Monetary Policy Reform

Monetary Policy Reform
 

• Establishes three types of United States currency: standard silver coin and gold coin (restores Constitutional currency), and treasury credit-notes
   
• The United States Treasury buys and cancels all outstanding capital stock of the former Federal Reserve Banks
   
• The privately owned Federal Reserve System is abolished, returning ownership of the national currency to the people through a newly created United States Treasury Reserve System
   
• A new Board of Governors of the Treasury Reserve System uses a specific law-mandated plan to maintain and stabilize the exchange value of the currency
   
• The new Board assumes all powers and responsibilities of the former Federal Open Market Committee, eliminating private control of the nation’s monetary system
   
• The existing regional Federal Reserve Banks become Treasury Reserve Banks and continue clearinghouse operations and other bank service functions under the direction of the Office of the Comptroller of the Currency
   
• All commercial banks must exchange their income-producing government obligations for treasury credit-notes (reduces the national debt)
   
• Only treasury credit-notes may be held as bank reserves
   
• Fundamental changes are imposed on the repayment of all outstanding fractional reserve loans on secured property—principal must be repaid before the monetizing-fee is paid (applies retroactively to existing mortgages reducing private debt)
   
• A progressive federal excise tax is imposed on the privilege of making commercial loans of currency for profit
   
• Commercial financial institutions such as credit unions are provided, subject to some restriction, with opportunities to operate with fractional reserves

