Solution – Legal Battle Against Socialism


We are in need of a qualified lawyer prepared to file a lawsuit against Progressive Taxation as a denial of Due Process and Equal Protection of the law. For centuries, people have debated whether the wealthy should pay more taxes than everyone else and what even constitutes the wealthy. The definition of the rich has constantly changed. It has now fallen to not just an individual, but to household income. that can easily be expanded to your children if they still live at home because they cannot afford rent or to buy a house thanks to non-dischargeable school loans for worthless degrees. We have unsettled questions as to who is the rich a person or a family, and then just how much more they should pay on a percentage basis compared to everyone else.

These issues have never been resolved despite the fact that the government has been shifting the definitions and presidential elections constantly push class warfare. This notion of “progressive” taxation has escalated into demand to end all freedoms and even confiscate the wealth of the so-called rich which comes down to the top income tax bracket which was $250,000 was expanded to 37% for $518,401 or more. This issue even sparked one of the early battles over tax distribution. Supporters of progressive taxation favored a graduated tax structure, where the tax rate
would increase with the taxpayer’s income. Opponents of progressive taxation believed that a person should not pay a higher tax rate just because he or she earned a higher income for this denies equal protection of the law and creates class warfare which began with Karl Marx.

Thanks to Marx, the debate over progressive taxation began to intensify at the turn of the 20th century with the passage of the Sixteenth Amendment, which permitted a federal income tax whereby the founders prohibited any direct form of taxation. During the colonial days, a tax they created was a “faculty tax” which did not tax income, but your ability to earn income. Then in 1913, Congress passed its first “lawful” income tax which was progressive because this was the attitude that even dominated the Supreme Court at that time.

Before the creation of the United States, taxes were paid to the United Kingdom by the Colonies who also imposed local taxes. The Articles of Confederation did not give the federal government any power to tax leaving that to the States. In England, the king needed the consent of the people to be taxed which is why he would call Parliament who represented the people. To this day, it is Congress that pretends to have the “consent” of the people to be taxed. Then in 1787, the US Constitution became law and it did give the federal government that power to tax indirectly which was primarily tariffs, and a portion of those taxes had to be given back to the states based on population. The Supreme Court ruled in 1797 what was meant by Direct Taxation (see Hylton v. United States, 3 U.S. (3 Dall.) 171 (1797))

Interestingly, it took one 51.6-year wave of the Economic Confidence Model where the fiscal mismanagement of the states began to put pressure on further taxation. From 1837, some states began to add income and property taxes. The Civil War led to the Revenue Act of 1861 which allowed a federal income tax which was to expire with the Civil War. This was direct taxation which was then found unconstitutional later in Pollock v. Farmers’ Loan & Trust Co., 157 U.S. 429 (1895). It was finally in 1911 when Wisconsin became the first state to adopt an individual and corporate tax. This was upheld with respect to corporations in Flint v. Stone Tracy Company, 220 U.S. 107 (1911).

It wasn’t until the 16th Amendment in 1913, that the federal government was granted the power to levy income tax on both property and labor and included corporate and individual income tax. This went to the Supreme Court which held that the income tax was then constitution under the 16th Amendment (see: BRUSHABER v. UNION PACIFIC R. CO., 240 U.S. 1 (1916)). The income tax debate did not begin until it was no longer the rich being taxed, but it was applied under socialism and Roosevelt with the birth of the payroll tax to affect the pocketbooks of an entire nation with World, people began to pay more attention.

There is no question that many scholars expressed deep concerns about progressive taxations. They criticized progressive taxation on the basis that it was “unfair” to pay greater than one’s proportionate share. Any such proposition that one’s ability to pay is discrimination indistinguishable from race, gender, or religion. The courts just held that it is unconstitutional to draft into the military only boys and not girls. Under these same principles, it is unconstitutional to tax one person at a higher percentage because of his ability to pay. This is the very essence of Marxism which not only violates the Ten Commandments, but it clear divides society creating class warfare.

In 1952, the publishing of “The Uneasy Case for Progressive Taxation,” by Professors Blum and Kalven, did we come to a systematic and very scholarly analysis of progressive taxation. They criticized progressive taxation primarily on economic grounds but conceded its constitutionality. Later in 1985, another book was published: “Takings: Private Property and the Power of Eminent
Domain” authored by Professor Richard Epstein. Here Epstein argued that progressive taxation was not constitutional suggesting that the Fifth Amendment Takings Clause prohibited such progressive taxation.

No person shall be … deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

The Supreme Court has never definitively upheld progressive taxation. You cannot have liberty and your right to property which turns on your class any more than on your race, gender, religion, or your sexual preference. The Supreme Court should, in fact, find progressive taxation totally unconstitutional. We may need to challenge this now in order to block the Socialist Agenda about to destroy the very freedoms of the United States.

What we need is a real law firm ready and willing to bring a class action lawsuit to start the only effort we have to prevent Socialism destroying our nation like Venezuela or the old Communist Regimes. You do not create prosperity by stealing from one person and handing it to another. If it is illegal to do so if an individual robs another, then the same principle applies if politicians exonerate themselves for committing the very same act. Equal Protection means we must all be equal under the eyes of the law.

