Hello! Our Incomes Are Private Property Too
When we think about property, most of us think of land, structures and other tangible things. That those are the things that make up “private property” as protected by our Constitution.
The Fifth Amendment states: “…nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
America’s Founders understood clearly that private property is the foundation not only of prosperity but of freedom itself. Thus, through the common law, state law, and the Constitution, they protected property rights — the rights of people to acquire, use, and dispose of property freely.
Property is not just land, buildings, and other structures. We also have patent and copyright laws granting property rights to ideas and the expression thereof. You could say that free speech is actually a property right in that vein in this country.
We all know about ‘eminent domain.’ It’s when a government takes over property held privately. Road and rail construction are the bulk of the reasons when eminent domain is exercised, but there are others, recently including low rent housing. As the Constitution allows this to happen, it also requires ‘just compensation.’ We won’t get into the exercise of reviewing ‘just compensation’ today, but there are plenty of examples when that requirement leaves open the question of whether the government involved paid the property owner fairly at market value.
What I’m up to today is talking about the private property represented by our wages, income and savings.
You’re right, we normally don’t think about our money as our private property, but it is. How does this happen? Why don’t we think of our cash and investments as private property? The fact is, we should. What we earn and what we save and what, how and where we invest is our business, our property.
So, going back to the Constitution, we know the government can take our private property but only when just compensation is given to us.
While there was an income tax passed in 1861 to pay for the Civil War, it’s the Revenue Act of 1913 that represents the modern version.
That Revenue Act defined income in Sec. 22(a). “Gross income” includes gains, profits, and income derived from salaries, wages or compensation for personal service (including personal service as an officer or employee of a State, or any political subdivision thereof, or any agency or instrumentality of any one or more of the foregoing), of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, or sales, or dealings in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatsoever.
Pretty much covers it, right?
The federal income tax rates in 1913 were as follows:
1% on income of $0 to $20,000
2% on income of $20,000 to $50,000
3% on income of $50,000 to $75,000
4% on income of $75,000 to $100,000
5% on income of $100,000 to $250,000
Just for perspective, $20,000 in 1913 would be worth over $630,000 today, and the average household income then was $800.
The lowest federal income tax rate in 2024 was 10%, the highest was 37%.
It just so happens that 1913 also saw the passage of the 17th Amendment, whereby Senators were elected directly by the populous, rather than by State legislatures.
Since then, senators joined Representatives in Congress not on by representing the independence of their states, but also petitioners to the federal government to get back any of the money they can that’s been taken into the single treasury by the income tax.
Through all the machinations of time and practice, the income tax is not considered the taking of private property, and therefore the taxpayers are not entitled to just compensation. The emphasis has been on such things as taxing the rich because they can afford it and paying one’s ‘fair share.’
It’s like we owe the federal government a piece of our private property out of the chute that our government obviously no longer considers private.
It’s past time we emphasize what we’re getting in return. The federal government owes us ‘just compensation’ for taking our private property.
******************
Have a great and prosperous week.
Hug somebody.
References:
https://www.law.cornell.edu/constitution/fifth_amendment
https://www.in2013dollars.com/us/inflation/1913?amount=20000
https://en.wikipedia.org/wiki/Seventeenth_Amendment_to_the_United_States_Constitution
SPIDER Bytes
This week’s trivia question is: What is the world’s fastest bird? The answer to last week’s question re: the title of the classic Greek epic attributed to Homer, telling the story of the Trojan War. Iliad. Set towards the end of the Trojan War, a ten-year siege of the city of Troy by a coalition of Mycenaean Greek states, the 24-book poem depicts significant events in the siege’s final weeks. It depicts a fierce quarrel between King Agamemnon and a celebrated warrior, Achilles. Along with Odessey, it’s considered the oldest piece of European literature.
Global ‘cooling’ raised its ugly head again last week in Florida and across the SE. Pensacola, Jacksonville and other northern cities in the state received 4-9 inches of snow to go along with a month of well below seasonal temperatures. New Orleans got 10 inches of the white stuff normally reserved for climes further north.
A flurry of rescinding President Biden’s EOs and issuing new ones marked the first week of President Trump’s second tenure in the Oval Office. The new EOs were primarily aimed at immigration control and energy but included closing all DEI operations, ordering the 50% of federal employees back to work full time who haven’t been since COVID, and pardons and/or commutations for jailed January 6 rioters and pro-life advocates.
As Trump made his inaugural address last Monday outgoing President Biden issued additional pardons, including preemptive pardons for the Biden family, the former House January 6 Committee leadership and members, and Anthony Fauci. Specifically, a preemptive pardon is pardoning someone before they’ve even been investigated for, much less convicted of, a crime. It’s all legal, but really?
The CEOs of three big tech companies, OpenAI, Oracle, and SoftBank, last week committed to investing in AI infrastructure in the US. As a joint venture named Stargate, they announced the plans at a White House ceremony with President Trump to invest up to $500 billion over the next four years and estimated these AI operations will add 100,000 jobs in the US. The first data center will be in Texas. Other tech firms like Microsoft, MGX, Arm Holdings and Nvidia were named partners in Stargate – which will operate with a separate CEO and Board. Imagine that all without government spending a dime.
According to this month’s Florida Trend, the state’s largest supplier of electricity, Florida Power & Light (FPL), owns 197,000 acres of land dedicated to solar power. That’s over 300 square miles covered with solar panels instead of pastures, orange groves and timber stands – and commensurate livestock and wildlife. It plans on adding another 66 square miles of solar panels in the next three years. Duke Energy and the other companies selling electricity in Florida will more than double the solar numbers of FPL. Currently power companies can get both an investment tax credit and a production tax credit from the feds for solar and wind electrical generation.
Equatic is a company that has engineered an enhancement of the oceans capturing CO2. It uses electrolysis to turn the gas into a solid slurry and apparently 99.000 times faster than the ocean natural process.
CA requires solar and wind electrical energy and mandates EVs, all in the supposed interest of net zero carbon emissions. But failing to prevent or control wildfires has burned tens of thousands of acres and destroyed thousands of homes. In turn, millions of tons of CO2 were emitted (and choking smoke) not only in its own air, but across the country as the wind carries same. With all the climate change falderal, one must move out of CA to breathe.
The 7-day celebration of the Chinese New Year starts Wednesday (1/29). It’s the year of the snake on the Chinese lunisolar calendar.
