"Fifty Checks from Fifty States", a better way to fund government

Suppose the current method of funding the federal government was trashed and

replaced with one that eliminated all direct federal income taxes with funding

by the fifty states, each sending  a 'check' to Washington, proportional to the size

of its economy. 

Call it "Fifty Checks...from Fifty States".

Its important to understand this alternative was first considered by our founders:

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From "Anti-Federalists" 1789, beginning on page 182:

The government needed a 'greater and more certain revenue'.  Some believed money 

should be collected by the states and used by the states where the revenue accrued, 

except for a specific amount granted to Congress.

If the Anti-Federalists dominated the government our country would have continued 

as a confederation of sovereign states and democratic principles of local self-government 

would have been emphasized.

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Continuing:

Ever since our founding, the leaders of the country kept applying new laws to
fund government. At first they refused to have a general income tax, relying on
tariffs on select imported products.

Over time Congress, with sole authority to tax, imposed a variety of taxes that 

heavily favored some states than others based on commerce or agriculture.

The first true 'income tax' was authorized to pay for the Civil War in 1861,
replaced in 1862 and continued until it was rescinded in 1872. Attempts to
seek funding were halted when the Supreme Court ruled them unconstitutional.  

The remedy came  in 1913 when the 16th Amendment was adopted and added
to the Constitution, legalizing a tax on all incomes!

Since then the amount of taxes paid by citizens and businesses increased as
our economy grew to the size it is today, now valued at eighteen trillion dollars,
based  on the accepted financial measuring stick, the GDP,  the Gross Domestic
Product. (More about this later)

Today, taxation is still an issue continually discussed by those who seek to make 

it fairer or changed to generate more revenue.  

There are opposing schools of thought; some say just lowering rates will spur 

economic growth and automatically increase revenue while others contend 

lowering rates would require additional revenue to offset what they view as a

'lose', dismissing  the benefit of greater purchasing power. The term used to

describe this belief is 'revenue neutral', meaning for every dollar not received

due to tax cuts must found elsewhere, a theory I cannot find evidence to support. 

These are the weeds people who decide how to fund the government cannot

seem to escape from. And as long as they argue within these boundaries, they

will miss a better solution that was recognized at the time of our founding,

proportional funding by states.

When the US Constitution went into effect in 1789 there were thirteen states,

some large, some small, some richer than others so proportional funding was

essential to allow all colonies to thrive, no different than we find today as

our fifty states are equally disparate.  

At the outset this approach was applied, however tax policies drifted and the

burden was finally placed on enterprise and individuals, creating a system 

continually tinkered with to do more than simply increase revenue.

Despite more than two hundred and thirty years between than and now, 

proportional approach still has merit and again deserves consideration in 

tax policy discussions. 

Adopting the "apportioned among the states" approach may be the best 

way to fund the national government as well as it will do more than change 

the dynamics of the way revenue is collected, it would transform the entire 

American governing mechanism!

The first advantage is purity, do what it is intended to do, fund government!

"Apportioned among the states" has this single task, pay for what the national

government provides, and nothing more.

There will be no need for 70,000 pages of a tax code created solely to modify

human behavior, and influence decisions that have financial implications.

Even more important is the benefit of eliminating the need for Washington to 

be ground zero for tax policy. Washington should be about governance, which

is hard enough considering the scope of our country's responsibilities. 

Removing Congress from tax policies, uncouples politicians from a power that 

can easily influence them, often the haven for corruption in all forms that has

become prevalent in Washington.  Proportional state taxation ends this!

The new day begins when workers receive paychecks without a deduction for

"Uncle Sam".  No longer will the IRS tax code guide individuals and businesses 

to do what they would prefer not to do.  No longer will lobbyists have power to 

affect our taxes, even as you have no knowledge they do!

Rather than the IRS taxing individuals and businesses to fund the government

each state would pay the proportional amount determined on its wealth to

Washington to cover the cost of government.  Its that simple!

States will be the sole revenue source for federal funding. They will determine

how they collect their proportional contribution from its residents. 

How it works.........

Individuals and businesses will no longer be required to pay federal income 

taxes. All their earnings remain in the state. They will only be required to pay

what state legislatures require. 

Revenue received through "apportioned among the states" is the first step to

give the people the government they want, rather than politicians demand. 

States will finally reign in Congressional and bureaucratic overreach
of both legislation and regulations they never asked for or do not want.
States will have the "power of the purse" and Congress will have to seek
approval of state legislatures rather then each state's representatives that
often do the bidding of the Washington 'establishment'.

Federal mandates would be minimal as members of Congress must pay

attention to what their constituents want, rather than what donors and 

lobbyists demand! 

State governors and legislatures would drive national governance as the

'anti-federalists' argued was best to ensure the people were no longer 

submissive to Washington.

"Apportioned among the states" results in each state paying the appropriate 

percentage of its GDP to Washington so Congress would receive revenue
equal to what its spends.

The federal government will no longer be able to 'borrow', passing along the
debt to taxpayers. It would have to convince the states to give more then their
proportional obligation. 

Using the Gross Domestic Product (GDP)

The GDP will be the determinant. States with the highest GDP, such as  Texas

and California would send more than states with smaller GDPs.

The size of the country's Gross Domestic Product (GDP) is $18 trillion, equal
to the total GDPs of the fifty states.  Each state shares a percentage, with the
wealthiest California at 14.7% while others vary, such as New Jersey is at 3.3%.

Annually, taxpayers send $3 trillion to Washington. Replacing the income tax
with "apportioned among the states" will still provide the same $3 trillion, only
it will be paid by states, not individuals and businesses, calculated by each state's
GDP. 

California with the highest GDP would pay its proportion of the country's
$18 trillion GDP, as its 14.7% equals $443 billion based on its wealth of
$2.6 trillion while New Jersey with a GDP at 3.3% would pay $98 billion
based on its wealth of  $590 billion.

For the first time  in our history the federal government will only have a minor
role in taxation,  as the responsibility falls directly on the states.

"Apportioned among the states" will be the revenue generator,  a 'game changer', 

turning the national government into an honest broker, serving the interests of
the states, businesses and citizens. 

The benefits realized are almost incalculable considering the varied responsibilities

our government has domestically and around the world.

The majority of the 70,000 page IRS tax code can be trashed.  There will be no 

need for organizations of any type to seek tax avoidance. Each state will make 

such judgments.

"Adventurous" presidents and Congresses will no longer deploy troops and arms

at a cost of billions that were not included in operating budgets or approved by

emergency request to the states. 

Federal agencies would shrink as the state will prefer to not send larger 'checks' 

based solely on state priorities, not Washington's.

In fact, under apportionment states seeking independent aid from the federal govt. 

would supplement required revenue with an additional amount to cover request.

Rather than taxing individuals each state would send a 'check', proportional to its

wealth to Washington to cover the cost of government.  Its that simple!

The states will be the sole revenue source for federal funding. They will determine

how they collect their proportional contribution from its residents which means 

individuals and businesses no longer will they be required to pay federal income

taxes, only contribute as their state legislatures require.  

Revenue from "apportioned among the states" is the first step to get the government

the people want, not what politicians decide is good for them.

Could such an unorthodox tax plan materialize?  It can if the benefit to the states outweigh

the lose of control Washington would accept. 

Regards,
Anthony Bruno