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Fourscore and Seven (Thousand New IRS Agents)

by Edward Posted: Tuesday, 11/22/2022

21 Nov 2022

Congress passed on 12 Aug 2022 and President Biden signed into law on 16 Aug 2022 the “Inflation Reduction Act”.  Part of this law provides $80,000,000,000 to the IRS to fund modernization and increased tax enforcement. Those who voted for this bill did so (if they read it) expect to obtain additional revenues as follows [1]: a) $181,000,000,000 from improved tax enforcement; b) $74,000,000,000 from a 1% excise tax on stock buybacks; c) $222,000,000,000 from a 15% corporate minimum rate on companies with $1,000,000,000,000 in revenue; and d) $53,000,000,000,000 from an extension of the limitation on excess business losses.  These values total to $530,000,000,000 over ten years.  If so, these projections admit that it will cost 15 cents to obtain each additional dollar, which is a very high 15% collection expense ratio.  For comparison, the IRS’ current annual expenditure for FY 2021 [2] was $13,700,000,000, and its collections in FY 2021 were [3] $4,900,000,000,000, which represents a collection expense ratio of 0.27%.  That difference alone should convince you that this is not about additional revenue.

Part of the $80,000,000,000 is to be devoted to hiring 87,000 new IRS employees, but the type of employees was left to IRS discretion.  According to the IRS [4], it has already hired 4,000 new customer service employees to help answer the phone and assist taxpayers with questions, and it plans to hire another 1,000 before 1 Jan 2023.  According to another IRS statement [5], the IRS is developing a plan on how to spend the remainder of the $80,000,000,000.  Commissioner Rettig also sent a letter to members of the Senate [6], stating in part:

“These resources are absolutely not about increasing audit scrutiny on small businesses or middle-income Americans. As we’ve been planning, our investment of these enforcement resources is designed around the Department of the Treasury’s directive that audit rates will not rise relative to recent years for households making under $400,000. Other resources will be invested in employees and IT systems that will allow us to better serve all taxpayers, including small businesses and middle-income taxpayers. Enhanced IT systems and taxpayer service will actually mean that honest taxpayers will be better able to comply with the tax laws, resulting in a lower likelihood of being audited and a reduced burden on them.”

Notice that the Commissioner cited Treasury Secretary Janet Yellen’s directive to maintain the audit rate on persons making less than $400,000 annually to the historical norm.  Notice that Secretary Yellen did not instruct Mr. Rettig to ensure that the audits are non-partisan; she only instructed him to ensure the overall rate is within historical norms. We can have high confidence that, since Lois Lerner is the patron saint of the IRS, the audit rate for non-Democrats is going to be increased dramatically.  It is worse than that: Secretary Yellen does not require Commissioner Rettig to prove that the overall audit rates are within historical norms; it is merely a directive.  This legislation gives the IRS a lot more power; but power does not confer confidence in the institution, which is the IRS’ real problem. 

How can a corrupt politically-motivated government agency be reformed?  There are three things that seem like good ideas, but are impractical.  First, the IRS cannot be abolished so long as the government requires revenue, and every government requires revenue to carry out its legitimate functions.  Second, individuals will be subject to audits so long as our tax code is based on the income tax (personal and businesses).  No one in Congress is going to vote to repeal the individual income tax, so audits of individuals will continue indefinitely.  Third, the IRS is not going to give up any of its powers; in fact it will likely petition Congress for an expansion of its powers.  Any plan to promote the public’s confidence in the IRS must operate under these constraints.  The best that can be hoped for is to ensure that those who are examining our returns for compliance and auditing regular taxpayers are themselves paying their taxes.  In other words, it is necessary that all IRS employees be audited for tax law compliance.  It will not guarantee that IRS audits of regular taxpayers are non-partisan, but at least we can have confidence that the partisans in the IRS are subject to the same scrutiny. 

However, audits of IRS employees must be conducted a little differently than IRS audits of regular taxpayers.  We cannot have a situation in which one IRS employee “audits” another IRS employee, as the opportunity for evasion and cheating is too great (remember the core problem here). The audits are not intended to be punitive; they are designed solely to ensure public confidence that those who enforce the law are equally subject to it.  An IRS audit system should be set up along these guidelines.

