The Latest by David Cay Johnston
Facts Refute Filmmaker’s Assertions on Income Tax in ‘America’
| This story title is itself
an assertion. |
Aaron Russo, the producer of films like “Trading Places” and “The
Rose,” promotes his new film, “America: From Freedom to Fascism,” which
opened Friday, as having had its international premiere before a packed
audience “during the Cannes Film Festival.”
| I’m not checking the facts
on this assertion, since memory indicates this one might be correct. |
The film was not on the program at Cannes, however, not even for
screenings made under the festival’s aegis without being in the awards
competition. Mr. Russo, the film’s director, writer and producer, just
set up an inflatable screen on a beach. Photographs posted at one of
Mr. Russo’s Web sites depict an audience of fewer than 50 people spread
out on a platform on the sand.
How many times was the
film shown? When was the first showing? When was the last
showing? Which showing was photographed?
I personally watched the free pre-screening of this movie in St.
Charles, Illinois with about 700 others. This figure of 700 came
from
the theater operator. |
Hyping films with fanciful claims is nothing new in Hollywood. But
examination of the assertions in Mr. Russo’s documentary, which
purports to expose “two frauds” perpetrated by the federal government,
taxing wages and creating the Federal Reserve to coin money, shows that
they too collapse under the weight of fact.
Again, Mr. Johnston has
made an assertion.
Mr. Johnston has asserted
that what Mr. Russo shows in his film is not correct.
Mr. Johnston asserts
that the facts contradict Mr. Russo. Which facts
Mr. Johnston? The facts you believe on faith? The facts you
believe
that the actual written words
of the Statutes and Regulations
contradict?
Since this is assertion by a well known name from a well known paper,
are the people to just accept your assertion
that the facts do not
support Mr. Russo?.
Dear reader, let us move on and see what Mr. Johnston presents to
substantiate his
assertions. |
Still, at free showings the film has drawn long lines of people eager
to watch a documentary that feeds on the estrangement many Americans
feel from their government, especially those who believe they played by
the rules and yet see their finances strained or broken. Many of the
reviews in major newspapers have accepted as having some factual basis
the film’s main contention, that the government illegally extracts
income taxes, even though every court that has ever ruled on these
issues has upheld the constitutionality of the income tax.
Mr. Johnston acknowledges
that there is an “estrangement”
of “many
Americans … from their government.” Perhaps, Mr. Johnston,
some of
that estrangement comes from people like myself, to include Mr. Russo,
who have looked into the issue, and have actually taken the time to
study what the written words of law,
Statutes, and Regulations actually
say. When the law says one thing and the government ignores the
law
and does what it wants, then estrangement is on the mild end of
what is going to happen if the government does not get back into its
legal Constitutional box.
Mr. Johnston then makes one of his signature deliberate
misrepresentations of what the issue actually is. The issue is not,
nor has it ever been, “the
constitutionality of the income tax”. The
issue is the misrepresentation of what the tax laws actually say, and
the misapplication of those very same laws. But then,
misrepresentation is what you have been all about ever since you LIED
about Mr. Larken Rose’s position, even after he, and others, have
corrected you on your misrepresentations.
If the government does not follow the written
law when it “extracts
taxes”, then such extraction of taxes IS ILLEGAL. When the
government
does this, it violates due process, and thus violates the Constitution.
|
The film’s appeal, Mr. Russo said during a phone interview last week,
is not left or right, but concentrated among those who see the United
States evolving into a police state ruled by an oligarchy that has
tricked Americans into paying taxes.
| Once one has their eyes
opened by seeing the deliberate violations of
due process by the government, then the other tyrannical actions of
this government become easier to see. |
Not mentioned in the film is that Mr. Russo has more than $2 million of
tax liens filed against him by the Internal Revenue Service, California
and New York for unpaid federal and state taxes. Mr. Russo declined to
discuss the liens, saying they were not relevant to his film.
| They are NOT relevant to
the film. They ARE indicative of the very
problem the film seeks to expose. What you are doing here is poisoning
the well. You are attempting to sling mud on Mr. Russo because
you
don’t want the general public to view this movie and start asking
questions. You are attempting to discredit Mr. Russo in an attempt to
discredit the film. |
Early in the film Mr. Russo, the narrator, asserts that every president
since Woodrow Wilson and every member of Congress has perpetrated a
hoax to tax people’s wages and issue them dubious currency. All of the
federal income tax revenue, the film says, goes to these bankers to pay
interest on the national debt, even though by the broadest measure the
federal government’s interest payments are less than 40 percent of the
individual income taxes, according to an examination of every federal
budget since 1995.
