The Full CtC

[LPC]

Okay, now that we can all read the full "fascinating truth about taxation in America," is there anything new that needs to be debunked?

As far as I can tell, the answer is no. Skimming through, I was actually bored and disappointed to find that there's not much in there that couldn't have been cut and pasted from any one of a number of websites. It's just the usual collection of misleading quotations taken out of context.

It's really just the same old crap, wrapped in a new package of bombast.

An interesting bit of pathological self-delusion appears on pages 91-93, in which he tries to explain how it is that anyone could disagree with him. (I'm limiting the quotations because the jerk has blocked all printing and copying and so I have to type anything I want to quote.)

In light of the Supreme Court's clear and repeated expressions regarding the untaxable nature of private activities, the virtually moot effect of the the 16th Amendment, and the restricted meaning of the term "income"--along with the sufficiently clear written letter of the law--there are only a couple of possible truths to compete with that presented here.

[snip first rationalization]

Another possibility is that I am just "cherry-picking", culling out only such rulings, statutes and other evidence from the whole body available as support my contentions. Well, even if this were true, the very existence of such evidence to be "cherry-picked" would render any to the contrary that might exist to be at least ambiguous, if not outright overborne, and thus, in either case, void.

That's right, Pete does not deny that he has ignored the dozens of Supreme Court decisions (or the hundreds, if not thousands, of Circuit Court decisions) that contradict what he says, but the very fact that he can find some words in a few statutes and court decisions that he can take out of context and mislead a handful of rubes means that the entire tax system must be void for ambiguity.

He then goes on to assert that, because he has been able to ignore everything that contradicts him, it is somehow unfair to suggest that it exists:

At bottom, that protest, which presumes that there is somewhere a contradictory body of evidence in support of the current regime, is a hollow attempt to reverse the burden of proof, compelling the questions of why is MY body of eivdence extant, and where is the other?

Concluding that:

What is left is that what I say about the law is true, and the apparent contradiction with the way things are is the consequence of a conspiracy in defiance of the truth.

At least he admits that there is a contradiction between reality and what he claims is "truth."

Now if he could just understand that the "contradiction" is itself the "contrary body of evidence" he claims does not exist.

[Harvester]

Hey thanks for the link to the full 270-page CRACKING THE CODE book, Dan. More than any other, this is the book that released me from tax slavery. Here I learned the origin of the tax as a duty on federal pay over $600 per annum, as well as an excise on "gains, profits, and income" derived from the pay of private-sector and govt workers alike. I learned of the custom terms and how the statutes cannot possibly mean what the IRS would have us all believe.

Applying Pete's knowledge along with Mr. Merrill's lawful money theory (they are not in conflict) of not endorsing private credit of the Federal Reserve, has totally freed me from tax slavery (with no IRS issues I might add).

No excuse now - download it on the sly, tell everyone you'd never deign to read it. Just don't say you weren't warned away from the world's biggest scam. And, that you continued to be conned by it! The biggest contradiction here is you & the other Quatlosers Dan.

Y'all enjoy yer New Year paying taxes ya don't owe now, ya hear.

[Famspear]

Here is a post at Bob Hurt's web site, allegedly written by Lowell (“Larry”) Becraft:

From: Becraft
Sent: Friday, December 31, 2010 6:14 PM
Subject: Re: Peter Hendrickson releases Cracking the Code: Larry
On 12/31/2010 4:48 PM, Larry Becraft wrote:

Here is my argument regarding Pete's tax position and that asserted in his book.

The 1913 income tax act was allegedly broad, but that breadth was substantially reduced after Congress modified the income tax laws in response to the Brushaber decision. The income tax laws were written to be constitutional, but the "word-smithing" used in drafting those acts made the law appear broader than it really was. And this was intentional.

In order the determine how the income tax laws operate and apply, it is my opinion that study of all the old tax acts and regs is essential. By starting at the very beginning and following the law's development, you can see how the tax operates. From this historical perspective, the tax is far different from the common perception.