1.  Every IRS employee (save for a few, such as the janitorial staff, who have no contact with taxpayers or with tax forms), shall be audited every three years, and said audits shall cover the past three tax years.  About 57,000 audits will be required each year, since the number of IRS employees will be about 185,000 after all the new hires are brought on.

2.  The auditors shall not be current or former IRS employees, and shall have no first-degree relatives (siblings, aunts, uncles, cousins, or children) who are currently employed by the IRS.

3.  Any IRS employee subject to such audits found to be in arrears on tax payments (excluding extensions and other allowances per the current law, same as other taxpayers) shall be permitted an appeal. Said appeal shall be finalized within 30 days of the initial audit findings.  If the appeal shows that the IRS employee is in fact delinquent on their taxes, they shall be dismissed with prejudice (ineligible for future employment) within 24 hours.  There shall be no managerial discretion permitted regarding dismissal.  Payments on delinquent taxes shall follow the current guidelines per the existing law, same as all other taxpayers.

4. The statistics of the audit shall be published annually, noting how many audits were conducted, how many were found in compliance, how many were not, and the locations in which those dismissed resided (by State and county only). 

References

[1] Analyses as cited in: httpss://en.wikipedia.org/wiki/Inflation_Reduction_Act_of_2022

[2]  httpss://www.irs.gov/statistics/irs-budget-and-workforce

[3]  FY 2022 IRS Agency Financial Report, (Form 5456), available at: httpss://www.irs.gov/pub/irs-pdf/p5456.pdf

[4]  httpss://www.irs.gov/newsroom/irs-quickly-moves-forward-with-taxpayer-service-improvements-4000-hired-to-provide-more-help-to-people-during-2023-tax-season-on-phones

[5]  httpss://www.taxpayeradvocate.irs.gov/news/tas-tax-tip-what-the-inflation-reduction-act-means-for-you/

[6] Commissioner Rettig to Members of the United States Senate, 4 Aug 2022; available at:

httpss://www.irs.gov/pub/irs-utl/commissioners-letter-to-the-senate.pdf

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The Open Border Policy Rationale

by Edward Posted: Monday, 7/25/2022

There was a recent convocation of the ruling elite in Aspen, CO.  During the presentations, Trymaine Lee, a correspondent from MSNBC, interviewed the U. S. Secretary of Homeland Security Alejandro Majorkas on 21 Jul 2022, and part of it went like this:

Trymaine Lee: “Is the border safe now? I was watching a news channel and they were talking about an invasion that was happening.” 

(Audience laughs)

Alejandro Majorkas: “The border is secure; the border we are working to make more secure.  That has been a historic challenge.”

Majorkas’ claim may seem quite a surprise, first, since about 3 million illegal aliens (that we know of) have already crossed into the U. S. in the past year.  All these people are being let in; we don’t know who they are, where they are, or what they intend to do (besides getting free benefits paid for by U. S. taxpayers).  The second major point is that illegal alien immigration was much less under the Trump administration.  The U. S. is in fact being invaded, and (finally) a few State Governors have found the backbone to state the obvious. 

When Majorkas said “the border is secure”, what he really meant was “the border policy is secure”.  The Biden administration has at various times issued several lies to justify the open border.  The first one was that the people of Central America must be allowed to come here because we (Americans) have induced so much climate change that we are driving them out of their traditional occupations.  The second lie was that the white people of America are so racist that we owe the indigenous people of Central America an equal opportunity to come here as historical compensation.  The third lie was that opening the border will facilitate trade, and thus promote prosperity for all, i.e., the globalist argument.  The fourth lie was that unlimited immigration is good because immigrants create jobs, or take jobs that Americans won’t do, or immigrants have special skills that Americans don’t have; in other words, foreigners are simply better people than Americans.  The good news is that Vice President Kamala “Smirky” Harris (the “border czar”) has promised to find the “root cause”.

