Rational discussion regarding CTC starring Ducky

[jg]

On Mon Jun 02, 2008 3:29 pm

I am not a troll, it is not my intention to bait others into emotional responses by posting off topic controversial posts. I have better things to do with my time. Quite the contrary, I would like to engage in rational discourse that proves to be on topic and coherent. I thought that my initial response and ensuing discussion was salient, but maybe others don't agree.

I plan to draft responses to as many of your(collectively) posts as I reasonably can. Currently, I am preoccupied and don't have the time respond, be patient. This isn't indicative of me running away, just busy.

I came here for a rational discussion regarding CTC. I will play the devil's advocate, because I have read his book and find his argument compelling. I lurked around LH for a while and noticed that they generally try to quell dissent, which obviously never leads to an objective outlook, that is why I came here. There is no censorship and you guys hold the stance of opposition, fair enough, Right?

It is quite apparrent that many of you are well versed in law and specifically tax law and relevant court cases, I plan on learning a lot and hopefully engaging in some meaningful debate.

till later,

Duck-e

The other thread is too long, so shall we continue here?

[jg]

On Tue Jun 03, 2008 1:49 pm

Ducky wrote:
Imalawwman--You are jumping ahead a little bit. I was thinking it would be easier for everybody if we just follow the book chap by chap, for debunking purposes, for lurkers reading(probably some from LH), and for me. Sorry to not address your particular ?/concerns, but I will get to them when the time comes.

But see, its the point that you're going to hear on this site time after time because its the sine qua non of all Tax arguments. What does the IRC say about your main thesis? That is the salient point in this debate. In my opinion, we shouldn't start with jots and tittles until you first demonstrate that your main, underlying thesis has merit. Once that is established, then we can proceed with the details. I have no interest in going down the crazy TP theory road to absurdity. State your main thesis and let's go from there.

[Famspear]

Yeah, this is a good place to continue.

In the interest of full disclosure, I want to point out the following verbiage from Wikipedia that was quoted by Ducky in the prior thread. Ducky cited this material in his agreement with something I had written earlier in the thread:

By contrast, excises are taxes on events. A realization of income (such as a receipt of wages) is an event. A sale is an event. A transfer of title by gift is an event. A transfer of title because of death is an event. Income taxes, sales taxes, and transfer taxes are all examples of event taxes. When a person receives money as income, it is not the ownership or state of title of the money itself that is taxed, but rather the fact that an income event has occurred. If the recipient takes the money and puts it under his or her bed for ten years, the income tax is not re-imposed on that money every year the money is under the bed. Only one thing is taxed by the income tax: the income event.

For purposes of the U.S. Constitution, an excise is essentially any indirect tax, or event tax. An excise means any tax other than (1) a tax on property by reason of its ownership; or (2) a capitation, or head tax

I agree with Ducky's agreement with my own point, and I agree with Ducky's favorable citation to the Wikipedia text. It's a cogent, insightful text, in my opinion. The full disclosure: For better or worse, I am the author of all (or substantially all) of the quoted Wikipedia text.

[grixit]

Continuing is good. But let's not move away from Chapter 1 of CTC until Ducky says whether or not they have conceded that Hendrikson was wrong on anything.

[Ducky]

Continuing is good. But let's not move away from Chapter 1 of CTC until Ducky says whether or not they have conceded that Hendrikson was wrong on anything.

I will assume rather than “they have” you meant to write “she/he has”

As far as I could see the main point of contention regarding chap 1 was raised by LPC. He brought up the fact that the citation from the Murdock case wasn’t in context and therefore not relevant. He also raised the issue with the other qoutes being from a court other than the supreme court. To that I ask, are rulings from a lower court not valid when debating? I also noted that although PH apparently quoted the minority opinion, the majority opinion didn’t differ much in substance. As far as the contention raised over the Murdock case, I will concede that the text is out of context in the sense that the “freedoms” do not refer to the right to earn a living. Upon reading the Murdock v. Pennsylvania, I found however, that the context of the case was quite relevant to the discussion. The main point of the supreme courts decision is that it is unconstitutional for a tax to impinge on one’s basic rights, in this case, the rights garaunteed by the first ammendment

It could hardly be denied that a tax laid specifically on the exercise of those freedoms would be unconstitutional. Yet the license tax imposed by this ordinance is in substance just that.