| More assertions by
Mr. Johnston. Please provide citations where folks can find such
numbers on the internet. |
The film opens by calling the 16th Amendment and its subsequent income
tax and the Federal Reserve the product of a “silent coup
d’état” in
1913 by “international bankers.” In the style of low-budget television
documentaries, photographs appear on screen of J. P. Morgan, Paul
Warburg and John D. Rockefeller.
| “In the style of low-budget…”
More mud slinging Mr. Johnston? |
The documentary includes interviews with a host of people who are
presented as experts, scholars and whistle-blowers. All deny the
legitimacy of the income-tax laws, including Irwin Schiff, now serving
his third prison term for tax crimes.
| Mr. Schiff’s kangaroo
judge Dawson is quoted as saying to the effect,
“The law will not be discussed in my court room.” The jury never did
see the law that created the duty that Mr. Schiff failed to execute.
Perhaps Mr. Johnston, you would care to engage with me on those laws
that Mr. Shiff was alleged to have violated? I know you won’t because
the last thing you can have happen is for me to shred your credibility
by showing you the written words of
law do not support
your position. |
The cornerstone of Mr. Russo’s case is whether any law requires
Americans to pay income taxes on wages.
| Well Mr. Johnston, Which
law requires payment of income taxes on wages? |
Near the film’s beginning Mr. Russo says, and others appear on screen
asserting, that the Internal Revenue Service has refused every request
to show any law making Americans liable for an income tax on their
wages.
| Did you ever get an answer
from Mr. Everson? You asked him that
question and he just gave you blather. He did NOT answer the
question,
did he? Perhaps I missed it. Would you care to send me the answer? I
want Statute, Regulation, chapter and verse that makes me liable for an
income tax on my wages. |
Yet among those thanked in the credits for their help in making the
film is Anthony Burke, an I.R.S. spokesman. Mr. Burke said that when
Mr. Russo called him asking what law required the payment of income
taxes on wages, he sent Mr. Russo a link to documents, including Title
26 of the United States Code, citing the specific sections that require
income taxes be paid on wages. Title 26 says on its face that it is law
enacted by Congress, but Mr. Russo denied this fact.
Office of the Law Revision
Counsel states on their website:
Certain titles of the Code have been enacted into positive law, and
pursuant to section 204 of title 1 of the Code, the text of those
titles is legal evidence of the law contained in those titles. The
other titles of the Code are prima facie evidence of the laws contained
in those titles. The following titles of the Code have been enacted
into positive law: 1, 3, 4, 5, 9, 10, 11, 13, 14, 17, 18, 23, 28, 31,
32, 35, 36, 37, 38, 39, 40, 44, 46, and 49
Prima facie (at first glance) means that the Statutes-at-large are the
final authority of what the law is. |
“Title 26,” Mr. Russo said in an interview last week, “is not the law,
it is I.R.S. regulations and to be a law it has to be passed by
Congress.” Mr. Russo added that he had studied the matter closely and
was confident that he had the facts.
| How do I know you are not
making this stuff up? Didn’t Jayson Blair used to work for the paper you work
for? |
Arguments made in court that the income tax is invalid are so baseless
that Congress has authorized fines of $25,000 for anyone who makes
them. But even though the penalty was quintupled, from $5,000, it has
not deterred those who assert this and other claims that Congress and
the courts deemed “frivolous arguments.”
Again, you are
misrepresenting what the true position is.
Should I use Section 861(b) of the Code, and regulation 1.861-8 to
determine my domestic taxable income?
If the answer to the previous question is no, please state which
statute or regulations says who should, and who should not us those
sections to determine domestic taxable income?
Perhaps you can answer those two questions with your (alleged) superior
knowledge of the tax law, Mr. Johnston.
Do those two questions look “frivolous” to you, the readers of this
open letter to Mr. Johnston?
