The Best Kept Secret - The Biggest "Tax Loophole" of All

Who Worded The 16th Amendment?

by Otto Skinner

Nelson W. Aldrich of Rhode Island was the Republican "whip" in the Senate, a business associate of J.P. Morgan, and the maternal grandfather of Nelson A. Rockefeller and David Rockefeller. He was a member of the Senate Committee on Finance in 1909. He was known as the Wall Street Senator; a spokesman for big business and banking. He was wealthy in his own right. One of his "toys" for demonstrating his wealth and power was his own private luxurious railroad car.

A close associate of Senator Aldrich was Paul Warburg, a partner in Kuhn, Loeb & Company, and the architect of the Federal Reserve Act of 1913 which authorized private banking firms to essentially create money out of nothing and loan it our at interest. Paul Warburg eventually became a member of the Federal Reserve Board. While Paul Warburg was involved with the Federal Reserve Banks in the United States during WW1, his brother, Max Warburg, was the Director of the Reich Bank in Germany and the financial advisor to the Kaiser. To say the least, Senator Aldrich was well entrenched with the world banking powers.

Senator Aldrich was a strong proponent of an "income" tax amendment to the Constitution. The congressional records show that finding the proper wording for such an amendment seemed to be a bit difficult. Several attempts were made. On June 17, 1909, Senator Norris Brown of Nebraska introduced Senate Joint Resolution 39 proposing that the Constitution of the United States be amended as follows:

"The Congress shall have power to lay and collect direct taxes on incomes without apportionment among the several states according to population." S.J. Res. 39, as read in the Congressional Record Senate, page 3377, June 17, 1909, by Senator Norris Brown.

The resolution was printed and referred to the Senate Committee on Finance. Those masterminding the plan knew that if the amendment authorized a direct tax, it would cause one part of the Constitution to come into irreconcilable conflict with Article 1, Section 2, Clause 3 and Article 1, Section 9, Clause 4.

Senator Aldrich controlled the discussion regarding the proposed amendment during the hearings in the Committee on Finance. He told the committee that he would be gone for a few days and when he came back he would tell them how to write the proposed Sixteenth Amendment. A few days later, he returned with the new wording as promised. On June 28, 1909, he brought back this new wording to the Senate under a new joint resolution (S.J. Res. 40) which DID NOT contain the word "direct", but which reads exactly as the sixteenth amendment reads today:

"The 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." S.J. Res. 40, as read in the Congressional Record Senate, page 3900, June 28, 1909, by Senator Nelson Aldrich.

The sixteenth amendment was presented to the American people as a "soak-the-rich" scheme. Yet, it was the richest of the rich who were in back of the scheme with the purported intention of supposedly soaking the rich. They were very careful to write an amendment in a manner that would pass constitutional muster in the United States Supreme Court, and yet lead the American people to erroneously believe it was an amendment granting Congress some sort of new taxing power.

Senator Aldrich's connection with the so-called "income" tax and the Federal Reserve System is extremely important. Both were designed to fool the American people for the benefit of the private banking interests. Both were designed to bleed the hard working Americans of more and more of their production and manipulate them, and the nation, into deeper and deeper debt. The Federal Reserve System gave private banking interests the license to create money out of nothing (through fractional reserve banking) and charge interests on that which was created out of nothing. In the end, the bankers win. Senator Aldrich and his cohorts have done their job well.