I think this is consistent with the argument of CTC, which basically holds that the tax on income is constitutional, but a tax on all that comes in, which is generated or realized by a most basic right, the right to earn a living, would be unconstitutional. Thus the question is broached as to whether “income” and “all that comes in” are synonymous?

JG-- I feel this is the appropriate time to address something that you had written in the original thread:

Of course, income tax is optional in the sense that one is free to arange one's affairs so as to not have taxable income; much the same way that one is free to not purchase items subject to sales tax.

Ok, If income truly means all that comes in, or in otherwords, every cent that a person earns; How then would someone arrange his/her affairs so as to not have taxable income? The only example I could think of would be “living off the land”. Otherwise, to avoid taxable income, one would have to stop working, which would definitely impinge on one’s ability to sustain life, a basic right.

The example of the grocery store and non taxable food items was something that I came up with, this was not in CTC, this was just a way for me to think about direct and indirect taxes. But I have a question as to whether the existence of a non-taxable food item list has its basis in issues of constitutionality of taxation. I understand it is a subjective list, but imagine there is no list and that every single food item garners a sales tax, would this tax not impinge on , again, the basic right of life. As the only way I see of avoiding it would be to live off the land and grow your own food.

This seems to be a decent segue into the second chapter of CTC, “The Origin of the Income Tax”

This chapter starts by introducing the revenue act of 1862 and more specifically sections 86., 90., and 93., which I will reproduce as cited in CTC:

Sec. 86
And be it further enacted, that on and after the first day of August, eighteen hundred and sixty-two, there shall be levied, collected, and paid on all salaries of officers, or payments to persons in the civil, military, naval, or other employment or service of the United States, including senators and representatives and delegates in Congress, when exceeding the rate of six hundred dollars per annum, a duty of three per centum on the excess above the said six hundred dollars; and it shall be the duty of all paymasters, and all disbursing officers, under the government of the United States, or in the employ thereof, when making any payments to officers and persons as aforesaid, or upon settling and adjusting the accounts of such officers and persons, to deduct and withhold the aforesaid duty of three per centum, and shall, at the same time, make a certificate stating the name of the officer or person from whom such deduction was made, and the amount thereof, which shall be transmitted to the office of the Commissioner of Internal Revenue, and entered as part of the internal duties;…

Sec. 90
And be it further enacted, That there shall be levied, collected, and paid annually, upon the annual gains, profits, or income of every person residing in the United States, whether derived from any kind of property, rents, interest, dividends, salaries, or from any profession, trade, employment, or vocation carried on in the United States or elsewhere, or from any other source whatever, except as hereinafter mentioned, if such annual gains, profits, or income exceed the sum of six hundred dollars, and do not exceed the sum of ten thousand dollars, a duty of three per centum on the amount of such annual gains, profits, or income over and above the said sum of six hundred dollars; if said income exceeds the sum of ten thousand dollars, a duty of five per centum upon the amount thereof exceeding six hundred dollars;…

Sec. 93
And be it further enacted,…that any party, in his or her own behalf, …shall be permitted to declare, under oath or affirmation, the form and manner of which shall be prescribed by the Commissioner of Internal Revenue, that he or she was not possessed of an income of six hundred dollars, liable to be assessed according to the provisions of this act, or… has been assessed elsewhere…and shall thereupon be exempt from any income duty; or, if the list or return of any party shall have been increased…,…he or she may be permitted to declare,… the amount of his or her annual income,… liable to be assessed,… and the same so declared shall be received as the sum upon which duties are to ber assessed and collected.

Anybody know where one can read the full text of this revenue act? I searched to no avail.

