The legality of the Fed and income tax

In fact, Lord James gives a number of good speeches that can be found on You Tube. If one comes to mind, I'll post it . . . sometime later today.

 

Frankly, I was hoping for someone to defend the idea that we need the Federal Reserve, or the idea that it's not a gigantic theft. On the other hand, I'm glad to see that everyone knows better.

 

It seems that those who express concern over wealth and power falling into the wrong hands are, for some unknown reason, not seeing the forest for the trees. They're barking up the wrong tree!
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As of July 1st, the U.S. government had spent $355 billion so far in 2010 on interest payments to the holders of the national debt.
Have you ever wondered who gets all that money?

The truth is that the wealthiest individuals around the globe have been getting very rich for a very long time off of government debt.

The Federal Reserve creates money out of thin air. In a previous article, I noted how this fact comes out in congressional hearings and yet the American people just don't seem to get too upset about it....

During a recent Joint Economic Committee hearing on Capital Hill, U.S. Representative Ron Paul directly confronted Federal Reserve Chairman Ben Bernanke about this 1.3 trillion dollars. As Ron Paul described how this 1.3 trillion was just created out of thin air, all Bernanke could do was nod his head. Why? Because it was the truth.

http://theeconomiccollapseblog.com/archives/11-reasons-why-the-federal-reserve-is-bad

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The only explanation for not seeing this for the drain on the country that it is, and addressing it, is that there must be a form of hypnosis going on.

 

storch:

As long as government and the Fed can manage to keep economic growth showing an increase by devaluing our currency, and inflation to an acceptable level offset partially by increased wages, salaries, and entitlement benefits, no one really seems to care how much debt the government accumulates, until the government has to raise interest rates in order to borrow. But the Fed appears willing to accept 0-.25% for now as China, Japan and other countries are becoming less willing to lend to us.

 

Yeah, I believe you've hit the nail on the head. It is unforturnate that people refuse to see the Federal Reserve for the grand theft that it is, even after having it pointed it out to them in terms that simply cannot be refuted or denied. Instead, they keep on blindly believing that the economic problems of the U.S. stem from the ideologies of this political party or that political party, or this economic system versus that economic system, even though the robbery is taking place right under their noses where they can clearly see it. This is denial in its worst form.

People who are stuck in their ways will go on touting their silly ideas that make absolutely no sense in light of what they are shown. They actually seem quite complacent, if not content, with the idea of the continual robbery; a sort of a hear no evil, see no evil, speak no evil thing, as far as I can tell. It's like they have this idea that they can take care of the flooding taking place in their house by simply buying lots and lots of towels to soak it up. And when you show them that the broken line on the washing machine is the reason for the flooding, they keep insisting that the real problem is right-wing or left-wing store owners who charge too much for their towels, and that fixing the water-line will only make matters worse. What can you say about that kind of thinking, except that they must have bought a lot of stock in a towel company . . .

 

Well said Storch , good post and TRUE

 

Thanks, papawolf.

And to add insult to injury, even though a partial audit of the Federal Reserve exposed it as the massive theft of the american people that it is, there are still those who are willing to ignore it in favor of going on with their ridiculous, paranoid little witch-hunts for people and things having nothing at all to do with the theft. Why? Good question! Very good question.

My guess is that it has to do with something very similar to the five stages of death; in this case, the death of one's untenable ideas concerning how the world around them really works and just who's working it. First comes denial, then anger, then bargaining, then depression, and then acceptance. I suppose you can't really fault a person for failing to get past the denial stage. Everyone at their own speed, I guess.

Whenever I tell someone how the Federal Reserve works, I get either a denial response, or an anger response. The denial response invariably takes the form of them telling me, "Well now, Storch (not my real name), you know you can't believe everything you read on the internet." And they say this without giving it even five seconds of thought. No research; no nothing! The anger response takes the form of them saying something like, "WTF! How long has this been going on?" They want to hear more. And that's great.

