Guest Post: "All Transactions To Be Conducted In The Presence Of A Tax Collector"

Tyler Durden's picture

Submitted by Simon Black of Sovereign Man

All Transactions To Be Conducted In The Presence Of A Tax Collector

In the terminal collapse of the Roman Empire, there was perhaps no greater burden to the average citizen than the extreme taxes they were forced to pay.

The tax 'reforms' of Emperor Diocletian in the 3rd century were so rigid and unwavering that many people were driven to starvation and bankruptcy. The state went so far as to chase around widows and children to collect taxes owed.

By the 4th century, the Roman economy and tax structure were so dismal that many farmers abandoned their lands in order to receive public entitlements.

At this point, the imperial government was spending the majority of the funds it collected on either the military or public entitlements. For a time, according to historian Joseph Tainter, "those who lived off the treasury were more numerous than those paying into it."

Sound familiar?

In the 5th century, tax riots and all-out rebellion were commonplace in the countryside among the few farmers who remained. The Roman government routinely had to dispatch its legions to stamp out peasant tax revolts.

But this did not stop their taxes from rising.

Valentinian III, who remarked in 444 AD that new taxes on landowners and merchants would be catastrophic, still imposed an additional 4% sales tax... and further decreed that all transactions be conducted in the presence of a tax collector.

Under such a debilitating regime, both rich and poor wished dearly that the barbarian hordes would deliver them from the burden of Roman taxation.
Zosimus, a late 5th century writer, quipped that "as a result of this exaction of taxes, city and countryside were full of laments and complaints, and all... sought the help of the barbarians."

Many Roman peasants even fought alongside their invaders, as was the case when Balkan miners defected to the Visigoths en masse in 378. Others simply vacated the Empire altogether.

In his book Decadent Societies, historian Robert Adams wrote, "[B]y the fifth century, men were ready to abandon civilization itself in order to escape the fearful load of taxes."

Perhaps 1,000 years hence, future historians will be writing the same thing about us. It's not so far-fetched.

In the economic decline of any civilization, political elites routinely call on a very limited playbook: more debt, more regulation, more restriction on freedoms, more debasement of the currency, more taxation, and more insidious enforcement.

Further, the propaganda machine goes into high gear, ensuring the peasant class is too deluded by patriotic fervor to notice they're being plundered by the state.


                         
And just in case anyone falls out of line or starts thinking too much, they give a handful of people badges, weapons, and the authority to terrorize the population.
                                
Whether direct taxation in the form of outright theft, or indirect taxation in the form of inflation, these tactics have been used for millennia to maintain privilege for an elite few at the expense of everyone else.

This time is not different.

At $780 billion, the US government's budget deficit for just the first six months of FY2012 is more than the entire GDP of Indonesia. This is absurdly unsustainable, yet there is no end in sight to reckless spending habits... let alone paying back what's owed.

Meanwhile, a whopping $5.5 -trillion- worth of US debt is maturing over the next three years. And it's unlikely that foreigners will continue to generously loan their hard earned savings to Uncle Sam at sub-inflation rates.

Further, given the millions of new entitlement recipients, it's unlikely that intragovernmental agencies like Social Security will have the cash flow available to mop up any meaningful portion of this debt.

That leaves the old tried and true options-- direct confiscation from the people through debilitating taxes and capital controls, and indirect confiscation through painfully higher inflation.

Like the 5th century Romans before us, people may be ready to abandon civilization itself to escape the burdens placed on them by today's ruling class. Only, by the time this happens, it may be too late to start doing anything about it.

Every day it becomes harder to take actionable steps towards safeguarding freedom. It becomes harder to open a foreign bank account, to move and store gold abroad, to purchase firearms... even to travel abroad or renounce your citizenship.

Doing what politicians do-- kicking the can down the road-- is really going to limit your options in the future. But taking some simple steps today will pay huge dividends in the years to come.

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Alcoholic Native American's picture

It's crazy, all my government employee and government contractor friends agree, they are being taxed to death.