But the real question remains: if illegal immigration was almost zero during the last part of the Trump administration, what is the purpose of the completely open-border policy under the Biden administration?  Some conservative commentators have noted that we are generally importing poverty, social dependence, and ignorance; and that large immigration means that the American taxpayer gets to pay for other nations’ socialist incompetence.  Some have observed that many of the illegal aliens come here with no intention of assimilating into American culture, and the result of unrestricted immigration is that Americans end up tolerating any movement that dilutes western civilization.  Some have also claimed that this is a ploy to import as many ignorant people as possible because the Democratic party leadership, relying on historical trends, are confident that the invaders will all vote for Democrats as soon as they get voting rights, with citizenship or without. In other words, the former illegal immigrants will partly cancel out the votes of those who still believe in the Constitution and the legitimate control of borders.   Those are probably all correct to some extent.  I will now suggest a reason that I have not heard mentioned elsewhere.

All this talk about China taking over Taiwan is a diversion: the real goal is the strategic encirclement of the U. S.  Taiwan can be blockaded at any time; that requires only a sufficient Chinese navy and a convenient pretext. Pretexts are easy for Communists, and they and build the navy.  Taiwan is small potatoes: China could gain world domination if it could acquire control of Central America. It seems to me that President Joe “Wimpy” Biden, either a wholly-owned subsidiary of the Chinese Communist Party or under blackmail pressure, has been ordered to de-populate El Salvador, Guatemala, Honduras, Nicaragua, Panama, and Ecuador.  (I exclude Costa Rica because it is relatively prosperous and has abolished its military.)  It will be much easier for China to establish colonies in empty places than to deal with people who may prefer their traditional nations.  Keep in mind that China is a long way from the western hemisphere, and it probably can only transport an army of 100,000 or 200,000 troops in a reasonable amount of time.  It will not be practical to transport the heavy weapons necessary for a real battle. A small, lightly-armed land force could conquer Central America quickly if: a) it is mostly empty; b) the remaining people are unarmed; and c) the local governments and military establishments are corrupt. The last two were accomplished decades ago. 

Consider the basic arithmetic as shown in the table.  The totals lead to an average population density of about 275 people per square mile (about the same as our major cities, such as Philadelphia, New York, Boston, etc.).  If 4 million per year are resettled in the U. S. over the next seven years, the total population will be reduced by 28 million, and the net remaining will be 18 million or so. The average population density would then be about 105 per sq. mile (roughly the same as Iowa, Kentucky, and eastern Oklahoma).  Since most would remain in the cities, the population density in the rural areas would be significantly lower.  The Chinese could export 10,000,000 people to Central America reasonably quickly if camouflaged carefully enough, and thereby establish solid, durable colonies.

Nation Population Area (sq. miles)
Guatemala 18,576,000 42,042
El Salvador 6,550,000 8,260
Honduras 10,225,000 43,277
Nicaragua 6,784,000 45,678
Panama 4,453,000 29,761
Total 46,588,000 169,018

Chinese control of Central America would give it enormous advantages. First, it could establish military bases in these (former) nations (plus Cuba), and form an alliance with Mexico, America’s traditional enemy.  (Recall that Mexico sided with Germany in both World Wars.)  Secondly, it would have full control of the Panama Canal: not just the operation of the canal itself, but all the approaches to it.  Third, the Caribbean Sea and the Gulf of Mexico would come under full Chinese surveillance and intimidation.  Fourth, China would gain indirect control over the U. S. ports at Corpus Christie, Galveston, Houston, New Orleans, Mobile, Pensacola, Tampa, and Miami.  Fifth, China would have direct leverage over all the Caribbean island nations, including islands populated by British nationals. Britain has foreign policy control and defense obligations on its’ Caribbean dependencies: Anguilla, Bermuda, the British Virgin Islands, the Cayman Islands, Montserrat, and Turks and Caicos.  If the U. S. was unwilling to assist Britain in defending these islands (or sides with China as the ruling elite prefers), a breach would occur between the U. S. and our greatest ally.

Majorkas was right if you accept the fact that he is always lying.  The open border is not causing an “invasion”; it is facilitating an “evacuation” for the benefit of Communist China.