Kondratieff Wave – COVID – Future


QUESTION: Hello Mr. Armstrong,
I would first like to thank you for your work on the public and private blogs so we small investors can understand the greater trend that has been building for quite some time.
I also hope that your health conditions have gotten better and that you are recovering.
Your work has deeply shifted my view from the university education that I have just now finished; ideological stances are everywhere.
However, I am confused about a subject that is not an economic one -COVID.

Regardless of the political motives being used with this virus to create the premises of a “new” socialist revolution (political Economy); this virus has come right around the 2020 solar minimum so are we to expect this virus to continue in some way shape or form (Mutate or another virus)?

Furthermore, what guidance would you give to the next generation (West), those coming in this new cycle of China’s undeniable Empire now facing inward in building their domestic economy?
We are seeing all the hallmarks of the end of the Western Empire’s absolute reign with crippling doomsayers, more broadly the cultural landscape of the West (Climate Change, Equality against Freedom)?

You have said that we will see a rise in the commodity cycle, is the commodity cycle synched with the Kondratieff wave of the new Energy being needed to create this new future.
Are these rare minerals part of the bigger trend?

The ground is moving but as Churchill once said we must “Never let a good crisis go to waste”

Thank you for reading this entirely, I hope you all the best
Sincerely
RLB

ANSWER: The Kondratieff Wave has been seriously abused over the years. Look at the economic structure from when he constructed that data for the wave. Commodities were 70% of the economy during the mid-19th century, falling to about 40% by 1900, and eventually 3% by 1980. This is why the Kondratieff Wave failed to work as people were predicting. The next ideal turning point will be 2028.

If I constructed a cycle based on the snapshot of the economy today, 70% would be the service industry. But things change with time so the model must also adapt to the changing structure of the economy. Additionally, there were waves of innovation pointed out by Schumpeter, but even this still missed the underlying causes. Prices certainly soared during the war, for this is when food production was also disrupted. Make no mistake about it, this COVID scare has reduced food production precisely as what unfolds during a war.

Even this still fails to dig deep enough. This was also a solar minimum. We were gradually coming out of the Little Ice Age and it was still cold into 1850. Therefore, the rise in warming was been a dead-cat bounce. Consequently, we are still in a position where we are vulnerable to a decline in solar activity, which is already reducing food production. Shortages will be seen in North Korea which will incentivize an invasion of the South if they see the USA becoming divided and weak. We also see crop failure in China. The rise in prices will be from SHORTAGES, not speculative demand.

Even if we assume that this virus was manmade, that does not prevent it from mutating. The common cold is a coronavirus and we cannot cure that. This will most likely mutate for years to come. That does not mean we should be locked down with masks for the rest of our lives.

As far as guidance is concerned, first, forget European languages and start studying Mandarin. As far as skills, look to technology. Programming will be critical, for it teaches you what is possible in this new age of artificial intelligence.

Trump & Abolishing the Income Tax


COMMENT: No matter what you deny, you are advising Trump. He quotes you often and now he is taking your position that taxes are irrelevant and should be abolished. He has also said that he would create a permanent tax holiday for those earning less than $100,000 if he is reelected. Stop denying this.

GG

REPLY: Granted, he has used the language in my letters. This idea of abolishing taxes has been my position. We run deficits anyway and taxes will never balance the budget. They were needed when money was a physical coin. But it is just electronic today. We spend so much on tax collection and then the entire class warfare is always over confiscating assets of one group to had to another. Abolishing taxes was laid out in the Solution CD.

I am NOT advising Trump. I do not speak to him on the phone nor have I seen him since I attended a private event at his Florida compound. There are plenty of people who read this blog and the private blog in Washington. What information others pass on is out of my direct control. I am not interested in working at the White House. Who really cares where he takes his advice? Your tone seems hostile and I suspect you are trying to create a link between us only for political purposes. Sorry! You are barking up the wrong tree!

FT’s Interview of Putin 2019


To understand the confrontation between the USA and Russia, and the future of the world monetary system, it is always important to listen to the opposition to gain some insight into the thinking process.

Friedman – Equality & Freedom


 

Something is Wrong


QUESTION: At the WEC in Orlando, you said something was wrong. Was the computer picking up this event of a crash being contrived?

JF

ANSWER: The computer clearly was picking something beginning in August 2019, which corresponded to the start of the Repo Crisis and the reaction high in the Russel 2000. Yes, I warned that there would be a crash with the turn in the Economic Confidence Model in January 2020. A divergence was clearly unfolding and has been very dramatic. The failure of the Dow and Russel 2000 to rally compared to the NASDAQ reflected a Paradigm Shift, which also took place during the Great Depression.

This is by no means a normal market, which is why the fundamental analysis makes no sense. The stock market rises while the economy declines. However, it is only selected segments of the economy, which is why there is such a disconnect between indexes and reality.