Gully Foyle's picture

Alcoholic Nativ...

It's crazy, all my government employee and government contractor friends agree, they are being axed to death.

Diplodicus Rex's picture

Sorry. I re-read your post more carefully. I thought you said 'taxed'.

Diplodicus Rex's picture

Government employees do not pay tax despite what their salary slip tells them. They are only ever paid the net value at the bottom of the slip. The gross value at the top was never paid to anyone. The deductions are an accounting sleight of hand to make them feel part of the real tax-paying part of the population.

Gully Foyle's picture

Diplodicus Rex

In the digital age pretty much everything is sleight of hand.


Diplodicus Rex's picture

You're leaning on an open door there.

Zero Govt's picture

i fell through the doorway about 2 years ago to enlightenment

Don't Pay Taxes ...don't feed the suckers/slackers

Popo's picture

You seem foolishly confident of your anonymity.

Real Money Wins's picture

Just look at all the laws and executive orders they are passing!

 

They are scared!!!   The Barbarians are at the gate!

 

"If you will not fight for the right when you can easily win without bloodshed; if you will not fight when your victory will be sure and not too costly; you may come to the moment when you will have to fight with all the odds against you and only a small chance of survival. There may even be a worse case: you may have to fight when there is no hope of victory, because it is better to perish than to live as slaves."
  --  Winston Churchill

If you are reading this YOU are the RESISTANCE!!

Paul Bogdanich's picture

This athour is roundly considered rather dull.  Apart from believing that the Bush tax cuts were good for the economy and had no effect on the deficit he rants on about stuff he has clearly never even read about like Rome.  None of his historical claims about Diocletian are true.  Diocletian is roundly credited with reforming the Empire so it lasted several hundred years more so that Constantine could reform it again.  What Diocletian did do was revoke all the favored tax positions of all the Patrician classes or what we today call tax breaks and loopholes.  Diocletian made everyone pay the same taxes and those who did not want to acknowledge thier responsibility to the Roman people were purged.  Jews and Christians mostly.  My how things haven't changed.      

pcrs's picture

aha, roundly credited, then it must be true. Like it is roundly credited that the Bush tax cuts were tax cuts for the rich? That roundly credited?

CH1's picture

Roundly considered!

Well then, my opinion must be wrong!

 

midtowng's picture

I don't know about Diocletian, but I do know that at the end of the Roman Empire the rich weren't paying taxes at all. Only the working stiff. Thus what the author said about the peasant siding with the barbarian invaders is correct.

Popo's picture

Taxation is a form of peasant-exploitation. And property-taxes are remarkably similar to serfdom in so many ways. In the USA there is no such thing as land ownership. (stop paying taxes and the real owners will present themselves shortly).

And yes, Simon Black is a bit of a douche. But at least this piece was interesting. His standard "it's better over here" pieces have gotten very old.

psychobilly's picture

@Paul Bogdanich - "Reforming the empire." 

Right.  Diocletian "reformed" the empire by greatly increasing the size of the Roman military and civil bureaucracy to such a degree that the crushing tax burden caused rich and poor alike to evade taxes any way they could.  To the dismay of the grasping, pea-brained statist, this is a perfectly natural, expected and inevitable reaction to rapacious government. 

Tax evasion always increases along with the tax burden.  In fact, it acts as a safety-valve against rebellion.  Since the rich will always have means to escape heavy taxation, the burden of bloated government bureaucracy will eventually fall the heaviest on those of lesser means.  Diocletian's "reform" of the tax system led to forced contributions of labor and produce in rural districts... i.e., serfdom.

In order to address the rampant inflation that the Roman state had caused in the first place (by expanding the money supply via currency debasement), Diocletian further "reformed the empire" by implementing a vast, all-encompassing system of wage and price controls, with the death penalty for violators.  These "reforms" were an abject failure: four years later the price of gold in terms of the denarius had risen 250 percent.

People seeking to "reform" the economy in the manner of a Diocletian should be shot in the face. 

