By Publius Huldah
Do you remember the public discussions which went on for years about the proposed equal rights amendment to our federal Constitution? That’s how it’s supposed to be before an amendment is ratified: The People get an opportunity to hear the arguments, discuss it among themselves and their state legislators, and reject amendments which are bad.
What if someone found a way to circumvent this pesky public discussion, and get an amendment ratified before The People found about it? And even before the state legislators who ratified it found out what they had done? And what if this amendment delegated massive new taxing powers to Congress?
Such a scheme has been developed by Compact for America (CFA). They present their already prepared compact legislation to state legislators as a “balanced budget amendment”; and urge them to get it passed by their state legislature.
The provisions which authorize Congress to impose the new taxes, and which provide for pre-ratification of the new taxes amendment, are buried in some 15 pages of single-spaced excruciatingly convoluted and boring writing. Rare is the legislator who has the time to wade through the verbiage and figure out what it says. 1
Once three fourths of the States have passed CFA’s compact legislation, the new taxes amendment is thereby ratified.
So that’s how an amendment to our Constitution which delegates massive new taxing powers to Congress can be ratified before The People know what has been done to them; and before the state legislators who did it find out what they have done to the American People. 2
The scheme was passed several years ago by state legislators in Alaska, Georgia, Mississippi, and North Dakota; was passed this year by Arizona Legislators as HB 2226 and signed by the Governor of Arizona on March 30, 2017; 2 and is now pending in Missouri as SB 13, in Oklahoma as HB 1434, and in Texas as SB 959. Arkansas rejected it a week or so ago.
Let’s look at the particulars of the compact legislation using the Arizona Bill as the example.
HB 2226 does nothing to control federal spending or “balance the budget”
Section 1 of the Compact [page 2, line 16 of the pdf edition] allows Congress to spend as much as they take from us in taxes or add to the national debt! But that’s what Congress has been doing!
Sections 2 & 3 [page 2, lines 20-37] permit Congress to raise the debt whenever 26 States agree.
Section 4 [page 2, lines 38 et seq.] is a joke: Who believes Congress will impeach a President for refusing to “impound” an appropriation made by Congress?
CFA’s BBA is an actually a grant of MASSIVE new taxing powers to Congress.
The true purpose of the compact legislation is hidden behind promises such as, “cutting federal spending”, “balancing the budget”, and “scaring Congress”. The true purpose of the Compact is to delegate to Congress MASSIVE NEW TAXING POWERS. Specifically, it authorizes Congress to impose a national sales tax and a national value added tax (VAT).
This is where the grant to Congress of the new taxing powers is set forth:
Section 5 [page 3, lines 4-6] permits Congress, by a 2/3 vote of each House, to impose a new or increased “general revenue tax”.
Section 6 [page 3, lines 24-26] defines “general revenue tax” as “any income tax, sales tax, or value-added tax levied by the government of the United States…”
There it is! All Congress needs to impose a national sales tax and/or a national VAT tax (in addition to the income tax) is a 2/3 vote in each House!
Section 5 also permits Congress, by a simple majority of each House, to impose a “new end user sales tax” which would replace the federal income tax. But nothing requires Congress to impose a “new end user sales tax” to replace the income tax.
It will be up to Congress to decide whether to impose a new national sales tax and/or VAT tax on top of the existing income tax (if they get 2/3 vote of each House); or whether to impose a new end user sales tax to replace the income tax (if they get only a simple majority in each House).
So! CFA’s version of a BBA is not about “balancing the budget”, or “scaring Congress”, or “reducing federal spending”. It’s about giving the federal government massive new taxing powers!
A value-added tax is a “turbo-charged national sales tax on goods and services that is applied at each stage of production, not merely on retail transactions” and raises a “gusher of revenue for spendthrift governments worldwide.”
When State Legislatures pass compact legislation such as HB 2226, they are actually pre-ratifying the new Amendment to the US Constitution which grants these massive new taxing powers to Congress.
Please note: When State Legislatures pass bills like HB 2226, they are RIGHT THEN AND THERE RATIFYING THE AMENDMENT. I’ll show you:
HB 2226 says in Article IV, Section 7 (e) of the Compact [page 6, line 43, et seq.]:
“When any Article of this Compact prospectively ratifying the Balanced Budget Amendment is effective in any Member State, notice of the same shall be given together with a statement declaring such ratification and further requesting cooperation in ensuring that the official record confirms and reflects the effective corresponding amendment to the Constitution of the United States…” [boldface mine]
Article IX, Section 1, of the Compact [page 11, line 41 et seq.] says:
“Each Member State, by and through its respective Legislature [passage of HB 2226], hereby adopts and ratifies the Balanced Budget Amendment.”
