Patricia Johnson-Holm wrote:2. Going the direction even with taxing the imports and excise taxes as provided in the 1789(1871) version of the Constitution would NOT pay for current expenses, let alone pay the enormous so called 'national debt.'But you do not mention the use of the power of
direct taxation which the founding fathers intended to be used if indirect taxation did not raise sufficient revenue to meet the public exigencies.
As pointed out in
EXPOSING THE FAIR TAX HOAXCareful research into our Nation's early legislative history reveals the Framers did in fact provide Congress with an emergency power available to be used if deficits should arise. And the wisdom of the Framer's method, unlike the proposed balanced budget amendment (S.J. RES.1), contains a brilliant mechanism which would abruptly end Congress' current profligate spending habits! Under the Framer's plan, whenever the monies arising from Congress' normal taxing powers (imposts duties and excises) are found insufficient to fund federal expenditures during a fiscal year, and a deficit is produced by Congress borrowing to finance expenditures, Congress must then use its direct taxing power at the beginning of next fiscal year to raise an amount sufficient to retire this deficit. Congress is required to follow the rules of apportionment when imposing this tax, and bills each state for a share of the deficit. Each State must contribute a share of the total deficit in proportion to its allotted number of Representatives as set forth in Article I, Section 2, clause 3, of the United Constitution. The more votes a State exercises in the House, the larger is its share toward extinguishing a deficit . . . representation with proportional obligation! FOUNDING FATHERS' FAIR SHARE FORMULA The states are left free to raise their share of the tax in their own way, within a time period set by Congress. But if any state shall neglect to pay its share, then Congress must send forth its officers to assess and levy that state's apportioned share, together with interest thereon. Legislative HistoryThis method of extinguishing deficits appears in seven of the ratification documents which gave life to the United States Constitution. The first emergency direct tax was imposed in 1798, to extinguish part of the Revolutionary War debt. It was later used during the War of 1812, and also to extinguish deficits during the Civil War
The Sixteenth Amendment to the United States Constitution did not repeal or alter Congress' power, or obligation, to impose the emergency direct tax should a deficit arise. The power of Congress to impose a direct tax still exists, and direct taxes are still required to be apportioned among the states, as pointed out by the United States Supreme Court [see Stanton v. Baltic Mining Co., 240 U.S. 103, 103, (1916; Eisner v. Macomber, 252 U.S. 189 (1920); and, Bromely v. McCaughn, 280 U.S. 124 (1929). Also see Congressional Research Service Report No. 84-168 A 784/275, which was updated September 26, 1984].
Big Advantages
There is no smoke and mirrors with the 'FAIR-SHARE' method of balancing the budget. The emergency direct tax ought to be statutorily imposed whenever Congress closes a fiscal year with a deficit. The structural mechanism which would immediately bring fiscal sanity to Congress is the requirement of having Congress send a bill to the Governor of each state, notifying him/her to remit the state's apportioned share toward extinguishing the deficit created during the year by Congress; the governors and state legislators being left with the burden of having to raise this money, and to send it off to Washington, D.C.
Picture, for a moment, the expression on the faces of the Governor of New York and the New York State Legislature, if New York should receive a bill for its apportioned share [31/435] of the 1995 federal deficit. This threat would create a compelling incentive for the Governor of each state, and the various state legislatures, to keep a jealous eye on the spending habits of their Congressional Delegation . . . it would require the fiscal accountability which the state governments once demanded from their Senate and House Members!
In addition, because each state's share of the tax burden is determined by a fixed rule, similar to that which determines the House membership size of each state, a barrier is erected preventing the kind of mischief which Congress now practices, i.e., discriminatory tax legislation; pork-barrel favoritism; special interest lobbying, etc
Bottom Line
The Framers of the Constitution provided a specific method available to extinguish anticipated deficits through an emergency direct tax. Hamilton, in No. 36 of The Federalist Papers, reminds us:
"Let it be recollected that the proportion of these taxes is not to be left to the discretion of the national legislature, but is to be determined by the number of each State, as described in the second section of first article [United States Constitution]. An actual census or enumeration of the people must furnish a rule, a circumstance which effectively shuts the door to partiality or oppression. The abuse of this power of taxation [direct taxation] seems to have been provided against with guarded circumspection." (EMPHASIS ADDED)