CrockettAlmanac.com's picture

I like my history with an edge. Well done.

Zero Govt's picture

this is history with an edge of Govt = national destruction

funny but though it's occured 100's of times in history, even present day, the reason for the demise of so many countries (Govt sucking economies/people to destruction) is never taught in State schoools

wonder why?

Chuck Walla's picture

Yes, I can see Obama wanting to purge his world of Christians and Jews....

Buck Johnson's picture

And what teh OP said is going to happen here and it will be nasty.  People will leave the US to anyplace in order to have freedom.  Then the US will break apart into 6 to 8 areas of control that will be ruled by a strong man.  Our great experiment is done, we failed.  We weren't special, we where just fools who believed in the delusion that they gave us.

libertus's picture

Welcome to the USSA Bitches!

hedgeless_horseman's picture

 

 

I just filed my Federal income taxes, no state income tax in Texas, and my actual effective tax rate for last year was just slightly more than 21%. 

This does not include the Inflation Tax I also paid.

Simon, which one of the two countries with lower individual tax rates do you recommend I move to?  Korea (South?) or Mexico?

http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

Gully Foyle's picture

hedgeless_horseman

If I understand it right, the rich pay less taxes than the middle class because they have accountants and attorneys which use every loophole and nuance.

So really it isn't about how much you get taxed, it's about how bright you are to use your resources and avoid paying taxes.


hedgeless_horseman's picture

 

 

...every loophole and nuance.

 

Thank you for your payment and for choosing TurboTax as your tax preparation solution. We appreciate your business! A summary of your charges is listed below.

TURBOTAX ONLINE DELUXE TY2011 PREP $49.95
Subtotal: $49.95
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Harlequin001's picture

My effective tax rate is once again, and has been for the last nine years - 0%.

You won't find this in individual tax rates but in exemptions to tax legislation in various parts of the world. There are places that do not tax non domestic sourced income and gains but you have to look. Are you prepared to comply with the rules on residence?

The difficulty for Americans s the deeming provisions or 'CFC' legislation that relates to profits earned by a beneficially owned foreign sourced entity. Sort that one and you have your tax free income even if you are American and US resident...

seek's picture

I'm very bright, and have a top-tier CPA and lawyer and am a 1%er. My effective tax rate is ~34%.

It really isn't about how bright you are or using your resouces, it's about where your money comes from.

In a nutshell, if you earn your income, you are fucked. The system is set up explicitly to steal from producers, and/or reward fraud by lying about income (and not just to the IRS, lying in the other direction, with no-doc loans, got rewarded pre-crash, as well.)

If you don't earn your income and it instead comes from capital gains, then you get to start playing serious games with accounting, and the tax system will treat you very favorably. This is how Buffet, Romney, Obama, et al end up paying less taxes than their secretaries. The secretaries are earning their income, the bosses are not. Just make sure it's the right kind of capital gains -- the kind that support TPTB -- and you're good to go. If it's the wrong kind, say profits from holding PMs, then guess what? Fucked again.

 

narapoiddyslexia's picture

It needs to be the opposite, does it not? With earned income from time spent working, taxed at a flat 15%, and passive income taxed at a graduated rate, the top marginal rate being 75%.

yakmerchant's picture

Really?  Why should passive income be taxed at all?  The whole idea that when I buy something for $100 and then due to Bernanke Ben printing funny money and his manufactured inflation when I go to sell that object, now it's "Value" in Benny Bucks is  $200, I should have to give uncle sam 25%-75% of the fake change in value?  Complete BS.  They would love nothing more to tax you more through manufactured inflation.  You will probably get what you wish for.

And let's just pretend that the whole f.ck you through inflation game didn't exist.  You start taxing passive income at 75% and let's see how many of those "earned income" jobs disappear.   I know many people that could retire on a beach tomorrow, they however choose to start new businesses (or invest in those starting new businesses).  If you go to those people and say,  hey I want you to invest 10 million dollars in my business and if the business fails you lose it all, but even better if it's a wild sucess you only get 25% of your share of the profits because uncle greedy is handing out free stuff to the proletariat.  Risk reward goes upside down job creation goes with it.    Just another way to make sure government destroys the efficient investment of capital.