 

One sure sign of a corrupt presidency is the continued tolerance of the existence of the Federal Reserve. Kennedy decided it was a ripoff, as would any person, educated or not. Well, I have to take that back. I've talked to enough people to know that education is no guarantee of intelligence. From my own experience, I can tell you that common sense cannot be taught; you either have it or you don't.
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During the Civil War (1861-1865), President Lincoln needed money to finance the War from the North. The Bankers were going to charge him 24% to 36% interest. Lincoln was horrified and went away greatly distressed, for he was a man of principle and would not think of plunging his beloved country into a debt that the country would find impossible to pay back.

Eventually President Lincoln was advised to get Congress to pass a law authorizing the printing of full legal tender Treasury notes to pay for the War effort. Lincoln recognized the great benefits of this issue. At one point he wrote:

“... (we) gave the people of this Republic the greatest blessing they have ever had – their own paper money to pay their own debts...”
The Treasury notes were printed with green ink on the back, so the people called them “Greenbacks”.

Lincoln printed 400 million dollars worth of Greenbacks (the exact amount being $449,338,902), money that he delegated to be created, a debt-free and interest-free money to finance the War. It served as legal tender for all debts, public and private. He printed it, paid it to the soldiers, to the U.S. Civil Service employees, and bought supplies for war.

Shortly after that happened, “The London Times” printed the following: “If that mischievous financial policy, which had its origin in the North American Republic, should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without a debt. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of the civilized governments of the world. The brains and the wealth of all coun­tries will go to North America. That govern­ment must be destroyed, or it will destroy every monarchy on the globe.”

The Bankers obviously understood. The only thing, I repeat, the only thing that is a threat to their power is sovereign govern­ments printing interest-free and debt-free paper money. They know it would break the power of the international Bankers.

. . . In 1972, the United States Treasury Department was asked to compute the amount of interest that would have been paid if that 400 million dollars would have been borrowed at interest instead of being issued by Abraham Lincoln. They did some computations, and a few weeks later, the United States Treasury Department said the United States Government saved 4 billion dollars in interest because Lincoln had created his own money. So you can about imagine how much the Government has paid and how much we owe solely on the basis of interest.

http://www.michaeljournal.org/lincolnkennedy.htm

 

The hardest thing about learning is learning how to unlearn something once it has been shown to be untrue. The difficulty is a matter of humility, in my opinion.

I have a friend who is extremely educated. When confronted with the truth about the Federal Reserve, and unable to offer a rebuttal to my argument, he reminded me that I had not finished high school. Of course, I reminded him that such a retort was in no way a rebuttal to my point, since I had not stated that I had finished high school. He promptly changed the subject.

Such is the power of denial. Now he never brings up anything to do with politics. He has too much learning and too many false ideas and beliefs to protect.

 

There is a lot of talk these days about how to take power out of the hands of the wealthy. But in a show of absolute denial when it comes to addressing the issue, those who are most vocal about it are refusing to acknowledge the real problem. The real problem, in my opinion, is the criminal banking activity which is directly responsible for many of the woes affecting everyone's financial situation. We're talking hundreds of billions of dollars per year!

Denial is a response--non-response--to a problem that looks too big to be solved, or one that you just can't bear to consider as true due to an inability to admit that you've been duped for so long. It isn't hard to understand that elected officials, including the president, have been keeping quiet about the reality of this situation since it began; this is obviously the case. What is hard is coming to terms with it in an adult fashion. From what I've experienced of others, this can be such a hurdle that they cannot bring themselves to even admit that it is a crime. They simply won't! Ask them why, and they become incapable of giving a straight answer.

Some people fear having what they thought of as their own good understanding of the world around them blown right out of the water. It's like once they've constructed their pyramid of accepted facts about reality, they can't pull even one block out of it without having to restructure the whole thing. And the sad fact is that most people would rather defend the fraud, those committing the fraud, and those officials complicit in the fraud, than to man-up and simply call a spade a spade and get to the task of restructuring their outdated pyramid. Some will even argue that the lack of people willing to respond to this information is somehow a measure of the truth of it. In debate circles, that's commonly referred to as a fallacy--an appeal to the majority. It's one of the weakest and most illogical tactics one can use in a debate. The only thing it proves is one's inability to discuss the subject in a real and reasonable straight forward way. They should be asking themselves why they find this crime so hard to address.