Pete focused on withholding for the "meat" of his argument, but because Pete used for the most part "modern" income tax law, he drew incorrect conclusions. If you follow the development of withholding from the outset, you can see that in 1913, withholding allegedly applied to all "persons." But in 1916 and 1917, the withholding scheme changed so that withholding applied only to non-resident aliens ("NRAs"). This was the condition of withholding all the way up thru the 1939 Code. In this scheme, federal employees were excluded, except for fed employees working abroad in some contexts.

The current withholding scheme we have today is based on 2 acts adopted during WWII. First, the Victory Tax Act of 1942 imposed a tax and collection scheme, but this act was in effect for less than a year when it was replaced by the Current Tax Payment act, which was eventually codified into the 1954 Code. Unless you are familiar with the history of these laws, you will completely miss how they operate. Pete did not know this history and drew incorrect conclusions. He simply made arguments "willy-nilly" based on a construction of various assorted provisions of the current Code. Personally, I disagree with the conclusions Pete reached. To assert that withholding applies only to fed employees, and the tax to be similarly applicable, is wrong. If anything, the tax is imposed on the taxable income of NRAs and foreign corporations.

Larry

http://groups.google.com/group/lawmen/b ... a3f3?hl=en

[LPC]

The 1913 income tax act was allegedly broad, but that breadth was substantially reduced after Congress modified the income tax laws in response to the Brushaber decision.

Nonsense. To quote the Supreme Court:

"Congress applied no limitations as to the source of taxable receipts, nor restrictive labels as to their nature. And the Court has given a liberal construction to this broad phraseology in recognition of the intention of Congress to tax all gains except those specifically exempted." Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-430 (1955).

In order the determine how the income tax laws operate and apply, it is my opinion that study of all the old tax acts and regs is essential.

Yes, in order to make my services as a defense lawyer essential, you need to work to dig the hole deeper and wider.

Personally, I disagree with the conclusions Pete reached. To assert that withholding applies only to fed employees, and the tax to be similarly applicable, is wrong. If anything, the tax is imposed on the taxable income of NRAs and foreign corporations.

Yes, we disagree about the reasons for our conclusions, but the conclusions themselves are indisputable.

[notorial dissent]

I very strongly doubt that Becraft had anything to do with that, I don’t remember him ever making any of those arguments, even for Becraft those are lame even for him.

The basis of this so called argument is that because the law was “allegedly” written one way at one time, which I don’t believe is correct, means that it can’t be changed over time. The equivalent of saying that just because Black’s defined something one way a hundred years ago means that the meaning of words cannot change over time. So very wrong!!!!!

The only true or verifiable bit in this is that Becraft has previously opined that Pete was an ass and totally wrong.

[silversopp]

I learned of the custom terms and how the statutes cannot possibly mean what the IRS would have us all believe.

Aren't you a little bit concerned that Pete was convicted and tossed into prison for following CtC?
Aren't you a little bit concerned that many of Pete's followers also got convicted for violating the tax code?

Applying Pete's knowledge along with Mr. Merrill's lawful money theory

Aren't you the tiniest bit concerned that you're following legal theories of a man who
1) is mentally unfit to hold trial
2) is homeless
3) believes he caused 9/11
4) files ridiculous lawsuits (seriously Harvey, have you read the lawsuit where his motor scooter sued Jesus Christ? http://www.trial.com/Blogger/2001_08_01 ... rchive.htm)

Your heroes have never won a lawsuit and live the worst lives possible here in the US.

[Famspear]

....Aren't you [i.e., Harvester aka Nationwide aka Libre aka johnthetaxist aka John Travis Harvester] a little bit concerned that many of Pete's followers also got convicted for violating the tax code?