As you can see the bolded sections illustrate the significant difference between sections 86 and sections 90. One must note that if section 90’s tax levied upon annual gains, profits or income meant the same thing as a tax on salary or payment, then section 86 would have been redundant. Had it been constitutional to levy a duty on the salary or payment to everyone residing in the United States this would have been explicitly stated that way. CTC’s contention, which in my opinion follows logically, is:

“By its explicit, separate, and otherwise unnecessary identification in section 86 of the remuneration of government workers as taxable--and taxed--this original enactment provides a rare, forthright statutory acknowledgement that the remuneration of private-sectors workers is not. After all if “gains, profits, or income derived from” pay is the same thing as the pay itself, the pay of government workers identified in section 86 would be being taxed under section 90, and the relevant portion of section 86 would be nonsensically superfluous.” Cracking the Code: The fascinating truth about taxation in america, p. 14

He further buttresses this contention using an analysis from Springer, in which the Supreme court ruled against Springer, who asserted that the taxation of his “income” amounted to an unapportioned direct tax. The court observed that treating a tax on “income” as direct would not be equitable.

“Where the population [of a state] is large and the incomes are few and small, it would be intolerably oppressive”

So from the CTC:

If “income” is understood as meaning ‘pay’ or ‘all that comes in’, the court’s observation is gibberish. It’s possible that one of the welfare states of today might come to have a large population with few people making a living, but in 1880 there certainly was no such place. With its observation, the court was matter-of-factly confirming the distinction between “incomes” and the common receipts of private sector persons, just as had the 1862 act.”

I will leave you with this to discuss. There is a little more to the chap but I have other stuff to do.

[Famspear]

Ducky, I'll just respond to part of your comments right now.

I believe LPC's comment about a couple of cases not being U.S. Supreme Court cases was a comment in response to what you or someone else had written, which was that the two cases in question were "Supreme Court" cases, or maybe "U.S. Supreme Court" cases. What LPC was pointing out was that the cases were Tennessee and Arkansas cases, not United States Supreme Court cases. In other words, not FEDERAL cases. I think you missed the point: Tennessee and Arkansas state courts are not the U.S. Supreme Court.

Separate point: State courts generally do not decide federal tax issues. If you want to litigate a question that will decide a point of federal tax law, you generally have to do that in a case against the federal government, AND the case has to be litigated in a federal court, not a state court.

You would be correct in saying that there is no requirement that a point of federal law has to be decided by the U.S. Supreme Court in order to really be "the law." All federal courts decide question of law. LPC was not saying that a point has to be decided by the U.S. Supreme Court to be the law. He was responding to the erroneous use of state court cases in trying to argue a point about federal law that those state court cases did not address.

[Mr. Mephistopheles]

I agree with Ducky's agreement with my own point, and I agree with Ducky's favorable citation to the Wikipedia text. It's a cogent, insightful text, in my opinion. The full disclosure: For better or worse, I am the author of all (or substantially all) of the quoted Wikipedia text.

Don't wrench your shoulder patting yourself on the back.

[Famspear]

I agree with Ducky's agreement with my own point, and I agree with Ducky's favorable citation to the Wikipedia text. It's a cogent, insightful text, in my opinion. The full disclosure: For better or worse, I am the author of all (or substantially all) of the quoted Wikipedia text.

Don't wrench your shoulder patting yourself on the back.

Too late, the damage is done. Can I go home and soak my shoulder in the tub?

[jg]

Section 86 has a provision for withholding by paymasters that is not in section 90. The specificaton of salaries of government workers is to identify the amount from which to "deduct and withhold the aforesaid duty of three per centum". So, it is not redundant even if some of the wording is repetitive. Hendrickson draws the wrong conclusion and ignores the substantive difference of deducting and withholding on the government workers salary.

Although it is unclear why we are discussing a revenue act that has long been replaced with more current statutes, there is available a copy of the 1862 tax return at http://www.taxhistory.org/thp/readings. ... _page1.jpg

That document says the tax is imposed on two classes; and it explains that the rates and deductions are different for the two classes. The result is that government employees residing abroad are taxed in the same manner as every person residing in the United States rather than in the manner for every citizen of the United States residing abroad that was not in the employment of the United States.
On the form, both salary as an employee or officer of the United States and salary from other than as an employee or officer of the United States are listed in the Detailed Sources of Income and the Amount Derived from Each as well as a line for "From all sources not herein enumerated".

