"Another means of silently lessening the inequality of property is
to exempt all from taxation below a certain point, and to tax the
higher portions of property in geometrical progression as they
rise." --Thomas Jefferson to James Madison, 1785.
Thursday, July 16, 2009
THOMAS JEFFERSON LIKED PROGRESSIVE TAXATION
This quote should give some pause to the fiscal conservatives who also claim to be Constitutional originalists:
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7 comments:
Among Jefferson's first acts as President was to eliminate taxation of American Citizens. That reflected his view of taxation in the American context.
The quote you provide comes from a letter he penned in 1785 while visiting the Monarchial lands of France as a diplomat. He suggested a remedy for their social system that essentially prohibited the poor from taking advantage of the great abundance of land and resources.
The problem was resolved somewhat differently several years later when the poor revolted against the King and beheaded quite a lot of royalty and nobility who had oppressed them, then a lot who had not, resulting in a horrific bloodbath.
The situation regarding the distribution of wealth and social mobility in America today is closer to that in pre-revolution France, then it is to America in Jefferson's day. Therefore, Jefferson's comment would apply here now. The growth and decline of the middle class in this country over the last century tracks directly with the growth and decline of a progressive income tax. The rich now extract more from the economy than ever with no corelation to their contribution to the economy while paying the lowest taxes since the robber/baron era.
"The situation regarding the distribution of wealth and social mobility in America today is closer to that in pre-revolution France, then it is to America in Jefferson's day. Therefore, Jefferson's comment would apply here now." Wrong! The government's role is to protect its people whom "are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness." This quote of Jefferson's is being taken out of context thanks to looters like Thom Hartmann.
If you read the whole letter, it's clear that Jefferson is referring to PROPERTY taxes. Not INCOME taxes. Of course those poor people shouldn't pay taxes when they have nothing to tax. Income tax is a farce created by central banks, (looters). I hate Thom Hartmann too.
Thomas Jefferson to James Madison
28 Oct. 1785 Papers 8:681--82
Seven o'clock, and retired to my fireside, I have determined to enter into conversation with you; this [Fontainebleau] is a village of about 5,000 inhabitants when the court is not here and 20,000 when they are, occupying a valley. ...The king comes here in the fall always, to hunt. His court attend him, as do also the foreign diplomatic corps. ...This being the first trip, I set out yesterday morning to take a view of the place. ...I fell in with a poor woman walking at the same rate with myself and going the same course. Wishing to know the condition of the labouring poor I entered into conversation with her, ...her vocation, condition and circumstance. ...my walk led me into a train of reflections on that unequal division of property which occasions the numberless instances of wretchedness which I had observed in this country and is to be observed all over Europe. The property of this country is absolutely concentered in a very few hands, having revenues of from half a million of guineas a year downwards. These employ the flower of the country as servants, ...They employ also a great number of manufacturers, and tradesmen, and lastly the class of labouring husbandmen. But after all these comes the most numerous of all the classes, that is, the poor who cannot find work. I asked myself what could be the reason that so many should be permitted to beg who are willing to work, in a country where there is a very considerable proportion of uncultivated lands? These lands are kept idle mostly for the aske of game. It should seem then that it must be because of the enormous wealth of the proprietors which places them above attention to the increase of their revenues by permitting these lands to be laboured. I am conscious that an equal division of property is impracticable. But the consequences of this enormous inequality producing so much misery to the bulk of mankind, legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind. The descent of property of every kind therefore to all the children, or to all the brothers and sisters, or other relations in equal degree is a politic measure, and a practicable one. Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions OF PROPERTY in geometrical progression as they rise. Whenever there is in any country, uncultivated lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural right. The earth is given as a common stock for man to labour and live on. If, for the encouragement of industry we allow it to be appropriated, we must take care that other employment be furnished to those excluded from the appropriation. If we do not the fundamental right to labour the earth returns to the unemployed. It is too soon yet in our country to say that every man who cannot find employment but who can find uncultivated land, shall be at liberty to cultivate it, paying a moderate rent. But it is not too soon to provide by every possible means that as few as possible shall be without a little portion of land. The small landholders are the most precious part of a state.
Very helpful piece of writing, much thanks for this article.
SEVERAL CONTRIBUTORS HAVE SUGGESTED THAT JEFFERSON IS TALKING ABOUT PROPERTY TAXES RATHER THAN INCOME TAXES. THEY SUGGEST THAT JEFFERSON DID NOT FAVOR A TAX ON INCOMES, THAT HE WAS ONLY TALKING ABOUT PROPERTY TAXES.
IN FACT, JEFFERSON WAS ADVOCATING A TYPE OF PROGRESSIVE INCOME TAX.
TO UNDERSTAND THIS, ITS IMPORTANT TO UNDERSTAND THAT PROPERTY TAXES WERE IN FACT A FORM OF INCOME TAX IN 18TH CENTURY FRANCE.
BEFORE THE INDUSTRIAL REVOLUTION, FRANCE WAS SIMILAR TO AMERICA IN THAT THE GREAT MAJORITY OF THE ECONOMY WAS BASED ON AGRICULTURE. LAND WAS USED MAINLY FOR FOOD PRODUCTION. IN ESSENCE, FOOD WAS THE INCOME PRODUCED BY THE LAND BECAUSE IT REPRESENTED THE FRUITS OF THE LABOR OF THE LANDOWNER. SINCE A LARGE PORTION OF THE FOOD PRODUCED WAS NOT RESOLD BUT WAS CONSUMED BY THE LANDOWNERS, IT WAS NOT POSSIBLE TO DIRECTLY TAX THE FOOD. THE ONLY EFFECTIVE WAY TO TAX THE FOOD WAS BY LEVYING A "PROPERTY TAX" ON THE LAND. A PROPERTY TAX WAS THEREFORE A TAX ON PRODUCTION (LABOR AND PRODUCT) WHICH TODAY IS CALLED AN INCOME TAX.
THE INDUSTRIAL REVOLUTION AND THE CENTRAL BANKING SYSTEM EVENTUALLY CHANGED TAXATION METHODS IN ORDER TO TAX THE LABOR OF WORKERS WHO WERE NOT LANDOWNERS. A PERSON'S LABOR IN A FACTORY WAS MEASURED IN A CURRENCY, NOT IN FOOD PRODUCED ON A FARM. THIS LABOR WAS CALLED "INCOME" AND THE TAX ON CURRENCY WAS LABELED AN "INCOME TAX," HOWEVER, THE INCOME TAX REPRESENTED THE SAME THING AS THE 18TH CENTURY FRENCH PROPERTY TAX: A TAX ON A PERSON'S LABOR PRODUCT.
ITS INTERESTING TO NOTE THAT WITHOUT A MODERN CENTRAL BANKING SYSTEM AND FIAT CURRENCY, THE GOVERNMENT WOULD NOT HAVE THE ABILITY TO TAX A PERSON'S LABOR EFFECTIVELY AND WOULD HAVE TO REVERT TO PROPERTY TAXES. THIS WOULD BE MORE IN KEEPING WITH A "NON APPORTIONED TAX" SPECIFIED BY THE U.S. CONSTITUTION.
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