We The People Foundation For
Constitutional Education, Inc.
2458 Ridge Road, Queensbury, NY 12804
Phone: (518) 656-3578 Fax: (518) 656-9724

February 11, 2005

VIA PRIORITY MAIL

Hon. Connie Mack III, Chairman
The President’s Advisory Panel on Federal Tax Reform
C/o Shaw Pittman LLP
2300 N. Street NW
Washington, D. C. 20037-1128

Dear Chairman Mack:

This letter has been sent to each member of the Panel and comes from more than 15,000 citizens representing all fifty states.

Meaningful federal tax reform must begin with the Panel’s answer to the forty-three (43) questions that were respectfully submitted to President Bush and Treasury Secretary Snow in May of 2004. Copies of the May 10, 2004 letters to President Bush and Secretary Snow are enclosed with this letter. Please note that thirty-eight (38) of the questions are to be found at the end of Attachment #1 to the letter to Secretary Snow, and five (5) of the questions are located at the end of Attachment #2.

The questions focus on the obvious conflict between two interpretations of the meaning of the word “income” within 16th Amendment to the Constitution: the never-overturned interpretation provided by the U.S Supreme Court versus the interpretation asserted in self-interest by the political branches.

As the Attachments conclusively document, in 1913, just months after the adoption of the 16th Amendment, Congress stretched the meaning of the term “income” beyond the constitutional meaning and the intent of the framers of the 16th Amendment, as recorded in every official and professional document of the era: the congressional record, congressional reports, law reviews, journals of political science, newspapers of record and so forth.
 
In the Income Tax Act of 1913, Congress, included a non-apportioned, direct tax on the salaries, wages and compensation of ordinary Americans and instituted withholding at the source, providing the federal government’s creditors with the ultimate form of lender security – the labor of its citizens.
 
However, in 1916, the Supreme Court brought the ultra vires action of Congress and the Executive branch to a screeching halt. The Supreme Court ruled in Brushaber v. Union Pacific, 240 U.S.1 (and the cases bundled with it), that wages are NOT income within the meaning of the 16th Amendment.

The Supreme Court's decision in Brushaber soundly rejected the government’s interpretation of the definition of “income” within the meaning of the Constitution, and specifically limited “to whom” and “where” the income tax could apply. The Brushaber court explicitly concluded that the 16th Amendment gave Congress no new powers of taxation, meaning that direct taxes (such as Social Security taxes and Subtitle A income taxes) fell outside of the meaning of the 16th Amendment and still must satisfy the fundamental requirement of apportionment.
 
However, Congress was loathe to give up the potential bounty from an un-apportioned, direct tax on the labor of every American, and the power and control that tax and its enforcement mechanisms brought.

The Brushaber decision prompted Congress to discretely and quietly revise the 1913 Act, and via Section 25 of the Federal Income Tax Act of 1916 (amended in 1917), Congress declared that the "income" subject to the 1913 Act was not the same “income” to be taxed under the 1916 Act. However, Congress did not go any further. What was the purpose of this change in the language, and by extension, its legal effect? Congress did not, and has yet to explain what was meant by Section 25.

Since then, Congress has looked the other way as the Executive, with the cooperation of the lesser courts, has imposed and enforced a direct tax on the salaries, wages and compensation of ordinary Americans and instituted withholding at the source.

The People have repeatedly Petitioned the government to remedy the oppression, but their repeated Petitions have been met by repeated injury.

As the final interpreter of the Constitution, we, the People believe the Supreme Court got it right – a tax on labor is a “slave tax,” and is a violation of fundamental, human Rights. In short, it is unconstitutional and intolerable.

By this open letter, we humbly Petition the Panel for Redress of this Grievance. We will send a representative to Washington DC for your answer to the question, “Will the Panel provide an answer to the forty-three questions?” A simple “Yes” or “No” is all that we ask, written on the Panel’s stationery and signed by the Chairman of the Panel.

Our representative will attend the first meeting of the Panel, scheduled for February 16, 2005, at the Ronald Reagan Building & International Trade Center, 1300 Pennsylvania Avenue NW, Washington, DC. He will arrive before 10 am, outside the main entrance to the building, where he will remain until one half hour past the adjournment of the meeting. For purposes of identification, our representative will be holding a placard with the words, “No Answers, No Taxes,” written on one side and the words, “Obey the Constitution,” written on the other side.

We urge you to carefully review and consider the implications of the research attached to this letter.
Due to the efforts of organizations such as ours, millions of Americans know the truth about the income tax fraud. Millions have stopped filing and paying the tax because the government has not listened or responded to their Petitions for Redress. We respectfully ask that in your work for this panel, you rise above the politics of fear associated with addressing this problem and end the fraud. The future of the Republic and our Freedom depend on your personal commitment to uphold and defend the Constitution.

Respectfully submitted,

______________________
Robert L. Schulz, Chairman

Encl.

Hon. Connie Mack III, Chairman
The President’s Advisory Panel on Federal Tax Reform
C/o Shaw Pittman LLP
2300 N. Street NW
Washington, D. C. 20037-1128

Hon. John Breaux, Vice-Chairman
The President’s Advisory Panel on Federal Tax Reform
1440 New York Avenue NW
Suite 2100
Washington, DC 20220

William Eldridge Frenzel, Member
The President’s Advisory Panel on Federal Tax Reform
C/o Brookings Institution
1775 Massachusetts Avenue NW
Washington, D.C. 20036

Professor Elizabeth Garrett, Member
The President’s Advisory Panel on Federal Tax Reform
C/o The Law School
University of Southern California
Los Angeles, CA 90089-0017

Professor Edward P. Lazear, Member
The President’s Advisory Panel on Federal Tax Reform
C/o Stanford University
Hoover Institution
Stanford, CA. 94305

Professor Timothy J. Muris, Member
The President’s Advisory Panel on Federal Tax Reform
C/o George Mason School of Law
3301 Fairfax Drive
Arlington, VA 22201

Dr. James Michael Poterba, Member
The President’s Advisory Panel on Federal Tax Reform
C/o Department of Economics
Massachusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139-4307

Mr. Charles O. Rossotti, Member
The President’s Advisory Panel on Federal Tax Reform
C/o The Carlyle Group
1001 Pennsylvania Avenue NW
Washington, D C 20004-2505

Mr. Jeffrey F. Kupfer, Executive Director
The President’s Advisory Panel on Federal Tax Reform
1440 New York Avenue NW
Suite 2100
Washington, DC 20220

Ms. Liz Ann Sonders, Member
The President’s Advisory Panel on Federal Tax Reform
C/o Charles Schwab
101 Montgomery Street
San Francisco, CA 94104