LIABILITY FOR AND DISPOSITION OF THE NATIONAL SALES AND USE TAX

(A) Every seller dealing in commerce shall be liable and responsible for collecting the national sales and use tax lawfully due and remitting it to the National Tax Service. Purchasers are liable for payment of the tax to the seller. The tax upon a credit sale of moveable property is due and payable in full at the time of the sale. The tax upon a credit sale or a contract for sale of immovable property where the purchase price is paid in installments is due and payable on each installment payment. If any seller transfers, sells, assigns, or otherwise disposes of an account receivable, they shall be deemed to have received the full balance of the consideration of the original sale and shall be liable for the remittance of the tax on the balance of the total sale price not previously reported. (B) The national sales and use tax is to be collected by the seller from the purchaser only at the retail, end or final transaction and not from wholesalers, or from intermediate sales of items directly used for or incorporated into the manufacture of a product to be ultimately sold at retail, or from sales made to exempt entities such as those made by contractors or subcontractors to the United States government, to its departments and institutions and its political subdivisions when acting in their governmental capacities only, or sales made to qualified exempt organizations. (C) There is no limit to the number of times a particular article may be subject to the national sales or use tax. Each time it returns to the stream of commerce, the purchaser must pay and the seller collect and remit the tax unless the sale is exempt. (D) The burden of proving that any particular person is liable for payment, collection or remittance of the national sales and use tax shall be on the National Tax Service. (E) Tax payments made by a purchaser to a seller and documented by written receipts or certificates amount to payments by the purchaser to the National Tax Service, discharging their tax liability. (F) In case of a dispute between the purchaser and seller about whether any particular sale is exempt from the national sales and use tax, the seller shall collect and the purchaser shall pay such tax and the seller shall then issue to the purchaser a receipt or certificate showing the name of the seller and the purchaser, the item or items purchased, the date, price, amount of tax paid, and a brief statement of the claim of exemption. The purchaser may then apply, within sixty days of the date of the sale, to the District Director of the National Tax Service of the district in which the purchaser resides or in which the sale was made for a refund of taxes paid. It is the duty of the District Director, or a duly qualified deputy, to resolve the question of exemption and to provide written notice of such determination and the appropriate refund plus interest calculated at the rate of 12 percent annually, where applicable, to the purchaser within sixty days of the date of the application for refund, subject to review within one year by a court of competent jurisdiction. (G) Excess national sales and use tax inadvertently collected must be remitted to the National Tax Service when not refundable. (H) Credit Certificates equal to 10 percent of any contribution valued at $250 or more made to qualified charitable organizations shall be issued by the National Tax Service if the charitable organization is recognized by the National Tax Service, if it applies for the Credit Certificate in the donor’s name, and if it submits proof of the contribution with each application. These certificates are applicable to any national sales and use tax liability. (I) Remittances discharging a seller’s national sales and use tax liability shall be made in full to the National Tax Service at any authorized federal depository on or before the tenth day of each month for all taxable transactions occurring during the previous month. Any seller doing business in two or more locations which are in different districts may elect to make consolidated deposits and file consolidated reports in a single district. (J) Summary documentation, also called a return or report, of monthly tax remittances may be submitted (postmarked) to the District Director of the National Tax Service of the district in which a tax deposit was made not less than five working days after the tax due date. (K) Each seller who, acting as agent for the National Tax Service, submits timely summary documentation for remitted tax is allowed to deduct 1 percent of tax deposits timely made to offset their expense in its collection and remittance. They shall also be subject to a penalty of 2.5 percent per month, cumulative each month to a maximum of 15 percent, for late deposits. Besides the penalty, late deposits shall be subject to interest charges at the rate of 1 percent per month. Inadvertent clerical errors are subject to interest but not penalty charges. (L) Credit Certificates issued by the National Tax Service are transferable in commerce and shall be accepted for tax payments at full face value at authorized federal depositories or may be remitted for tax liabilities with the summary documentation. (M) Any seller dealing in commerce who sells their business, or stock of goods, or quits business, shall be liable to file a final return with the National Tax Service within thirty days of such action. The seller’s successor in the business, if any, becomes liable for the collection and remittance of taxes on future sales and for taxes due and not remitted on current sales, unless they hold a receipt or certificate showing that the taxes were paid. (N) In cases of unusual circumstance, such as a natural disaster or a personal hardship, penalty or interest charges or any portion thereof on late deposits may be waived by a District Director of the National Tax Service or by Executive Order of the President of the United States. (O) Certificates of National Sales and Use Tax Exemption, identified by number and valid for twelve months, shall be issued to qualified and approved purchasers or sellers within sixty days of the application date made to a District Director of the National Tax Service. The District Director shall provide forms for such application and for the certificates and shall have the authority to verify that the purchaser or seller is, in fact, entitled to exempt status. (P) Sellers who make sales exempt from the national sales and use tax with valid exemption certificates issued by the National Tax Service, except those made to the United States government, are required to maintain records of such sales by item, date of sale and exemption certificate number for two years from the date of the sale. Sellers may, at their option, provide an itemized summary report to the National Tax Service of their exemption certificate sales on the same basis as if the sales had been subject to the tax. Each reporting seller making timely reports shall receive a Credit Certificate applicable to national sales tax liabilities equal to 0.15 percent of the total amount of exempt sales reported, except those made to the United States government, to cover the expense in the collection of data and the submission of the itemized summary report. (Q) Fifteen percent of the total amount of monies collected by the National Tax Service each month shall be immediately deposited to the Treasury Reserve Account and may not be transferred, appropriated or expended by the United States Treasury without authorization of the Board of Governors of the Treasury Reserve System. (R) All secondary sales of commercial investment securities of whatever type, both domestic and foreign, and all sales of commercial enterprises and business investments, in whole or in part, both domestic and foreign, made by foreign persons not subject to the jurisdiction of the United States to purchasers subject to the jurisdiction of the United States, whether resident of the United States or of a foreign nation, shall be made through an independent broker approved by the National Tax Service. The independent broker shall be liable and responsible for collecting the national sales and use tax lawfully due and remitting it to the National Tax Service.