I hope this helps for understanding the income tax as it was in 1862 (for what that is worth)

[LPC]

[LPC] also raised the issue with the other qoutes being from a court other than the supreme court. To that I ask, are rulings from a lower court not valid when debating?

They are valid if they are (a) relevant and (b) not misleading.

The cases you cited were not from a "lower court," but from the Supreme Courts of two different states, which you appeared to be passing off as U.S. Supreme Court cases in order to support your views of the federal constitution. The two court decisions interpreted *state* constitutional restrictions, not federal, and one of them was a minority view to boot.

They were therefore irrelevant to the discussion, and should not have been presented.

I also noted that although PH apparently quoted the minority opinion, the majority opinion didn’t differ much in substance.

Except to reach the opposite conclusion and the opposite result.

As far as the contention raised over the Murdock case, I will concede that the text is out of context in the sense that the “freedoms” do not refer to the right to earn a living. Upon reading the Murdock v. Pennsylvania, I found however, that the context of the case was quite relevant to the discussion. The main point of the supreme courts decision is that it is unconstitutional for a tax to impinge on one’s basic rights, in this case, the rights garaunteed by the first ammendment

Then you didn't read the decision very carefully.

The Supreme Court in Murdock specifically explained that the states can tax the *incomes* from activities even if they cannot regulate or prohibit the activities generating the incomes. The Supreme Court stated that "A state may not impose a charge for the enjoyment of a right granted by the federal constitution.” and IN THE VERY NEXT SENTENCE stated that “Thus, it [the state] may not exact a license tax for the privilege of carrying on interstate commerce (citation omitted), although it may tax the property used in, or the income derived from, that commerce, so long as those taxes are not discriminatory.”

Similarly, the Supreme Court has repeatedly stated that nondiscriminatory taxes can apply to newspapers and other publications protected by the First Amendment. (“It is beyond dispute that the States and the Federal Government can subject newspapers to generally applicable economic regulations [including taxes] without creating constitutional problems.” Minneapolis Star & Tribune v. Minnesota Commissioner of Revenue, 460 U.S. 575, 581 (1983). See also, Arkansas Writers’ Project v. Ragland, 481 U.S. 221, 228 (1987) (“a genuinely nondiscriminatory tax on the receipts of newspapers would be constitutionally permissible”); Grosjean v. American Press, 297 U.S. 233, 250 (1936) (“It is not intended by anything we have said to suggest that the owners of newspapers are immune from any of the ordinary forms of taxation for support of the government.”). Similarly, the Supreme Court has upheld an obligation to withhold Social Security taxes from the wages of employees even when the withholding violates the religious beliefs of the employer. United States v. Lee, 455 U.S. 252 (1982).

So the Supreme Court has consistently upheld the imposition of taxes on incomes even when the incomes are derived from the exercise of constitutional rights.

The inevitable and inescapable conclusion is that Congress CAN tax incomes from the exercise of "fundamental rights," and so Congress CAN tax wages and salaries from labor even if it is considered a "fundamental right." And there is NOTHING in the Constitution or any court decision under the federal Constitution that says anything different.

I think this is consistent with the argument of CTC, which basically holds that the tax on income is constitutional, but a tax on all that comes in, which is generated or realized by a most basic right, the right to earn a living, would be unconstitutional.

"Consistent" in the sense that it allows you to continue to hold the beliefs you want to hold, unsupported by any facts or law.

You continue to state your conclusion that "a tax on all that comes in, which is generated or realized by a most basic right, the right to earn a living, would be unconstitutional" but have yet to point to anything in the Constitution itself, or anything in any court decision in the history of the United States, that would confirm or support that conclusion.