When it comes to admitting that the Federal Reserve is a grand theft of the government and people of the United States, some will avoid making such an admission by saying something that basically amounts to, "Say, that sounds like something Bob has said, and unless you can defend all of Bob's ideas, I don't have to answer that." Well, that's an interesting rebuttal, but for all the wrong reasons. Sounds more like a lawyer looking for a loophole through which one of his crooked clients might escape justice. Indeed, that's exactly what it seems to be.

The real litmus test for deciding if someone is in denial when it comes to seeing the real problem is to ask them which is best for people, interest-bearing money, or interest and debt-free money. Trust me when I tell you that you will be surprised, if not completely puzzled, by the answer you will hear coming from the mouths of otherwise rational people. It is hard to not come to the conclusion that they are establishment lackeys of one sort or another. I mean, come on . . .

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FACT: The U.S. Government can buy back the FED at any time for $450 million (per Congressional record). The U.S. Treasury could then collect all the profit on our money instead of the 300 original shareholders of the FED. The $4 trillion of U.S. debt could be exchanged dollar for dollar with U.S. non-interest bearing currency when the debt becomes due. There would be no inflation because there would be no additional currency in circulation. Personal income tax could be cut if we bought back the FED and therefore, the economy would expand. According to the Constitution, Congress is to control the creation of money, keeping the amount of inflation or deflation in check. If Congress isn't doing their job, they should be voted out of office. Unfortunately, voters can't vote the FED or its Chairman out of office.

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Go ahead and challenge those who choose denial as their way of coping with such a hard fact to comment on the situation. You will find, as I have said, that you'll probably hear something like, "That sounds like something Bob would say." Exactly how that addresses anything is a mystery to me. I guess the rationale is that if Bob also said that the speed limit should be ninety miles per hour, that somehow negates the facts he states concerning the Federal Reserve. It's like they believe that, if they can't bring themselves to admit that a crime is occurring, then talking about the speed limit will somehow prove that no crime exists.

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FACT: If we eliminate the FED and uphold the Constitution, we could balance the budget and cut personal income tax to almost nothing. In Congressional hearings on September 30, 1941, FED Chairman Eccles admitted that the FED creates new money from thin air (printing press), and loans it back to us at interest (Reference 17, P. 93). On June 6, 1960, FED President Mr. Allen admitted essentially the same thing (Reference 22, P. 164). If you or I did this we would go to jail.

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Again, go ahead and ask those who prefer denial over reality to comment on this massive rip-off, and see for yourself the non-response, which will take the form of nervous laughter followed by some repeated, hollow ramblings about some disconnected issues having nothing at all to do with the question that was put to them--my neighbor is notorious for this. They will probably even accuse you of being obsessed because of your incessant asking. Of course, they will conveniently overlook the fact that the frequency of your asking is directly proportional to the frequency of their refusal to answer.

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FACT: The citizens allow the bank to print $500 billion in currency (cash). The bank pays for printing costs, ink, and paper. The Citizens do not charge the bank any interest for use of the $500 billion in printed currency. The bank uses the $500 billion cash to buy a $500 billion government bond which pays the bankers interest. The bank keeps some of the bonds and sells, for a fee (10%), some of the bonds to the public. The bank can buy back the bonds from the public simply by printing more money. The bankers can create inflation and depressions by manipulating the amount of currency in circulation. The FED operates exactly like this today. It also prints money (through the U.S. Treasury) and uses this printed money to buy loans from other banks. This money has created our inflation. We give the bank cash interest-free, then they charge us interest on our own currency.

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What part of that makes sense? More imprtantly, why would anyone defend that process of stealing, and not talk about the solution? Seriously! Why?