 

Harlequin001's picture

Capital Gains Tax is a crime against humanity...

Offtheradar's picture

I'm with you Seek.  I'm in the same position.  It's all fucked up.  Successful small business owner here taking it in the rear. 

Dane17's picture

Second the above. If you are a high earning working professional you have no"loopholes".

robobbob's picture

The entire tax structure is biased. "Loopholes" are built for specific activities and with certain value thresholds in mind that the average person will never qualify for.

To summarize, anyone who earns income by making or producing anything, other than certain targeted green technology, is screwed.

 

Zero Govt's picture

There is no correct tax or 'fair' tax structure. Period.

You never needed Govt, you've never used Govt or phoned a politician for help... nor will you because you know they do not represent you.

Tax is theft enforced by thieves and their crones.

The sooner we stop paying taxes the sooner the problems go away and the sooner recovery (from Govt and its monpolists) begins in earnest

Govt is the biggest socio-economic mistake in history. It's entirely a destructive institution, check the history books for a thousand in-your-face examples

blindfaith's picture

Every year I help several dozen locals do their taxes. These are 'shop people', artists, and assorted folks who do not make over about 18K a year. Returns are very simple. The last few years all these people qualified for the 1040, Schedule M benefit "make work pay" program. Simply put, If you worked, you could qualifiy for up to 400.00 tax credit....even if you made up to 75,000 income.

Three-forths in this county make less than 40K. A NET NET 400.00 tax credit on less than 18K GROSS ( more like 12K net) income is serious money.

Well, the famous and fussed about "Bush tax break" extension seems to have left out (or did not renew) this credit. So each one of these folks are, in effect, paying 400.00 more this year ( and no, other 'adjustments to income' did not make up for this, bottom line). I have not seen so many stunned, angry, and dismayed faces who feel that the rich got the tax breaks and they didn't. Say what you will, but they do have a point. 

So, when the 'consumer doesn't seem to be spending' (gee wiz surprise) data comes out, weigh in this little factoid along with declining savings, increased card debt, gas up 20% since the new year, and all the other 'real' cost of living. I can't help but feel that a triple dip recession is hiding behind a tree and maybe others deep in the forest yet to be seen. The backbone of the spending multiplier effect in America is in trouble, but Washington just doesn't get it, especially uncle Ben.

aerojet's picture

The US Senate doesn't get it either--the US postal service was going to undertake some serious reforms driven by internal bureaucrats, but the Senate intervened and postoned all of the cuts.  We will just borrow more money to keep the dying postal service alive a few months longer.  We badly need reforms, but nobody will do the right thing.

KickIce's picture

Blindfaith:  Agreed up to the last sentence.

OpenThePodBayDoorHAL's picture

I moved to Australia in 2005 and gave up my US passport. 3 hours flight from Sydney is the nation of Vanuatu, a tropical paradise with *no* income tax. If I am in Vanuatu for six months and one day per year, then I am a non-resident for Australian tax purposes which means I do not pay Australian income tax. In Vanuatu I get broadband internet, better mobile reception than Sydney, great French bakeries, a wild and friendly and wacky expat community, everyone from a board member of Pfizer to survivalists from Idaho, big fun and a busy social calendar. So it is possible.

Hi Ho Silver's picture

Thanks, but I'm allergic to earthquakes.

OpenThePodBayDoorHAL's picture

Australia just changed the rules so that professional qualifications and licenses (like medical or construction or accounting certifications etc) can be established before you arrive. That gets you a 4-year work visa, which then leads to Permanent Residency which then leads to citizenship. Unemployment just dropped from 5.3% to 5.1%, more like less than 1 or 2% if you're willing to live in a remote area and work in mining or energy. Truck drivers for the remote mines will pull down >$300K per year easy. Minimum wage nationwide is $17.00.