NATIONAL SALES AND USE TAX IMPOSED

(A) There is hereby levied, and there shall be collected and paid, a tax of 14 percent upon the consideration or the purchase price paid or the fair market value of the retail sale or use of all property or rights to property or the conversion of taxable property or services to private or personal use and upon all secondary sales of commercial investment securities of whatever type, both domestic and foreign, and upon all sales of commercial enterprises and business investments, in whole or in part, both domestic and foreign, exchanged in commerce by any person within the jurisdiction of the United States of America, excepting those items specifically excluded from this national sales and use tax by Act of Congress. (B) There is hereby levied, and there shall be collected and paid upon gaming activities and services by the gaming sponsor, a tax of 8 percent of the gross gaming receipts less total gaming payoffs to chance purchasers and government entities or sponsors, when acting in their governmental capacities only. (C) Exemptions: (1) All sales to the United States government, to its departments and institutions, and to its political subdivisions, when acting in their governmental capacities only; (2) All sales of licenses, permits, passports, visas and all charges for public services or user fees made by the United States government or the governments of the States or Territories of the United States and their political subdivisions, when acting in their governmental capacities only; (3) All sales of precious metal bullion, coins, and currency; (4) All sales made to or by charitable organizations in the conduct of their regular activities or charitable functions and where their sales are not for profit and are not unduly competitive with sales made by others subject to the tax; (5) All sales made to or by nonprofit schools where the items purchased or sold by the school are not for pecuniary gain, are required for normal rather than extraordinary operation, and where all sales made to the public—such as books sold at a school-operated book store or tickets to public events or food service at school-operated cafeterias, snack bars, or student unions—remain taxable; (6) All sales of drugs dispensed by prescription; of all corrective eyeglasses, contact lenses, or hearing aids; of all therapeutic agents, devices, appliances, or their related accessories or materials when furnished, prescribed or recommended by any licensed practitioner of the medical arts for the treatment or relief of any human impairment or disability; and all compensation or fees paid to licensed practitioners of the medical arts for their professional services; (7) All sales in the nature of rents or leases of real estate for which a written agreement exists providing for the exclusive use by any person for any continuous period of not less than sixty consecutive days; (8) All sales of groceries; (9) All sales of plants, livestock and fish customarily used in the production of food for human consumption; embraces—all sales of meat cattle, sheep, lambs, poultry, swine, and goats; all sales of livestock for breeding purposes; all sales of live fish for stocking purposes; all sales of feed for livestock; all sales of seeds, orchard trees or other plants for food production; (10) Incidental or occasional sales, not exceeding three events per year, of used tangible private property where the primary motive for the transaction is trade rather than profit through commerce and where the transactions are made through use of “want ads” or as a part of a “yard” or “garage” sale; (11) Incidental or occasional sales for the purpose of recycling materials; (12) Fifty percent of the purchase price paid for the retail sale of all used tangible property exchanged in commerce, excluding remanufactured items sold with warranties exceeding 90 days; (13) Ninety percent of the purchase price paid for all secondary sales of commercial investment securities of whatever type, excluding the transferable securities of the United States government and all its political subdivisions which are exempt from the tax; (14) All sales of insurance or surety bonds; (15) Meals provided by employers to employees at their places of employment at no charge or at reduced charges which are considered as partial compensation for their labor; (16) The identified and segregated labor portion of written retail contracts, such as professional service, construction, maintenance and service industry contracts; (17) Real estate transactions to the extent that the national sales tax has been paid, or would have been paid had this Act been in force, coincidental with the previous retail transaction or for transactions in progress when this Act becomes law; (18) All sales of printed matter of a periodical nature, such as newspapers, magazines, news letters, directories and sales catalogs that are nonprofit in nature or whose primary purpose is to promote sales subject to the national sales and use tax or to carry paid advertisements subject to that tax. (19) Compensation paid for celebrity endorsements to the extent that they are personally promoting or autographing their own products or talents but not personal endorsements or reproduced stamped or printed autographs on other commercial products. (20) Compensation paid for the domestic sale, use or licensing of patents, copyrights, or processes in domestic production but not foreign sales. (22) Any premiums, benefits, or alternate currencies, for example, “coupons” or a “free” airline ticket based on “frequent flyer miles,” derived from taxable transactions in commerce upon which the imposed tax was collected and whose primary purpose was to promote those taxable commercial transactions.