[Mr. Mephistopheles]

I agree with Ducky's agreement with my own point, and I agree with Ducky's favorable citation to the Wikipedia text. It's a cogent, insightful text, in my opinion. The full disclosure: For better or worse, I am the author of all (or substantially all) of the quoted Wikipedia text.

Don't wrench your shoulder patting yourself on the back.

Too late, the damage is done. Can I go home and soak my shoulder in the tub?

Proceed! Be sure and take plenty of liquid painkiller in your flavor of choice.

[jg]

From SPRINGER v. U S, 102 U.S. 586 (1881)
at http://caselaw.lp.findlaw.com/cgi-bin/g ... &invol=586

There are four adjudications by this court to be considered. They have an important, if not a conclusive, application to the case in hand. In Hylton v. United States (supra), a tax had been laid upon pleasure- carriages. The plaintiff in error insisted that the tax was void, because it was a direct tax, and had not been apportioned among the States as required by the Constitution, where such taxes are imposed. The case was argued on both sides by counsel of eminence and ability. It was heard and determined by four judges,-Wilson, Paterson, Chase, and Iredell. The three first named had been distinguished [102 U.S. 586, 600] members of the constitutional convention. Wilson was on the committee that reported the completed draft of the instrument, and warmly advocated its adoption in the State convention of Pennsylvania. The fourth was a member of the convention of North Carolina that adopted the Constitution. The case was decided in 1795. The judges were unanimous. The tax was held not to be a direct tax. Each judge delivered a separate opinion. Their judgment was put on the ground indicated by Mr. Justice Chase, in the following extract from his opinion:--

'It appears to me that a tax on carriages cannot be laid by the rule of apportionment without very great inequality and injustice. For example, suppose two States equal in census to pay eighty thousand dollars each by a tax on carriages of eight dollars on every carriage; and in one State there are one hundred carriages, and in the other one thousand. The owners of carriages in one State would pay ten times the tax of owners in the other. A., in one State, would pay for his carriage eight dollars; but B., in the other State, would pay for his carriage eighty dollars.'
It was well held that where such evils would attend the apportionment of a tax, the Constitution could not have intended that an apportionment should be made. This view applies with even greater force to the tax in question in this case. Where the population is large and the incomes are few and small, it would be intolerably oppressive.
The difference in the ability of communities, without reference to numbers, to pay any taxes is forcibly remarked upon by McCulloh in his article on taxation in the Encyclopaedia Britannica, vol. xxi. (old ed.) p. 75.

Mr. Justice Chase said further, 'That he would give no judicial opinion upon the subject, but that he was inclined to think that the direct taxes contemplated by the Constitution were only two,-a capitation tax and a tax on land.'

Mr. Justice Iredell said: 'Perhaps a direct tax, in the sense of the Constitution, can mean nothing but a tax on something inseparably annexed to the soil. . . . A land or poll tax may be considered of this description. The latter is to be so considered, particularly under the present Constitution, [102 U.S. 586, 601] on account of the slaves in the Southern States, who give a ratio in the representation in the proportion of three to five.'

Mr. Justice Paterson said, he never entertained a doubt 'that the principal, he would not say the only, objects contemplated by the Constitution as falling within the rule of apportionment, were a capitation tax and a tax on land.' From these views the other judges expressed no dissent.

'Ellsworth, the Chief Justice sworn into office that morning, not having heard the whole argument, declined taking part in the decision.' 8 Wall. 545. Cushing, from ill-health, did not sit in the case. It has been remarked that if they had been dissatisfied with the result, the question involved being so important, doubtless a reargument would have been had.
In Pacific Insurance Co. v. Soule (7 Wall. 433), the taxes in question were upon the receipts of such companies from premiums and assessments, and upon all sums made or added, during the year, to their surplus or contingent funds. This court held unanimously that the taxes were not direct taxes, and that they were valid. bolding added

The court in the section above was discussing the decision in Hylton v. United States 3 U.S. 171 (1796) and the bearing of that decision on the Springer case.

