When the income tax was enshrined within our Constitution in 1913, it had already been imposed decades earlier by statutory law. The 16th Amendment essentially granted our government the right to collect income tax whether the source was our labor or our capital and without apportioning its collection so as to reflect the unequal populations within the states.
Between its ratification in 1913 and 1918 the top income tax bracket jumped from 7% to 77%. It then swept lower in the years leading up to World War II; and in 1945 it peaked at 94%. Today it hovers at 35%.
Not surprisingly, the size and scope of government has also ballooned. How big we allow it to swell ought to depend upon many real-world variables: No abstract political ideology, however finely principled, could credibly predetermine that size. The right answer requires an integration of actual criteria — population, availability of natural resources, willingness of humans to share or trade for them, propensity for and capacity of others to expropriate them — birth rates, death rates, climate, etc.
Contrary to purist political ideologies humans are not now held back from an Earthly paradise by government itself. The rule among humans is discord; the exception, cooperation. Thus government remains a necessary evil — if also an enduring sign of human failure.
But how we fund our government certainly ought to reflect our ideals and our eventual goal. There are moral implications in play here: When the government taxes an activity or a product we are discouraged from it. Ought the government then tax work and efficient productivity? Might it not tax activities and products we would be better rid of?
Crime obviously costs society on many levels — prevention, enforcement, adjudication, incarceration, etc. Would it be so unreasonable then if prisoners were made to work, repaying society for those costs? Or when citizens file frivolous lawsuits or defraud federal programs, ought not these activities be discouraged through the imposition of a fee or a tax?
When for that matter foreign governments around the globe call upon our U.S. military to protect their national borders, ought not these countries pay for our American sacrifices? And when multinational or American companies pollute our lands and waters, shouldn’t we consistently and fully discourage this activity, imposing taxes or fees equaling the totality of our present and our future costs?
The theoretical machinery underlying this moral system of taxation is Pavlovian to be sure, but the actual output generated by it is of moral and material benefit. It highlights the potential instructive role of a limited government — linking the funding of its services to those citizens who make the services necessary in the first place.
We all require government, for instance, for the securing of our safety, our private property, and our state and national territory; so we all should pay a tax or fee in support of the maintenance of the police and military forces who guarantee these things to us.
Finally, under a direct democracy in particular, this moral system of taxation requires that no one voting block may arbitrarily impose expenditures upon another — not solely among different segments of the public in a given year but, perhaps more importantly, between current voters and all future generations of voters.
Therefore, in order to optimize this moral system of taxation, this Constitution must specifically prohibit such transfers of debt:
Amendment X – No law enacted by electoral initiative or otherwise shall establish a debt, project or fiscal program where the financing thereof would obligate future citizens to the financial commitments of current voters. Appropriations shall be drawn from revenues collected within one year of their appropriation through floating debt and the collection of these fees and revenues only:
-Usage fees levied upon persons whose activities degrade or monopolize public property;
-Usage fees levied upon persons enjoying exclusive use of land, in proportion to its acreage and the volume, mass and scarcity of natural resources therein;
-Usage fees levied upon foreign governments for involvement of United States military personnel, equipment or weaponry in operations outside the territory of the United States, at the request of said governments, which would otherwise be the responsibility of any sovereign nation to itself;
-Misusage fees levied upon persons whose activities, whether intentional or negligent, damage public property;
-Misusage fees levied upon persons whose activities damage the private property of another person, or impede its exclusive use by barring lawful access to it, or operation of it; physically altering it or its value; or otherwise converting or making improbable its peaceable, lawful, exclusive enjoyment; thereby necessitating the intervention of law enforcement or courts of law;
-Misusage fees levied upon persons who assume unnecessary risks or file frivolous complaints that require emergency public services or courts of law;
-Sales of forfeited, seized property;
-Sales of goods processed or manufactured by state-confined workers; or revenues from the contracting-out of their services;
-Sales of government property to allies of the United States, upon a two-thirds majority vote among the Governors and a unanimous vote between the President and the Cabinet—or the Defense Cabinet, in the case of military property;
-Duties, imposts and excises;
-Safety-inspection and handling charges;
-Any fiscal-program income deduction annually re-authorized by electoral initiative.
All fees shall reflect the actual duration and costs of use or misuse, so that collections in anticipation of use may necessitate reimbursement.
No law enacted by precinct electoral initiative shall institute or increase an appropriation from revenues derived in part or in full from another precinct, unless with a fifty-one percent consenting vote within the latter precinct, or unless authorized by this Constitution; nor withhold or disburse revenues lawfully collected for and due to a city, county or state government, or the federal government.