Here is the website URL where I have posted those 2 of 6 questions, and
the governments response:
http://www.synapticsparks.info/oldsite/861/6Q.html
Mr. Johnston, since you speak for the government (much more than a
reporter should) perhaps you can justify such a response to six simple
questions about the law? |
The film also states repeatedly that people are tricked into paying
income taxes because no law makes them liable for taxes. The tax code
uses the word impose, whose definition includes the concept of
liability, courts have held in published decisions.
| And the citation numbers
of the court cases that support Mr. Johnston’s naked assertion is? |
The film includes the voice of this reporter, off camera, asking the
I.R.S. commissioner, Mark W. Everson, to answer protesters outside the
Treasury building who wanted to know what law makes them liable for
taxes. Mr. Everson then makes rambling comments without, as the film
notes, answering the question.
If my
memory serves me, the film had the footage when YOU asked Mr.
Everson
that question. No, Mr. Johnston, Mr. Everson does
not answer the question. And Mr. Everson did ramble about, the
entire time NOT
answering the question. Dale Hart then stepped in and gave the URL for
that UNOFFICIAL pack of lies on the IRS’ website.
So, for the record, Mr. Johnston, what law makes a Citizen exchanging
labor for money in any of the several states, “liable” for paying the
“income tax”? |
Mr. Russo also said that “Congress has no authority to tax people’s
labor.” Article I, Section 8 of the Constitution begins with the phrase
“The Congress shall have the power to lay and collect taxes.”
Only three limitations are placed on that power, none of which bars a
tax on wages. One limitation, however, was a requirement that taxes be
“apportioned among the several states.”
The old “bait and switch”
Mr. Johnston? Labor is NOT wages. Wages is
NOT labor. And since we are on the subject of wages, would you
care to
discuss the STATUTORY DEFINITION of WAGES?
You also seem to be ignorant about the difference between a “direct”
tax and the “indirect” forms of taxation. I do look forward to
that
civil discourse if you have the guts to engage on the facts of the
WRITTEN STATUTES and REGULATIONS. |
The 16th Amendment repealed apportionment, …
“The 16th Amendment
repealed apportionment…” No Mr. Johnston, it did
not. The following was from STANTON v. BALTIC MINING CO, 240 U.S. 103
(1916)
But, aside from the
obvious error of the proposition, intrinsically
considered, it manifestly disregards the fact that by the previous
ruling [Brushaber v. Union Pacific Railroad] it was settled that the
provisions of the 16th Amendment conferred no new power of taxation...
And what did the previous ruling of BRUSHABER v. UNION PACIFIC R. CO.,
240 U.S. 1 (1916) say?
We are of opinion,
however, that the confusion is not inherent, but
rather arises from the conclusion that the 16th Amendment provides for
a hitherto unknown power of taxation; that is, a power to levy an
income tax which, although direct, should not be subject to the
regulation of apportionment applicable to all other direct taxes.
Note that what the Brushaber Court is specifically addressing a direct,
unapportioned tax
And the far-reaching
effect of this erroneous assumption [that the 16th
Amendment provides for a direct, unapportioned tax] will be made clear
by generalizing the many contentions advanced in argument to support
it, as follows:
(a) The Amendment
authorizes only a particular character of direct tax
without apportionment, and therefore if a tax is levied under its
assumed authority which does not partake of the characteristics exacted
by the Amendment, it is outside of the Amendment, and is void as a
direct tax in the general constitutional sense because not apportioned.
But it clearly results
that the proposition [The "erroneous assumption
above] and the contentions under it,
if acceded to, WOULD CAUSE ONE
PROVISION OF THE CONSTITUTION TO DESTROY ANOTHER; that is, they WOULD
RESULT IN BRINGING THE PROVISIONS OF THE AMENDMENT exempting a direct
tax from apportionment INTO IRRECONCILABLE CONFLICT WITH THE GENERAL
REQUIREMENT that all direct taxes be apportioned.
Moreover, the tax
authorized by the Amendment, being direct, would not
come under the rule of uniformity applicable under the Constitution to
other than direct taxes, and thus it would come to pass that the result
of the Amendment would be to authorize a particular direct tax not
subject either to apportionment or to the rule of geographical
uniformity, thus giving power to impose a different tax in one state or
states than was levied in another state or states.
This result, instead of
simplifying the situation and making clear the
limitations on the taxing power, which obviously the Amendment must
have been intended to accomplish, would create radical and destructive
changes in our constitutional system and multiply confusion.
More info.
|
The 16th Amendment repealed apportionment, but Mr. Russo says in the
film that the 16th Amendment was never properly ratified and thus a tax
on wages is unconstitutional. This claim has been made in various forms
by thousands of tax protesters since 1913, and so far their batting
average with the courts is .000.