 

Here is a twelve year old who has no problem understanding the criminal activities of the Federal Reserve. Anyone claiming that they are interested in removing power and wealth from the hands of the few really have no excuse for ignoring this anymore. Hell, even a twelve year old can understand it!

https://www.youtube.com/watch?v=LgFweWTjr9A"]12-year Old Victoria Grant: Stop Criminal Bankers and Government!! - YouTube
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Basically, her message was that banks create money “out of thin air” and lend it to people and governments at interest. If governments borrowed from their own banks, they could keep the interest and save a lot of money for the taxpayers.

She said her own country of Canada actually did this, from 1939 to 1974. During that time, the government’s debt was low and sustainable, and it funded all sorts of remarkable things. Only when the government switched to borrowing privately did it acquire a crippling national debt.

Borrowing privately means selling bonds at market rates of interest (which in Canada quickly shot up to 22%), and the money for these bonds is ultimately created by private banks. For the latter point, Victoria quoted Graham Towers, head of the Bank of Canada for the first twenty years of its history. He said:
Each and every time a bank makes a loan, new bank credit is created — new deposits — brand new money. Broadly speaking, all new money comes out of a Bank in the form of loans. As loans are debts, then under the present system all money is debt.

Towers was asked, “Will you tell me why a government with power to create money, should give that power away to a private monopoly, and then borrow that which parliament can create itself, back at interest, to the point of national bankruptcy?” He replied, “If Parliament wants to change the form of operating the banking system, then certainly that is within the power of Parliament.”

In other words, said Victoria, “If the Canadian government needs money, they can borrow it directly from the Bank of Canada. The people would then pay fair taxes to repay the Bank of Canada. This tax money would in turn get injected back into the economic infrastructure and the debt would be wiped out. Canadians would again prosper with real money as the foundation of our economic structure and not debt money. Regarding the debt money owed to the private banks such as the Royal Bank, we would simply have the Bank of Canada print the money owing, hand it over to the private banks, and then clear the debt to the Bank of Canada.”
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Let’s see. The government can borrow money that ultimately comes from private banks, which admittedly create it out of thin air, and soak the taxpayers for a whopping interest bill; or it can borrow from its own bank, which also creates the money out of thin air, and avoid the interest.

There is no excuse for pretending to not understand this. It's common sense 101.

http://www.globalresearch.ca/index.php?context=va&aid=31125

So, the question is: why would anyone promote the freedom of a few to control society, and give liberty to those few to exploit the many?

 

There is also some confusion concerning what the Sixteenth Amendment and income tax is all about. Here is something on that:


The 16th Amendment did not change, or expand, the taxing powers.

Peck & Co. v. Lowe 247 U.S. 165, 172 (1918) "The Sixteenth Amendment . . . does not extend the taxing power to new or excepted subjects, but merely removes all occasion, which might otherwise exist, for an apportionment among the states of taxes laid on income, whether it be derived from one source or another. Brushaber v. Union Pacific R.R. Co 240 US 1."
We must reject in this case, as we have rejected in cases arising under the Corporation Excise Tax Act of 1909 (cites omitted) the broad contention submitted in behalf of the government that all receipts - everything that comes in - are income within the proper definition of the term 'gross income', and that the entire proceeds of a conversion of capital assets, in whatever form and under whatever circumstances accomplished, should be treated as gross income. Certainly the term 'income' has no broader meaning in the 1913 act than in that of 1909 (see Stratton's Independence v. Howbert 231 U.S. 399, 416) and for the present purpose we assume there is no difference in its meaning as used in the two acts.
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The Supreme Court ruled above that the definition of income, for the purposes of the 16th Amendment, was no different than the definition used in the Corporation Excise Tax Act of 1909, and that the 16th amendment did not extend the taxing power to new subjects (individuals). Therefore, "income" was legally defined as a corporate profit. A corporation is not taxed on its income, it is taxed on its profits. Therefore, however "income" is defined for corporations, it means the same thing for individuals. If a corporation has no "profit", then it pays no income tax, regardless of how much income it had.

Let me ask you this. If you contract to work for a corporation, and you exchanged 40 hours of your labor (private property) for $600 (corporate property), did you have a profit? The IRS says yes.