REFORMATION OF THE FEDERAL RESERVE SYSTEM

SECTION 5. REFORMATION OF THE FEDERAL RESERVE SYSTEM

(A) The Federal Reserve Act of 1913, as amended, is hereby further amended, as per its provisions for the dissolution of and recovery of assets of the Federal Reserve System.  (B) Administration of the Federal Reserve System is hereby vested in the United States Treasury in a new department of the Treasury, hereby established and called the United States Treasury Reserve System or by the short title of Treasury Reserve System. (C) A Board of Governors of the Treasury Reserve System is hereby established and charged with the administration of the Treasury Reserve System, to exercise all powers and duties granted within the provisions of this Act and those powers and duties, some of which are subject to modifications by this Act, previously specifically granted to the Board of Governors and to the Federal Open Market Committee of the Federal Reserve System. This Board will consist of thirteen officers including a Director of the Board plus one Governor of the Board from each of the existing twelve Federal Reserve Bank Districts, hereafter called United States Treasury Reserve Districts. (1) All officers of the Board of Governors of the Treasury Reserve System will be appointed by the President of the United States with the advice and consent of the Senate, the initial selection of all thirteen officers commencing with the passage of this Act and following the guidelines set forth herein. Selection shall be made without discrimination because of race, creed, color, sex, or national origin. No individual who is or has been a Senator or Representative in Congress shall be an officer of the Board of Governors of the Treasury Reserve System.  (2) The officer who serves as Director of the Board of Governors of the Treasury Reserve System: (a) shall be a United States citizen; and,  (b) shall be selected from the nation at large; and,  (c) shall be a person of tested banking or economic experience; and,  (d) shall receive a salary equivalent in amount to the salary of a member of the United States Senate; and,  (e) shall maintain an office within the District of Columbia; and,  (f) shall have no specific term of office, being replaced at the pleasure of the President of the United States with the advice and consent of the Senate. (3) Each officer who serves as a Governor on the Board of Governors of the Treasury Reserve System: (a) shall be a United States citizen; and,  (b) shall have been a resident for at least two years of the Treasury Reserve District which they represent; and,  (c) shall be actively engaged in their Treasury Reserve District in commerce, agriculture, the medical arts, education, industry, services, or consumer or labor affairs; and,  (d) shall not at the time of their selection, nor at any time during that period of service, be or have been an officer, director, employee, or a direct stockholder of any bank; and,  (e) shall not have held State elected or appointed office; and,  (f) shall not be an Officer of the Court, a Member of the American Bar Association, nor a practicing Attorney; and,  (g) shall maintain an office within the Treasury Reserve District which they represent; and,  (h) shall receive a salary equivalent to the salary of a member of the United States House of Representatives; and,  (i) shall, on good behavior, serve a minimum term of four years, being replaceable at the pleasure of the President of the United States with the advice and consent of the Senate except that, after initial selection of all thirteen officers, no more than four of the twelve Governors may be replaced in any one four-year period or in any one presidential term of office. (4) A Lieutenant Governor will be selected for each of the twelve Treasury Reserve District Offices in the same manner and under the same guidelines as are Governors except that, after the initial selection, more than four new selections for that office are permitted in any one presidential term when the purpose of each additional selection is to fill an office which becomes vacant. Each Lieutenant Governor— (a) shall receive a salary equivalent in amount to 85 percent of the salary of a member of the United States House of Representatives; and,  (b) shall assume the powers, responsibilities, duties and salary of the Office of the Treasury Reserve District Governor upon the resignation or during any period of incapacity of the Governor of the District or in the event that the holder of that office is convicted of a felony. (5) All officers of the Board of Governors of the Treasury Reserve System will receive their written Delegations of Authority from and be sworn into office by the Secretary of the Treasury. (6) All officers of the Board of Governors of the Treasury Reserve System are hereby charged to administer the affairs of the nation’s monetary system with the sole purpose of maintaining a long-term, stable exchange value for United States Treasury credit-notes. (a) All actions undertaken by the Board will require an affirmative vote, recorded as part of the public record in the District of Columbia Office of the Director of the Board of Governors, by nine of the thirteen officers. (b) The officers need not be physically present in order to cast their vote. (D) A Treasury Reserve Account which will be administered at the sole discretion of the Board of Governors of the Treasury Reserve System is hereby established. (E) The Federal Open Market Committee of the existing Federal Reserve System is hereby abolished, its powers and responsibilities being transferred to the Board of Governors of the Treasury Reserve System. (F) All rights, titles, properties, interests, and every claim of the Board of Governors of the Federal Reserve, of all Federal Reserve Banks, of all member banks, of all Federal Reserve agents, and of all individuals, in and upon the Federal Reserve System is hereby transferred to and vested in the United States Government to be held in and administered by the United States Treasury under the Treasury Reserve System.