Yes, to recap: There's Eugene George Warner (inmate # 13345-006), now serving time in federal prison. Warner pleaded guilty to one count in exchange for the dropping of several other charges, but I don't remember whether that one count was "tax code" or not. Blowhard Hendrickson posted information from Warner on the Blowhard's web site, presenting Warner as a victor in the Cracking the Code scheme. Then there is Roger Charles Menner (inmate # 34851-083), a repeat offender currently in federal prison on federal tax convictions. Menner posted on Hendrickson's web site but, after Menner got in trouble, Hendrickson claimed that Menner did not follow Hendrickson's scheme properly. Then there is a report that Michael I. O'Daniel used the scam. O'Daniel is awaiting sentencing scheduled for March. Hendrickson follower Tim Whitney ("databrain") claims that O'Daniel used Hendrickson's scheme.

[Cpt Banjo]

No excuse now - download it on the sly, tell everyone you'd never deign to read it. Just don't say you weren't warned away from the world's biggest scam.

The only scam is CtC itself. I noticed on page 12 that Hendrickson repeats the classic tax denier goof by attributing the wages-aren't-income-only-what's-derived-from-wages-is- income quote to a lower court decision in Lucas v. Earl (in various errata lists on the LH website, he identifies it as from the 9th Circuit's opinion). Unfortunately, he's either too dumb or too much of a liar (take your pick) to know that the quote is from Mr. Earl's brief, not from the 9th Circuit.

[notorial dissent]

But it said what Pete wanted it to say, therefore it must be right and the correct court decision, and little things like facts and correctly quoting something just get in the way of Pete's delusions.

[Quixote]

I find it interesting that Hendrickson confesses on page viii that he started with an unsupported position, "I knew perfectly well that [salaries, wages and similar compensations], insofar as they have to do with me, cannot be 'taxable' income, at least not unless I, by endorsing such a characterization (or letting it stand unchallenged) made them so" and then searched for a rationale to support it.

Also interesting is Hendrickson's advice on page xi to read the book without significant interruption. As I understand it, that procedure will minimize the reader's understanding what he has read. Reading new material in increments allows the subconscious mind to process it. And, of course, if one reads CTC rapidly, one is less likely to look up the citations and notice that PH's quotations and paraphrases are taken out of context, when they are not fabricated outright.

[Joey Smith]

Wasn't Harv the one who was predicting back in October that the entire Federal Reserve system would collapse by November 15?

[Pottapaug1938]

Wasn't Harv the one who was predicting back in October that the entire Federal Reserve system would collapse by November 15?

If Harv told me that it was going to be sunny tomorrow, I'd grab my coat before leaving my house in the morning.

[LPC]

Another interesting fraud by Hendrickson:

As for the several states of the Union, on the other hand,

"It is unnecessary to lay special stress on the title to the soil in which the channels were dug [Boston, Massachusetts], but it may be noticed that it was not in the United States." United States Supreme Court, Ellis v. United States, 20t U.S. 246; 27 S.Ct. 600 (1907).

Hendrickson uses this quote to convince idiots like Harvester that the Supreme Court was saying that Boston is not in the United States, but that's not what the court was saying at all. The court was talking about who owned the soil. This is clear from the very next two sentences:

The language of the acts is 'public works of the United States.' As the works are things upon which the labor is expended, the most natural meaning of 'of the United States' is 'belonging to the United States.'

(The opinion involved a federal statute that made it a crime for "any contractor or subcontractor whose duty it shall be to employ, direct, or control any laborer or mechanic employed upon any of the public works of the United States or of the District of Columbia" to "require or permit any such laborer or mechanic to work more than eight hours in any calendar day...." The Supreme Court affirmed the conviction of a contractor who permitted laborers working to repair piers in the Boston navy yard, but reversed the convictions of seamen working to dredge channels in the harbor.)

[Gregg]

Wasn't Harv the one who was predicting back in October that the entire Federal Reserve system would collapse by November 15?

If Harv told me that it was going to be sunny tomorrow, I'd grab my coat before leaving my house in the morning.

If he told me it was gonna be daylight in the morning I'd take a flashlight.

[Imalawman]

From: Becraft - The current withholding scheme we have today is based on 2 acts adopted during WWII. First, the Victory Tax Act of 1942 imposed a tax and collection scheme, but this act was in effect for less than a year when it was replaced by the Current Tax Payment act, which was eventually codified into the 1954 Code.