In the bolded portion, Mr. Justice Swayne says the Constitution could not have intended that an apportionment should be made applies with even greater force to the tax in question in this case (approved July 1, 1862, and the act of March 30, 1864, as amended) than the tax in the Hylton case (a tax had been laid upon pleasure- carriages).

Hendrickson has misread, or misrepresented, what Mr. Justice Swayne said. The claim that "the court was matter-of-factly confirming the distinction between “incomes” and the common receipts of private sector persons" is not supported in reading the case. If not, please show us where this is done as it is not in the snippet Hendirckson abused in his book.

[Famspear]

As if we didn't have enough to chew on, I'm just going to throw this into the pot. Section 116 of the Revenue Act of 1864 (the Act that was the subject of the decision in Springer v. United States) imposed the federal income tax on:

the gains, profits, and income of every person residing in the United States, or of any citizen of the United States residing abroad, whether derived from any kind of property, rents, interest, dividends, or salaries, or from any profession, trade, employment, or vocation, carried on in the United States or elsewhere, or from any other source whatever[ . . . ].

See Revenue Act of 1864, 13 Stat. 223, sec. 116 (June 30, 1864) (bolding added).

Notice that, as is the case today, the income tax was imposed on everyone residing in the United States, whether citizen or not -- whereas for those residing abroad, it applied only to U.S. citizens.

I also have a copy of one of the Civil War era federal income tax return forms at home, not here at work (I think it's for the 1863 tax year), and it also clearly shows -- among other things -- that the income of non-government employees, etc., is taxable.

[Famspear]

By the way, just a note to all: the Springer case is often cited as being an "1880" case, because that's how it's shown on many of the case reports back then. The case was actually decided in January of 1881 (which of course is during the October 1880 term of the Court).

[Quixote]

I will assume rather than “they have” you meant to write “she/he has”

No, I think he meant to write "they", the third person singular neuter pronoun preferred by most English speakers over the older form "he/she".

But I have a question as to whether the existence of a non-taxable food item list has its basis in issues of constitutionality of taxation. I understand it is a subjective list, but imagine there is no list and that every single food item garners a sales tax, would this tax not impinge on , again, the basic right of life. As the only way I see of avoiding it would be to live off the land and grow your own food.

Living off the land and off the grid is essentially the only way to avoid most excises. I cannot think of any other way to avoid the federal excises on fuels, for example. Even if one never bought fuel, thus avoided paying the tax directly, one would pay the tax indirectly in bus fares and even in the price paid for food, which has the seller's fuel tax factored in.

Had it been constitutional to levy a duty on the salary or payment to everyone residing in the United States this would have been explicitly stated that way.

That is not necessarily so. Consider the manner in which the president's economic stimulus payments were implemented with regard to social security and VA beneficiaries. Adding $300 to one monthly VA or SSA check would have been the simplest and most cost effective means of accomplishing those portions of the project. Instead, Congress chose to handle the payments as a tax credit, which resulted in thousands (100's of thousands?) of people with no filing requirement to file returns and for the IRS to send separate checks, instead of simply increasing a regular monthly check. Congress could have done it either way. Their choice of one method is not evidence that the other method was barred to them.

[Famspear]

Ducky wrote:

Had it been constitutional to levy a duty on the salary or payment to everyone residing in the United States this would have been explicitly stated that way

Well, if you're saying that in order for it to be constitutional to levy a duty on the salary or payment of everyone, etc., the statute itself would have to have explicitly state it "that way" (either in the constitution or in the statute itself), that would be completely incorrect from a legal standpoint.

Perhaps you meant to say: "Had it been LEGAL UNDER THE STATUTE IN QUESTION to levy a duty on the salary or payment to everyone residing in the United States this would have been explicitly stated that way."

That would be statutory argument, not a constitutional argument. However, even if that's what you meant, that would be incorrect, too. There is no legal requirement that statutes be worded that way.