Excessive debt, both public and private, is the cause of much of this nation’s economic distress.

SECTION 2. FINDINGS

The Congress finds that — (1) an excessive debt, both public and private, is the cause of much of this nation’s economic distress. (2) outdated banking, monetary and fiscal practices, supported by national statutes, codes and regulations, led to the creation of a large portion of this debt. (3) the nation’s privately owned central banks of the Federal Reserve System exercise significant control over the national economy through manipulation of monetary policy. (4) the private character of the Federal Reserve System was recognized in the Act creating the system when Congress reserved to itself “[t]he rights to amend, alter, or repeal” the authorizing legislation. (38 Stat. 251, 275) (5) the reservation of “[t]he right to amend, alter, or repeal” the Act establishing the Federal Reserve System displays Congressional concern to obviate any possibility that the private parties comprising the Federal Reserve System might acquire, directly in or through application of the statute, any rights, powers, privileges or immunities that the courts could later hold were constitutionally immutable. (6) the federal courts have also recognized that, although the Federal Reserve System may perform various functions purportedly on behalf of the national government, it is not an agency of the United States. Lewis v. United States, 680 F.2d 1239, 1240 (9th Cir. 1982) (7) the Supreme Court of the United States noted in 1896 that “National banks are instrumentalities of the Federal government, created for a public purpose, and as such necessarily subject to the paramount authority of the United States.” Davis v. Elmira Savings, 161 U.S. 275 (8) the Board of Governors of the Federal Reserve System and the Federal Open Market Committee were given a mandate to “maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.” (9) the performance of the Federal Reserve System, particularly in pursuit of its mandate to “promote …stable prices and moderate long-term interest rates,” has been considerably less than satisfactory. A 1950 dollar is worth only 18 cents in 1990, losing 82 percent of its value in 40 years. (10) changes in the economic behavior of the American people, particularly since World War II, have greatly reduced the ability of the Federal Reserve System to regulate monetary policy. (11) Federal Reserve System regulators struggle to maintain stability, hampered by conflicting goals and grossly inadequate monetary tools. (12) the authority of Congress to issue irredeemable, legal tender paper currency, or to delegate such a power, finds no basis in Article I, § 8, cl. 5 of the United States Constitution, which grants Congress the power “To coin Money, [and] regulate the Value thereof.” (13) the constitutional power “To borrow Money” found in Article I, § 8, cl. 2 does not authorize Congress to issue “Bills of Credit” or to delegate such a power. (14) reconstruction of the national banking and monetary system can begin based on the unquestionably constitutional premises that: (a) Congress has the power and duty to provide the nation with a sound monetary system; and, (b) Congress has the power to borrow money; and, (c) Congress has no power or privilege to emit bills of credit, nor to delegate such a power; and, (d) Congress has the power and duty to protect commerce from irresponsible banking practices.  (15) the reform of the current monetary system as outlined in this Act is necessary to ensure the American people of their unalienable rights to Life, Liberty, and Property, and to provide for them a constitutionally accurate, sound, safe, and honest medium of exchange.