This is fairly accurate. What really changed was the structure of the tax code to reach more than the top 5-10% of wage earners. When this happened, they knew that they could not count on the vast majority of Americans to save enough for year-end taxes and secondly, they knew that they could increase liquidity in a time of war if they could regularly collect taxes throughout the year. These factors paved the way for withholding. After the war, they realized what a good thing they had good and continued it until the present day.

[LPC]

From: Becraft - The current withholding scheme we have today is based on 2 acts adopted during WWII. First, the Victory Tax Act of 1942 imposed a tax and collection scheme, but this act was in effect for less than a year when it was replaced by the Current Tax Payment act, which was eventually codified into the 1954 Code.

This is fairly accurate. What really changed was the structure of the tax code to reach more than the top 5-10% of wage earners. When this happened, they knew that they could not count on the vast majority of Americans to save enough for year-end taxes and secondly, they knew that they could increase liquidity in a time of war if they could regularly collect taxes throughout the year. These factors paved the way for withholding. After the war, they realized what a good thing they had good and continued it until the present day.

The original revenue act of 1913 included provisions for withholding the tax at the source, but those provisions were repealed in 1917.

A factor that may have made it easier to re-introduce withholding in the 1940s was the Social Security Act that was enacted in the 1930s, because that act required withholding of tax from wages. By the 1940s, both employers and employees would have become used to withholding taxes from wages, so the additional withholding might not have generated as much opposition as it had in 1913.

[Imalawman]

From: Becraft - The current withholding scheme we have today is based on 2 acts adopted during WWII. First, the Victory Tax Act of 1942 imposed a tax and collection scheme, but this act was in effect for less than a year when it was replaced by the Current Tax Payment act, which was eventually codified into the 1954 Code.

This is fairly accurate. What really changed was the structure of the tax code to reach more than the top 5-10% of wage earners. When this happened, they knew that they could not count on the vast majority of Americans to save enough for year-end taxes and secondly, they knew that they could increase liquidity in a time of war if they could regularly collect taxes throughout the year. These factors paved the way for withholding. After the war, they realized what a good thing they had good and continued it until the present day.

The original revenue act of 1913 included provisions for withholding the tax at the source, but those provisions were repealed in 1917.

A factor that may have made it easier to re-introduce withholding in the 1940s was the Social Security Act that was enacted in the 1930s, because that act required withholding of tax from wages. By the 1940s, both employers and employees would have become used to withholding taxes from wages, so the additional withholding might not have generated as much opposition as it had in 1913.

In tax policy class I took during my LLm we focused a class period and week's reading on this issue. You are right, that helped. However, the propaganda that went out to support the victory tax also helped. It was during a time where withholding taxes was seen a patriotic. There's a couple funny little Donald Duck cartoons about paying taxes that came out during this time. I think that had the tax been expanded and withholding imposed outside of the war effort, than it would have been tremendously opposed. Once it was in, it become normal and was easy to keep - especially with SS already in place.

Its actually an interesting topic because really the personal income tax as we know today really didn't get going until the early 40's.

[wserra]

In tax policy class I took during my LLm we focused a class period and week's reading on this issue . . . There's a couple funny little Donald Duck cartoons about paying taxes that came out during this time.

Hmm. Perhaps an LLM is overrated.

[Quixote]

There's a couple funny little Donald Duck cartoons about paying taxes that came out during this time.

I have been led to believe that the cartoons urged taxpayers to pay their Victory Tax currently, i.e., with their 1943 return, rather than deferring it until they filed their 1944 return in 1945, as they had the option to do. Was I misled?

[webhick]

In tax policy class I took during my LLm we focused a class period and week's reading on this issue . . . There's a couple funny little Donald Duck cartoons about paying taxes that came out during this time.

Hmm. Perhaps an LLM is overrated.

Meanwhile, you conveniently forget that in the process of being pumped full of lawyery goodness, you took a semester-long class on graphic novels.