The 16th Amendment was NOT
properly ratified. Perhaps you should read
Mr. Benson’s book: “The Law That Never Was”. And of even
more
interest, is the box the government has painted itself into with its
ignorant inquisition of Mr. Benson.
http://www.thelawthatneverwas.com/new/home.asp
And regardless of whether the 16th Amendment was, or was not properly
ratified, it does NOT matter since the 16th does NOT allow for a
direct, unapportioned tax. |
To buttress the claim that the 16th Amendment is invalid, the film
displays a quotation from a federal district judge, James C. Fox. But
the transcript from which the judge’s words were taken shows that while
he spoke those words, they were in the context of laying out issues and
that the conclusion he reached was the opposite of the words quoted.
| The citation for that
court case is? Your not giving the readers links
to information so they can study the issue in more detail. Why is that
Mr. Johnston? |
Judge Fox, the transcript shows, concluded that no court would accept
any argument that the 16th Amendment was not properly ratified and
therefore invalid.
And I find that transcript
where?
Regardless, your conclusion is wrong.
United States v. Benson, 941 F.2d 598, 607 (7th Cir. 1991), held that
the ratification of the Sixteenth Amendment was a nonjusticiable political question that was “beyond review” by
the federal courts.
The court’s refusal to touch that hot potato does NOT prove that the
16th Amendment was properly ratified, it only proves that the Courts
won’t engage the question. |
The film includes a brief interview with Sheldon Cohen, who was I.R.S.
commissioner in the Johnson administration. Mr. Cohen said Mr. Russo
used editing that “ twists my views” to create a false impression. Mr.
Russo said he considered the assertion laughable.
| What was that question?
Oh, yeah… What law makes me liable? Care to answer it Mr. Johnston? |
Mr. Russo was Bette Midler’s manager for seven years early in his
career and has produced music as well as films. He also sought the
Libertarian Party nomination for president in 2004 but dropped out
because of ill health.
Despite hundreds and perhaps thousands of tax protesters going to
prison, and many more losing their homes and life savings, the movement
appears today to be more widespread than ever.
| Perhaps, Mr. Johnston,
those of us who have taken the time to study the WRITTEN WORDS OF LAW
know that the government is misapplying the law,
and getting convictions by keeping those WRITTEN WORDS OF LAW out of
the courtroom. Surely as the expert tax reporter for the NY
Times, you
should be able to rebut anything I have to say on the issue quite
quickly if I am wrong. |
“The tax protest movement is like a cult,” said J J MacNab, a Maryland
insurance analyst who is writing a book about protesters and who has
sat through six trials of people prosecuted for refusing to pay taxes
under the theories espoused by Mr. Russo’s film.
Hearsay assertions
now. Aren’t you the fine reporter.
I doubt Ms. Macnab has the guts to engage in discourse with informed
Tax Honesty Advocates any more than you do.
|
One tax protester featured in the film, Irwin Schiff of Las Vegas, is
now serving his third prison sentence after being convicted of tax
evasion crimes. Mr. Schiff introduced into his criminal case the notes
of his psychiatrist, who wrote that Mr. Schiff was a successful tax
shelter salesman until a con artist ripped him and his clients off. The
psychiatrist concluded that Mr. Schiff became delusional, believing he
alone could properly interpret the tax code, as a way to avoid
acknowledging reality.
| Really now, Mr. Johnston.
You are being a fascist whore with your mud slinging. Oops, I
have slipped to your level. |
Later, one of Mr. Schiff’s confederates, who was also later convicted
and sent to prison, sent e-mail messages to supporters saying that the
psychiatrist’s notes were introduced as part of a ruse to help Mr.
Schiff escape prosecution.
| Mud slinging still. How
about that discourse on the WRITTEN
WORDS OF LAW, Mr. Johnston. |
Ms. MacNab, who has testified before Congress, said that at each of the
trials prosecutors showed how the accused took out of context sections
of the law and court decisions while ignoring other sections, including
those shown to them by I.R.S. agents.
| And those other sections
are, Mr. Johnston? |
“People who are drawn into this movement just refuse to acknowledge
facts that show their beliefs have no basis in fact,” she said. “Most
of them have failed, their business has failed, their marriage has
failed, and instead of taking responsibility for it they want to blame
the government.”
Hearsay assertions and
second hand mud slinging.
|
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