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Privacy in the Modern Age, Part 1

by Edward Posted: Saturday, 2/6/2021

PrivacyInTheModernAge_1   <– PDF

Introduction

The Fourth Amendment to the U. S. Constitution reads:

“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

This particular Amendment was to ensure that one abuse, among others, that had been inflicted the colonists by the British government could not be repeated under the Constitution: the infamous ‘writ of assistance’.  The historian John Fiske [1] gives a summary:

“In 1761, it was decided to enforce the Navigation Act, and one of the revenue officers at Boston applied to the superior court for a “writ of assistance”, or general search warrant, to enable him to enter private houses and search for smuggled goods, but without specifying either houses or goods.  Such general warrants had been allowed by a statute of the bad reign of Charles II, and a statute of William III, in general terms, had been granted to revenue officers in America like powers to those they possessed in England.  But James Otis showed that the issue of such writs was contrary to the whole spirit of the British constitution.  To issue such universal warrants allowing the menials of the custom-house, on mere suspicion, and perhaps from motives of personal enmity, to invade the home of any citizen, without being held responsible for any rudeness they might commit there, – such he said, was ‘a kind of power, the exercise of which cost one king of England his head and another his throne;’ and he plainly declared that even an act of Parliament which should sanction so gross an infringement of the immemorial rights of Englishmen would be treated as null and void.”

James Otis was a Boston lawyer, and one of the principal proponents of independence in the 1760’s.  He was in declining mental health and suffered permanent injury in 1769 after being severely beaten by a British customs officer.  However, he was able to sneak out of his house and fought against the British in the Battle of Bunker Hill (17 Jun 1775), escaping afterwards back to his house.

The Fourth Amendment requires any agent of the government to apply for a warrant, to be sworn under oath before a judge, describing what is to be searched and what evidence they have already obtained that would justify such a search.  It has always been a feature of American justice, at least at the local level, with two exceptions: it never applied to slaves, and it did not apply to free black people in the South during the Jim Crow era (1890’s to about the 1940’s).  The Democratic Party was an advocate for slavery and later was responsible for Jim Crow.

But we now have three problems not contemplated by the authors of the Constitution.  First is the growth of electronic technology; secondly, the power of corporations that control the electronics technology; and third, the union of those corporations and the government.  At this point in our history, the average American, unless he practices good electronic security, has virtually no privacy at all.  The following essays will describe these risks, and what you, the average American, can do to protect your privacy in the digital environment that we now wallow in.

But before we get to details, let’s first establish how the Fourth Amendment should be interpreted, and by extension, how we should think of individual privacy.  To me it means different things in the three cases I’ve mentioned.  Toward the government alone (case 1) it means, “My affairs are none of your business unless you have prior evidence that justifies investigation.”  Toward corporations, and the cooperation between corporations and the government (cases 2 and 3) it means, “My affairs are none of your business.”

There is one cardinal rule that we should remember in regard to privacy in the electronic environment: if a violation of your privacy is possible, it is being done unless the government and corporations prove under oath that it is not.  Even then, take their claims with a grain of salt.

Reference

[1] John Fiske, John Fiske’s Historical Writings, NY: Houghton, Mifflin and Company, 1896, Vol. 10, p. 14.  It is the same as Fiske’s original The American Revolution, 1891, Vol. 1, p. 14.

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The Biden Administration

by Edward Posted: Wednesday, 1/13/2021

The Biden Administration   <– PDF

Let us first take stock of where we are politically in America.