There it is: When State legislatures pass bills like HB 2226, they are thereby ratifying an amendment to the US Constitution which delegates massive new taxing powers to Congress.
When 38 States have passed legislation like HB 2226 – and when Congress approves it, 3 our Constitution is thereby AMENDED and Congress now has constitutional authority to impose a new national sales tax and a national VAT tax – even while keeping and increasing the income tax.
The provisions of the compact which deal with a convention – Articles V through VIII – are a smokescreen which obscures from state legislators the fact that when they pass legislation like HB 2226, they are pre-ratifying the amendment to our federal Constitution.
The convention is a formality – a free trip at taxpayers’ expense.
What’s the Solution?
Don’t feed the beast by giving it massive new taxing powers. The solution is to downsize the federal government to its enumerated powers.
Our Constitution already limits federal spending to the enumerated powers – learn what those powers are, and enforce the Constitution we already have.
And use your heads! You who foolishly believe that a BBA [whether CFA’s version or another version] will force Congress to reduce spending, know this: a BBA is a mandate for Congress to increase taxes, among other horrors.
1 Legislators don’t read the bills they vote on. That’s why they have bill summaries. The Compact legislation filed in Arizona has two bill summaries: HERE and HERE. Can you find where Arizona Legislators were informed they would be pre-ratifying a new taxes amendment to the US Constitution if they passed the compact legislation?
2 Arizona Republican Legislators were warned over & over & over again; the Governor of Arizona was also warned. But they ignored the warnings, and are without excuse.
3 Pursuant to Article I, §10, last clause, US Constitution, CFA’s Compact is not effective unless Congress approves it. Will Congress approve a Compact Amendment which delegates massive new taxing powers to them?
By Publius Huldah
A devilish plot is afoot to impose new national taxes on the American People. It is a masterful piece of trickery because the authorization for the new national taxes is buried within Compact for America’s version of a balanced budget amendment to the US Constitution.
Furthermore, the balanced budget amendment does nothing to control federal spending; and transforms our Constitution from one of limited and defined powers to one of general and unlimited powers. 1
Let’s look at Sections 1-6 of Compact for America’s balanced budget amendment:
It does Nothing to Control Federal Spending
Section 1 allows Congress to spend as much as they take from us in taxes and add to the national debt. That’s a good idea?
Sections 2 and 3 permit Congress to raise the debt whenever 26 States agree. States are addicted to federal funds. Will 25 States agree not to take more federal funds?
Section 4 is a joke: Who believes Congress will impeach a President for refusing to “impound” an appropriation made by Congress? Congress won’t even impeach a President for Treason.
How Authorization for the New Taxes is Hidden
Section 5 says:
“No bill that provides for a new or increased general revenue tax shall become law unless approved by a two-thirds roll call vote of the whole number of each House of Congress….” [italics mine]
What is a “general revenue tax”? Section 6 defines it:
“…’general revenue tax’ means any income tax, sales tax, or value-added tax levied by the government of the United States…” [italics mine]
Now go back to Section 5 and substitute the definition of “general revenue tax” for that term:
“No bill that provides for a new or increased income tax, sales tax, or value-added tax levied by the government of the United States shall become law unless approved by a two-thirds roll call vote of the whole number of each House of Congress….”
There it is: All that’s needed is approval of two-thirds of the members of each House and a new national sales tax and/or value added tax is imposed on us. And they can increase it, along with increasing the income tax, whenever they get two-thirds of the members to vote for it.
Section 5 also permits Congress to make laws to impose a new “end user sales tax” 4 which would replace the income tax – this “end user sales tax” is passed by a simple majority of both houses.
So! Compact for America’s balanced budget amendment provides two options to Congress:
· Two-thirds of the members of both Houses can impose a new sales tax and/or value-added tax in addition to the income tax; or
· A simple majority of both Houses can impose “a new end user sales tax” which replaces the income tax.
Which option will Congress choose?
