor, overtaxed peasants with no money/education joined bands of gypsies. With tax system reduced to abject poverty. Nothing more dangerous for gov. than crack down on taxpayers who defy a rotten tax system. Every 20 years-rebellion--point out sicknesses the gov. needs to look after. Game King of the Mountain useful in understanding European political history. French king started at the middle of the mountain. Many French lived without taxation--prerogative of political power. Stamp Act Congress--birthplace of US. English living in colonies had no Member of Parliament. Real cause of Am. Rev. lack of political machinery to protect colonist's rights. Writ of assistance--authorization to search for smuggled goods. James Otis--1761--writs worst instrument of arbitrary power, destructive of English Liberty/fundamental principles of law. Writs influenced founding fathers to include the 4th amendment in the Bill of Rights--prohibit unreasonable searches/seizures. 1764--Sugar Act. 10,000 British troops in America for its defense. Stamp Acts popular in Europe. British Act of 1765 followed standard practice of taxing newspapers, legal documents, business licenses, diplomas. Townshend duties/Act. Writs of assistance given to Board of Commissioners of Customs. Robinson, Paxton, Hulton, caused the Rev. via oppressive administration of taxes rather than taxes themselves. 1773 Ben Franklin's "Rules by which a great empire may be reduced to a small one" provides summary of sins of the mother country toward her colonies. British Revenue agents. British Navy. Boston Tea Party. Not protest against British Japan started with heavy taxation forced by American occupation forces tax. Americans won war after 6 years; Franklin spent war in Europe. Myth Civil War started over slavery. Dred Scott case, 1857. Rich man's war, poor man's fight. Prolonged struggle between rich Southern planters/rich Northern industrialists. 1860 Southerners dominated fed. offices. From 1860-1960 number of Southerners almost nil. Lincoln's presidency--new era in national politics, excluded Southerners from major positions in national government. John C. Calhoun. Grievances of the South: 1. South excluded from most territories; 2. fear about growth of federal government powers. Tax--undue burden of taxes placed on the South--import duties. Great Compromise of 1833. Civil War started with SC firing on Ft. Sumter. South twice as rich/powerful if not for Northern tax policies. Northerners and Blacks. Lincoln most powerful president in US history. South 10% profit tax, 10% tax on crop yield. 1861 Morill Tariff--highest tariff in US history. Lincoln--conciliatory toward slavery, threatening with import taxes. John Stuart Mill, leading English writer on political economy, Lincoln/Congress guaranteed slavery in places where it existed. People who want freedom must fight for it. North did not go to war to free slaves; South did not secede because of antislavery crusader in the WH. Secession cause of Civil War. Business of America business. If nation wants to increase savings, exempt interest income. All good tax systems go bad. Best cure separate power to spend from power to tax. We are taxing ourselves to death. Living in age of liberty. Common denominator of good tax systems is moderation. Equality is virtue.