The Mammoth Book of Conspiracies

IRS

Donald Duck a conspirator? Unlikely as it seems, Disney’s famous cartoon character is alleged to be a player in the most successful financial conspiracy of all time.

It happened like this, according to Freedom Club USA. Two years into World War II, the US Federal Government realized that it was running out of moolah to best the Nazis and the Nipponese. To raise more lucre, Congress enacted into law the Victory Tax Act of 1942, a tax on income legitimized by reference to Article 1, Section 5, Clause 2 of the Constitution: “To support Armies but no apportionment for money to that use shall be a longer term than two years.” But how to get Americans to pay up for these taxes?

Enter screen left Donald Duck. The Treasury approached Walt Disney, who was given six weeks to make a short film “selling income tax” for distribution in the cinemas. Disney came up with a short film in which Donald Duck listened to a radio broadcast about how paying taxes would help win the war. So enamoured with the idea of paying taxes did Donald become that he filled in his tax return pronto and raced from LA to Washington DC in person to submit it. “Taxes to beat the Axis!” quacked Donald.

Morgenthau, Secretary of the Treasury, disappointed that the short featured a cartoon character, only reluctantly approved it for release. He need not have worried; an estimated 60 million Americans saw the The New Spirit short, and a snap Gallup Poll discovered that voluntary payments of income tax increased by 37 per cent. A year later a Treasury official reported to Congress: “Up until 1941 we never received as many as 8,000,000 individual income-tax returns in a year. In 1941 that number increased to 15,000,000; in 1942 it increased to 16,000,000. This year we expect 35,000,000 taxable individual income-tax returns.”

Another Disney short featuring Donald Duck, The Spirit of ’43, kept the money coming in. The Victory Tax Act was renewed in 1944 and was set to expire when the war was over. However, it remains in effect today, codified under the Internal Revenue Code at code section 3402 in subtitle C—Wage and Employment Tax. When WWII was over, Washington was simply unable to relinquish its new-found riches—the payroll tax the public had become accustomed to.

Tax, it may be said, is not a popular issue in the USA. On the morning of 18 February 2010, Andrew Joseph Stack III flew his single-engine Piper Dakota airplane at full speed into the IRS collections office in Austin, killing himself and one worker. Stack was on the libertarian right of American politics, but the Tax Protest movement spans the political spectrum: what binds it is the belief that income tax and the IRS are illegal. The words of the Tea Party Patriots will stand for the movement as a whole: “The Tea Party argues that even if the 16th Amendment to the US Constitution was properly ratified, which is debatable, the IRS still has no legal right to tax the income of American citizens.”

This is why Disney’s duck is a conspirator. He was part of a plot to persuade Americans to do something mandatory that should be something voluntary.

Actually, the two main claims of the tax protestors are dubious. Article 1 of the Constitution states unambiguously: “Congress shall have power to lay and collect taxes, duties, imposts and excises.”

It was Article I that allowed Lincoln to raise the money to fight the South. Furthermore, the16th Amendment, signed into law in 1913, declares: “Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”

Amendments to the US Constitution require the approval of 75 per cent of the States before they can become law. Officially, 79 per cent ratified the Amendment. Tax protestors, however, claim the ratification was invalid because the unhappily named Secretary, Philander Knox, ignored errors in the relevant documents, meaning the returns from these states were invalidated.

The documents do have errors; however, in the 1986 ruling on US v. Thomas, the Court ruled that the “deviations” were trivial and so “the [Solicitor of the Dept of State] authorized [Knox] to declare the amendment adopted”.

Where the tax protestors have firmer ground under their feet is on the matter of subsequent revisions to the tax process. As one former IRS commissioner, Shirley Peterson, noted, “Eight decades of amendments… to (the) code have produced a virtually impenetrable maze… The rules are… mysterious to many government employees who are charged with administering and enforcing the law.”

Even the IRS cannot understand the IRS. Legitimate questions can also be raised about the IRS’s behaviour and competence. In Unbridled Power, Shelley L. Davis, the IRS’s first and last historian, laid bare a secretive organization which compiled lists of “enemies” and routinely destroyed records—a federal offence—which might prove incriminating or embarrassing. Before a Senate Finance Committee hearing, she testified that crucial IRS records, pertaining to government, states and individuals, “have been destroyed. Gone. Shredded. Tossed. They no longer exist… No other agency of our government could get away with this… Our fear of suffering a personal attack from the IRS generally keeps most of us in check… This ensures that it can never be held accountable for its actions. How can you prove any wrongdoing when the evidence is already destroyed?”

How indeed? Fortunately, a few whistle-blowers, such as Davis herself, have done the right thing and spoken out. Some of the IRS’s wrongdoing is staggering. At Nixon’s request, it launched investigations of his opponents for his purely political purposes and no other reason at all. One such “enemy” was the Fund for Investigative Journalism, which funded Seymour Hersh’s reporting on the My Lai massacre. In the words of Nixon’s aide John Dean, the idea was to “use the available federal machinery to screw our political enemies”.

Further Reading

John A. Andrew III, The Power to Destroy, 2002

Shelley L. Davis, Unbridled Power, 1998

www.freedomclubusa.com/donald_duck_tax

ISRAELI BUBBLEGUM

In spring 1997, the Palestinian Authority reported on an Israeli plot fiendish in its machinations and consequences: to infiltrate into the West Bank and Gaza bubblegum laced with sex hormones to be sold at a discounted rate outside schools. The bubblegum aroused the sexual appetite of girls, but simultaneously sterilized them, suppressing Arab population growth. Worst of all, according to Palestinian Supply Minister Abdel Aziz Shaheen, it was capable of “completely destroying the genetic system of young boys”.

According to Palestinian tests, the strawberry-flavoured gum was spiked with progesterone, one of the two hormones of femaleness. That Israel, an essentially Western society, should try to undermine Islamic morals with sex pills played on deep Palestinian fears.

The Washington Post commissioned tests on allegedly contaminated bubblegum. These tests were done by Dan Gibson, professor of pharmaceutical chemistry at Hebrew University and a member of the left-wing lobby group Peace Now (thus no Zionist). Using a mass spectrometer capable of detecting as little as a microgram of progesterone, he found no trace of the hormone in the gum.

In fairness, a story of adulterated food was not entirely implausible. Shady Israeli merchants, working in collaboration with Palestinian profiteers, had shipped canned baby food to Gaza which turned out to be soy formula past its sell by date. But weighing against the Palestinian bubblegum claim—aside from the Washington Post’s spectrometer test—was its timing: Israel and Palestine were in the middle of a propaganda war, with both sides making things up.

So, pop went the great Israeli bubblegum conspiracy. It blew up again in 2009 when Hamas charged Israeli intelligence operatives with distributing libido-increasing gum in the Gaza enclave. A Hamas police spokesman in the Gaza Strip, Islam Shahwan, announced: “The Israelis seek to destroy the Palestinians’ social infrastructure with these products and to hurt the young generation by distributing drugs and sex stimulants.”

Numerous teenage boys reportedly asked, “Where can I buy some of that gum?”