During the legislative and subsequent state ratification debates over the 16th Amendment -- which established the income tax -- the political task of overturning the Constitution's prohibition of such tax was considerably eased by political promises that any income tax levied would fall upon only the wealthiest 3 to 5 percent of the population. Most Americans paid no federal income tax, and those earning $500,000 or more paid only 7 percent. In 1913, only 358,000 Americans filed 1040 forms, compared with today's 140 million. That's the rope-a-dope strategy. To get the votes of the masses, politicians start out small and exploit the politics of envy by promising that only the rich will be taxed.
In 1898, Congress imposed a temporary federal excise tax on telephones as a revenue measure during the Spanish-American War. At that time, only the rich owned phones. Soon nearly all Americans owned phones. Both the rich and the poor paid the telephone excise tax. Congress repealed this "temporary" Spanish-American War tax in 2006. Nobel laureate Milton Friedman had it right when he said, "Nothing is so permanent as a temporary government program."
The Tax Reform Act of 1969, called the alternative minimum tax, was created to raise revenue from 155 "rich" Americans who legally avoided federal income taxes by buying tax-free municipal bonds. Today more than 4 million Americans are hit by the AMT, and most of them hardly qualify as rich.
Here's another rope-a-dope just beginning. The National Transportation Safety Board recently recommended that states reduce the allowable blood alcohol content by more than a third -- to 0.05 percent, as opposed to today's 0.08 percent. The NTSB is calling it a recommendation just to test the waters. If the board doesn't see resistance, its next move will be to threaten noncomplying states with a cutoff of highway construction funds. Setting the legal limit at 0.05 percent is not these people's end objective. Their end objective is to outlaw any amount of alcohol in the blood while one is driving.