Not a commercial for Australia, it's got plusses and minuses like everywhere, just some info people might use.

Freddie's picture

Where do I sign up for Australia.  I had it with Hope and Change.

 

CrockettAlmanac.com's picture

Sounds like the set up for a Vonnegut novel. So it goes.

geekgrrl's picture

You're lucky, I'm in Oregon w/ 9% income tax. My effective rate is 33%. I am so tired of this. Four whole months of my labor stolen by the government each year. That also doesn't include the inflation tax.

Bring on the barbarians. I'll stand beside them and fight.

Abiotic Oil's picture

And with the PERS pension fund heading for insolvency I'm sure Kitzhaber would love to raise it even more.

At least we don't have a sales tax, but they'll try that again too.

geekgrrl's picture

I'm sure there will be all sorts of new taxes, of that I have no doubt.

It was really an eye-opener when I moved from Washington to Oregon at basically the same salary. Whack, 9% reduction in income. I loved living in Washington since I am so frugal I paid almost nothing in sales taxes, relative to my income. I'm seriously considering moving back there if I don't leave the country first.

Miffed Microbiologist's picture

Wow geekgrrl, what a dumb move! Well, I can top you in stupidity. We moved from Washington state (Spokane) to CALIFORNIA.We're paying 10percent income tax on top of Federal, AMT, 8.75 percent sales. All because I couldn't take the climate. I wanted to return to my sunny state of my youth! Well in1982 CA was a much different state. Luckily hubby's 100 acre farm is paid off and,hopefully, we'll have a chance to inherit it and move back. It's the least I can do for him putting up with being taxed raped for 30 years. Of course if we do manage to return to Spokane, WA may get a state income tax passed. Seems like there are fewer and fewer places to hide and live under the radar. I hope you make it back!

Miffed:-)

Lucius Cornelius Sulla's picture

The left nuts tried to pass an income tax in 2010 through a referendum.  It failed with 65% of the electorate voting against.  Seems the Spendocrats don't like paying for their ideology.  Washington State is safe for now, thank God.  But if the wackos in Seattle and Olympia had their way they would all have us reading the little red book.

Miffed Microbiologist's picture

Thank goodness there are a few sane people left in WA. My mother in law kept us updated on that referendum and we were encouraged when it failed. Unfortunately there aren't 65 percent sane people in CA anymore. Hubby and I vote here just for entertainment value. If any of the candidates or propositions we vote for succeeds we take a drink. Well last year I think we had one and the year before, none. I proposed not doing it this year because after CA elections i want to be plastered. Not that anything would change even if our candidates of choice got elected, system's too screwed up at this point.

geekgrrl's picture

Hehe. Yea. The climate here is relatively mild with lots of water, but I'm originally from the east coast and I don't know how much longer I can deal with the constant clouds and virtually endless rain. I can appreciate why you'd like to live where there's sun. How can you put a dollar figure on that? Last Spring, it got so bad that I kind of freaked out and just jumped in the car and drove south until I saw the sun. Fortunately it was around the Redwoods in No CA, and I had two days of utter, absolute bliss, by myself in the Redwoods.

You're right about fewer and fewer places to hide, but as things degrade in this country Simon Black's message seems to be resonating more and more with me, namely: get out while you can. Problem is I'm not a 1%er, so I have to rely on my wits rather than my money. We'll see how far that goes... :-)

Lucius Cornelius Sulla's picture

Take up skiing (downhill or cross-country).  Plenty of sun in the east Cascades.

Miffed Microbiologist's picture

Wow do I hear you! This is my hubby's greatest fear moving back. Finding me in a fetal position rocking and mumbling incoherently after a month of no sun. We are trying to figure out an escape during these times but, like you, we do not have the resources to have a residence in both states. We're still flirting with the idea moving to CO Durango area. Great skiing and wonderful grounded people and they hate texans rather than californians! Climate is a bit better for my taste. I just never want to be forced to crawl back to CA with my tail between my legs, that would be my hallow point bullet moment.

Miffed:-)