Our Constitution Doesn’t Now Authorize a National Sales Tax or Value-added Tax
Article I, §8, clause 1 says:
“The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises…”
Principles of Compact for America say this clause already authorizes a national sales tax or value added tax. Board Vice-President Chip DeMoss said on Feb. 12, 2014:
“a national sales tax would be an “impost” (defined as a tax or similar compulsory payment) that is authorized under Article I, Section 8, Clause 1…” [see comments and scroll down after comment 19 till you see Chip DeMoss’ name].
We may not properly use DeMoss’ redefinition of “impost”!
We must use the definition of “impost” our Framers used: The Federalist Papers say an “impost” is a tax or duty on imports. Type imposts in the search box [at the link] and the Papers discussing imposts will come up. See for yourself that an “impost” is a tax or duty on imports.
Webster’s 1828 Dictionary defines “impost” as:
“…Any tax or tribute imposed by authority; particularly, a duty or tax laid by government on goods imported, and paid or secured by the importer at the time of importation. Imposts are also called customs.”
Do you see?
National sales taxes and value-added taxes are also not “excise” taxes. Excise taxes are a tax on a unit of goods – such as the infamous whiskey excise tax of 1791 which led to the Whiskey Rebellion. 5 It imposed a flat tax per gallon. The tax was payable for domestic whiskey at the distillery (§17 of the Act) and the casks were numbered and marked to show the tax had been paid (§19 of the Act).
“Taxes” at Art. I, §8, clause 1 refers to the apportioned direct tax provided for at Art. I, §2, clause 3 of our Constitution.
Our Framers were specific about the kinds of taxes Congress is permitted to impose. Congress does not have the power to impose any kind of tax it wants. Our Framers limited Congress’ taxing power to:
· the apportioned direct taxes at Art. I, §2, clause 3;
· the duties or imposts on imports at Art. I, §8, clause 1; and
· the excises at Art. I, §8, clause 1.
A sales tax is none of the above. A sales tax is a percentage of the retail price of goods. A value-added tax is a “turbo-charged national sales tax on goods and services that is applied at each stage of production, not merely on retail transactions” and raises a “gusher of revenue for spendthrift governments worldwide”.
We have never had a national sales tax or value added tax in this Country. Why? Because they are not authorized by the Constitution.
We were manipulated into supporting the 16th Amendment. We were told the income tax would “soak the rich” – and the envious drooled at the prospect.
And so again today, statists are seeking to trick us into supporting a national sales tax or a value added tax: first, by concealing it within the verbiage of the bill; 6 and then, once the trickery was exposed, by claiming the Constitution already authorizes these new types of taxes.
There is a Better Way: Downsize the Federal Government!
Our Constitution limits federal spending to the enumerated powers. The list of objects on which Congress may lawfully spend money is a short list. See the list HERE.
Most of what the federal government does today is unconstitutional as outside the scope of the powers delegated by the Constitution. Let’s cut federal spending by downsizing the federal government to its enumerated powers and constitutional limits.
1 Congress’ spending is limited by the enumerated powers: If an object is on the list of enumerated powers (e.g., the patent & copyright office authorized by Art. I, §8, cl. 8), Congress may lawfully spend money on it. That’s how our Constitution already controls federal spending.
All versions of a balanced budget amendment change the constitutional standard for spending FROM whether an object is on the list of enumerated powers TO a limit on total spending where Congress may spend money on whatever they or the President put in the budget. This is what transforms our Constitution FROM one of enumerated powers only TO one of general and unlimited powers. And that is the true purpose of a balanced budget amendment. It has nothing to do with limiting federal spending – the pretended spending limits are fictitious since they may be waived whenever the feds [and 26 of the States] want to waive them.
3 Matthew Burns’ article about the hearing on HB 366 before N. Carolina’s House Judiciary Committee (which passed HB 366) doesn’t mention the new national taxes. Burns quotes the Bill’s sponsor, Rep. Chris Millis, as saying the problem is “Washington is unwilling or unable to limit itself.” So the solution is to massively increase Congress’ taxing powers?
4 “End user sales tax” is not defined in the balanced budget amendment.
5 Apparently, the practice of tarring & feathering “revenuers” began with the Whiskey Excise Tax.
6 The trickery was exposed over a year ago HERE. Since then, Compact for America has claimed the Constitution already authorizes the new taxes. Are we too gullible to be free? PH
August 26, 2015