Now, if the corporation exchanges $600 (property) for 40 hours of your labor (property), did the corporation have a profit? The IRS says no.
Why is it that the government claims you had a $600 profit, while the corporation had a $600 deductible expense? Didn't you both just trade one property for another in an even exchange? If I trade you a $50 phone for a $50 electric saw, how much profit did I have? $50? The IRS says yes. What do you say?

The following Supreme Court case ruled that the income tax is imposed on the conduct of the business of corporations organized for profit.


http://usa-the-republic.com/revenue/true_history/Chap5.html

 

Back in the day, gold was limited--legally--to $35.00 per ounce in the U.S. Over in Europe, the price fluctuated, and it was worth $60.00 per ounce. The U.S. bankers sold their gold to the European bankers, thereby making an incredible profit at the expense of the banks' customers. That's where all the people's gold went. Everyone was sold out by the bankers. That was the national emergency of 1933.

Who knew?

 

Congressman McFadden's Speech On the Federal Reserve Corporation, 1934.

"Mr. Chairman, we have in this Country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks, hereinafter called the Fed. The Fed has cheated the Government of these United States and the people of the United States out of enough money to pay the Nation's debt. The depredations and iniquities of the Fed has cost enough money to pay the National debt several times over.

"This evil institution has impoverished and ruined the people of these United States, has bankrupted itself, and has practically bankrupted our Government. It has done this through the defects of the law under which it operates, through the maladministration of that law by the Fed and through the corrupt practices of the moneyed vultures who control it.

"Some people who think that the Federal Reserve Banks United States Government institutions. They are private monopolies which prey upon the people of these United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lender. In that dark crew of financial pirates there are those who would cut a man's throat to get a dollar out of his pocket; there are those who send money into states to buy votes to control our legislatures; there are those who maintain International propaganda for the purpose of deceiving us into granting of new concessions which will permit them to cover up their past misdeeds and set again in motion their gigantic train of crime.

"These twelve private credit monopolies were deceitfully and disloyally foisted upon this Country by the bankers who came here from Europe and repaid us our hospitality by undermining our American institutions. Those bankers took money out of this Country to finance Japan in a war against Russia. They created a reign of terror in Russia with our money in order to help that war along. They instigated the separate peace between Germany and Russia, and thus drove a wedge between the allies in World War. They financed Trotsky's passage from New York to Russia so that he might assist in the destruction of the Russian Empire. They fomented and instigated the Russian Revolution, and placed a large fund of American dollars at Trotsky's disposal in one of their branch banks in Sweden so that through him Russian homes might be thoroughly broken up and Russian children flung far and wide from their natural protectors. They have since begun breaking up of American homes and the dispersal of American children. "Mr. Chairman, there should be no partisanship in matters concerning banking and currency affairs in this Country, and I do not speak with any.

"In 1912 the National Monetary Association, under the chairmanship of the late Senator Nelson W. Aldrich, made a report and presented a vicious bill called the National Reserve Association bill. This bill is usually spoken of as the Aldrich bill. Senator Aldrich did not write the Aldrich bill. He was the tool, if not the accomplice, of the European bankers who for nearly twenty years had been scheming to set up a central bank in this Country and who in 1912 has spent and were continuing to spend vast sums of money to accomplish their purpose.

"We were opposed to the Aldrich plan for a central bank. The men who rule the Democratic Party then promised the people that if they were returned to power there would be no central bank established here while they held the reigns of government. Thirteen months later that promise was broken, and the Wilson administration, under the tutelage of those sinister Wall Street figures who stood behind Colonel House, established here in our free Country the worm-eaten monarchical institution of the "King's Bank" to control us from the top downward, and from the cradle to the grave.

"The Federal Reserve Bank destroyed our old and characteristic way of doing business. It discriminated against our 1-name commercial paper, the finest in the world, and it set up the antiquated 2-name paper, which is the present curse of this Country and which wrecked every country which has ever given it scope; it fastened down upon the Country the very tyranny from which the framers of the Constitution sough to save us."
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This is not something that we can, or should, simply get over, or overlook while discussing the problems with the state of our economy. I mean, if someone broke into your house and robbed you, and continued to rob you every week, I would not tell you that you should get over it and stop complaining. That would be ridiculous!