  1. We have endured a biological attack by China for the past 11 months in the form of the Wuhan virus. Fortunately we had President Donald “America First” Trump in office who was able to organize the government bureaucrats and the smart people in the research community to develop a vaccine in record time, something that very few people thought was possible, given the standard interval is about five years. The media claimed he was a fool to even try it.
  2. All summer long, Black Lives Matter and ANTIFA led “mostly peaceful protests”, mostly involving burning down police stations, federal courthouses, and many businesses, while the local police stood by and the Democratic leadership endorsed, encouraged, and applauded these street armies. The local politicians only allowed the police to arrest a handful of them, and few were prosecuted. The media made the appropriate excuses for these Marxist mobs.
  3. The governments of many states, mostly led by Democrats, decided to use the Wuhan virus to shut down their local economies, ruining many businesses and putting many out of work. At first it was to “bend the curve” of infections, but it soon became a test of how much tyranny the public is willing to put up with. The real goal, as always, was to somehow make the federal administration look bad.  The media made the appropriate accusations against Mr. Trump.
  4. The Democrat Party abused the judicial system during the summer of 2020, using the Wuhan virus as an excuse to obtain decrees on voting procedures that superseded the powers of the State legislatures. This happens to be unconstitutional, since Article 2 of the Constitution clearly states that only a State legislature can enact electoral laws. The objective, as we saw in November 2020, was to deluge the electoral system with fraudulent mail-in ballots that could not be verified.  That is how the Democrats got Joe “Wimpy” Biden elected President.  The media defended the unconstitutional activities of the judicial activists who ignored the Constitution.
  5. A great many affidavits attesting to electoral fraud were received and Republicans brought them to both state and federal courts, but all of those challenges were rejected on procedural grounds. No evidence was ever examined by any of the courts (as far as I know). The Republican lawyers made a huge error in not demanding that all the evidence be preserved for future examination, including the ballots, signature cards, voter rolls, and time-tagged tallies in the voting machines.  It is tantamount to a baseball batter bragging that he will hit a grand slam on the first pitch, without bothering to check if there are any guys on base.  That error allowed the Democrats to destroy all the evidence; now it is impossible to prove the veracity of the affidavits; we will never know how much fraud there was.  We now have six or seven States that run Presidential elections the way local elections are run in Chicago and Philadelphia.  The media demonized anyone who believed that something was not right.
  6. A rally was held on 6 Jan 2021, in which Mr. Trump listed the various ways in which the election results were questionable, and then encouraged the attendees to peacefully protest in front of Congress. Congress was at that time certifying Mr. Biden’s election. But ANTIFA members and a handful of not-too-bright Trump supporters engaged in a BLM/ANTIFA-style mostly peaceful protest at the Capitol, involving breaking windows, smashing down doors, and occupying Congressional offices.  A total of five people died: a police officer from head injuries, a protester from gunshots, and three others of “medical complications”.  The electoral balloting had to be stopped, and the members of Congress had to be led to a safe place until the Capitol police could remove the retards.  Now here is an important insight: all summer long, the Democrats in Congress praised the actions of the “mostly peaceful protestors” around the country who invaded people’s places of business, robbed them, and burned them to the ground.  Millions of Americans were inconvenienced for months by the BLM/ANTIFA mostly peaceful protests.  But, when the same tactics were employed against their (Congress’) place of business, inconveniencing them for a few hours, it’s an “insurrection”.  Poor babies; but I doubt they will get much sympathy.  The media chanted “Trump led a coup, Trump supporters are guilty of sedition and insurrection”, right on cue.
  7. The tech giants Amazon (led by Jeff “I own that too” Bezos), Google (led by Sundar Pichai), Facebook (led by Mark “Junior High” Zuckerberg), Instagram (owned by Facebook), YouTube (owned by Google), and Twitter (led by Jack Dorsey) have banned most conservatives (defined as anyone who is not a card-carrying Democrat) from their platforms on the grounds that conservatives are a general menace to society. They even managed to put PARLER (a competitor to Twitter) out of business. The media approved of the suppression of free speech.
  8. Today the Democrats impeached Mr. Trump for “inciting a riot”, despite there not being a single sentence in his speech that called for one. Maybe he should have called for a mostly peaceful protest. The media will brag how they won the revolution.

So, to summarize, as is typical in revolutions:

  1. Pressure from below by the BLM and ANTIFA street armies.
  2. Pressure from above by the suppression of speech by the tech monopolies, doing indirectly what the government cannot do directly — on behalf of the Democrats.

That is where we are.  What happens when Mr. Joe “Wimpy” Biden takes office on 20 Jan 2021?  The Democrats will take the opportunity to suppress the Constitution specifically and the rule of law in general; take away as many civil rights as possible; promote the interests of their favorites; demonize and ridicule their enemies (real and imagined); and attempt to acquire absolute power over everyone’s life.   The Democratic Party consists of vengeful, implacable, vindictive, hateful, hypocritical, arrogant know-it-alls, just like the “cool kids” back in junior high school.  Watch out: people who have never graduated from junior high at an emotional level will now be running the country.  How do we know Mr. Biden is a wimp?  The same way as in junior high: the kid who always swaggered around, talking tough, but scared to death of being challenged to prove it.  Unfortunately, as in junior high, the big talk may be enough to ward off any common sense ideas.

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