This reminds me of the pseudo-legal argument -- I think it may have been by Irwin Schiff, whose history is summarized here:

http://en.wikipedia.org/wiki/Irwin_Schiff

and who can be contacted here:

http://www.bop.gov/iloc2/InmateFinderSe ... &x=26&y=18

--that because section 22 of the 1939 Internal Revenue Code (defining gross income) included words like "salary" or "wages" and because its replacement -- section 61 of the 1954 Code -- dropped those terms and instead used the phrase "compensation for personal services", it was somehow the intent of Congress in 1954 to not tax "salaries" and "wages" under section 61. That argument has as much validity as the argument Ducky is presenting (which I guess is Peter Hendrickson's argument, not Ducky's). It's another impotent tax protester argument: that stuff has to be worded just the way they want it to be worded.

Same thing with court opinions. Again (I apologize, I noted this again just the other day), one Hendrickson supporter last year went so far as to argue, more or less, that compensation for personal services rendered by a private sector employee residing in Oklahoma was not gross income -- because there was no federal court case directly on point, involving a resident of "Oklahoma," ruling that "Oklahoma" was a "state" (thus, the employee was not a resident of the "United States," and thus not subject to the tax, so went the argument).

OK, OK, I admit the reference to Uncle Irwin was a cheap shot. I couldn't resist.

[grixit]

Continuing is good. But let's not move away from Chapter 1 of CTC until Ducky says whether or not they have conceded that Hendrikson was wrong on anything.

I will assume rather than “they have” you meant to write “she/he has”

No, i was using the word "they" in its singular sense as writers of english have done consistantly for a thousand years. I think "he/she" is a clumsy construction.

[Demosthenes]

I've always learned that using the generic plural form of "they" to get around the gender awkward choice of he/she was bad grammar.

I used to work as a tour guide at Hearst Castle during my college summers and wouild cringe every time I saw the sign, "Each person must hold their own ticket."

[Famspear]

My personal view is that "they" as a singular sounds enormously clumsy and grating. I like "he or she" much better.

I don't know if this is analogous, but in German they use "sie" for the singular sometimes. Conjugate the verb "sein" ("to be") in the present tense:

ich bin (I am)
du bist (you are, singular familiar)
er ist (he is - or "it is" (masculine)?)
sie ist (she is - or "it is" (feminine)?)
es ist (it is, neuter)
wir sind (we are)
ihr seid ("you are" in familiar plural)
sie sind (they are - or "you are" in either formal singular or formal plural)

So, "sie" can be "she" or "it" or "they" or "you".

Come to think of it, compared to the multiple use of the German "sie", I guess the English "they" as a singular ain't so bad after all.

[Quixote]

Continuing is good. But let's not move away from Chapter 1 of CTC until Ducky says whether or not they have conceded that Hendrikson was wrong on anything.

I will assume rather than “they have” you meant to write “she/he has”

No, i was using the word "they" in its singular sense as writers of english have done consistantly for a thousand years. I think "he/she" is a clumsy construction.

Did English exist in the year 1008? I thought "they" replaced "he" as third person singular neuter only recently to avoid the potentionally sexist connotations of the earlier usage.

I've always learned that using the generic plural form of "they" to get around the gender awkward choice of he/she was bad grammar.

That is the consensus among grammarians who see language as a static system. Those who recognize language as a dynamic system, realize that new rules will emerge when the old ones fail to work. English needs a third person singular neuter pronoun. Until a better candidate comes along, "they" is it. (Those last three words made me cringe.)

Language serves at least two purposes. It is a means of communication and a way of distinguishing "us" from "them". The use of "they" in place of "he/she" usually serves the first purpose. Context prevents confusion between the third person singular and the third person plural pronouns. It also serves the second purpose, though not necessarily for the speaker. Demo cringed at "Each person must hold their own ticket." because people who spoke the way Demo was taught to speak did not use "their" in that manner. The writer of that sign was not one of Demo's "us" or at least he wasn't trying to be recognized as one. He (or she) might have been aware that "their" was improper in the high status dialect, but chose to write in the lower status dialect to appear to belong to the "us" of speakers of one of the lower status dialects common among visitors to Hearst Castle. It is also possible that the sign's writer was not multi-dialectical and thought he was using "their" in a manner acceptable to everyone.