 

In fact, regarding the price of gold:

Once the Gold was effectively confiscated from the People and was illegal to own. The Government raised the Value of Gold for International Transactions from the price paid to the people of $20.67 per troy ounce to $35 per troy ounce.


What this did was lower the value of the Dollar Instantly. While the International Value of Gold rose by +69%, it devalued the dollar by the same amount. The people found their dollars to be worth -69% less then when they accepted it. This made it even harder for the people to survive in what was already a Depression.

http://reality-bytes.hubpages.com/hub/What-is-The-Gold-Confiscation-Act

 

There is this idea that it is better to vote for the lesser of two evils. So, when you vote, the only question in your mind will be: should I vote for that sell-out or this sell-out? Sadly, this is what this country has come to.

Any politician who doesn't mention the Federal Reserve when discussing how to fix the economy has indeed sold out to big money by agreeing to forego the Constitution in favor of subjecting us all to an institution that has proven over and over again that it intends to privatize profits and socialize losses until there is nothing left of what is ours!

By the way, for anyone who has a desire to read a comprehensive study of the truth of the matter--as well as other matters--help yourself to this:

http://usa-the-republic.com/revenue/true_history/Contents.html

Rather eye-opening, if you don't mind that kind of thing.

 

Nice group of posts storch. Not the kind of things that you'd likely learn about in todays school system.

 

Thanks Individual. They certainly don't teach these things in school.

If they did, I suspect that some kid would eventually ask the teacher, "But I thought stealing is wrong."

And what could the teacher say in return, but, "Well, Jimmy, sometimes it is and sometimes it isn't, and the government will let you know when it is and when it isn't."

Of course, Jimmy would say, "Huh, what the . . ."

And I imagine the teacher would say, "That's enough, Jimmy. Now be quiet and stop disrupting things by asking pertinent questions."

"But--"

"Let it go, Jimmy!! Embrace the Fed. Embrace it!"

 

Propping Up a Pyramid Scheme


Is there no alternative but to succumb to the Mafia-like Wall Street protection racket of a covert derivatives trade in interest rate swaps? As Willie and Kirby observe, that scheme itself must ultimately fail, and may have failed already. They point to evidence that the JPM losses are not just $3 billion but $30 billion or more, and that JPM is actually bankrupt.

The derivatives casino itself is just a last-ditch attempt to prop up a private pyramid scheme in fractional-reserve money creation, one that has progressed over several centuries through a series of “reserves”—from gold, to Fed-created “base money,” to mortgage-backed securities, to sovereign debt ostensibly protected with derivatives. We’ve seen that the only real guarantor in all this is the government itself, first with FDIC insurance and then with government bailouts of too-big-to-fail banks. If we the people are funding the banks, we should own them; and our national currency should be issued, not through banks at interest, but through our own sovereign government.

Unlike Greece, which is dependent on an uncooperative European Central Bank for funding, the U.S. still has the legal power to issue its own dollars or borrow them interest-free from its own central bank. The government could buy back its bonds and refinance them at 0% interest through the Federal Reserve—which now buys them on the open market at interest like everyone else—or it could simply rip them up.

The chief obstacle to that alternative is the bugaboo of inflation, but many countries have proven that this approach need not be inflationary. Canada borrowed from its own central bank effectively interest free from 1939 to 1974, stimulating productivity without creating inflation; Australia did it from 1912 to 1923; and China has done it for decades.

The private creation of money at interest is the granddaddy of all pyramid schemes; and like all such schemes, it must eventually collapse, despite a quadrillion dollar derivatives edifice propping it up. Willie and Kirby think that time is upon us. We need to have alternative, public and cooperative systems ready to replace the old system when it comes crashing down.

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http://www.globalresearch.ca/index.php?context=va&aid=31505

 

The above article also points out how the servants in the senate bow to their undisputed masters.