The Kaleidoscopic Romans

0:00I'm going to mention a few things I meant, a little fun things. It appears from research that the Egyptians invented the French kiss. Yes! Those of you who read my first chapter, there's a romantic male writing in there and he said, If I kiss her and her lips open, I am happy, even without beer. So, now, they may not have invented it, but at least they're the first to write about it. And the point of the book was that beer was a heavily taxed and monopolized, you know, operation of the government. And so, I happen to be a bit of a beer drinker. I really enjoy beer.

0:46And I recently discovered, I don't know if any of you are beer drinkers, but I was going out with one of my business friends and he took me to a Belgian restaurant. And he said that the best beer in the world is Belgian beer. And sure enough, it's really good stuff for those of you who like beer. And also, a lot of the best Belgian beer is not clear. But it's 14% of all. Pardon? The Lambique. Say? The Lambique. Yeah. You mean that? What are we talking about? Belgian. That's one of the Belgian ales. Oh, one of the Belgian ales. I don't remember the names, I remember the flavor, good stuff. But the reason the pear doesn't have the clarity, like our bears are so clear, is that all bears were that way for hundreds and hundreds of years, and it's only been in the last century that we've learned how to make them so they're perfectly clear.

1:45So you get one of the good Belgian bears and it isn't clear. So anyway, our Egyptian may have invented the French kiss and I thought that was a cute story. I'm happy even without beer. Another thing that's interesting about the ancient Egyptians, we didn't quite mention one of the students here did, and that is the pyramids. I had proposed in my book that the pyramids were not built by slaves and whips and all They were built by religious, devoted believers in the feral and they wanted him to have this wonderful place to go in the afterlife. And so it wasn't a land of oppressed workers and slave masters.

2:30And I think that more and more I've read now, they're beginning to come around to that. You actually wrote an article about that, how they found artifacts of a town, that you know that slaves wouldn't have had a town of that quality.

3:04and devoted Christian peasants and workers and things that devoted themselves and if you've been to Europe and you've seen some of those magnificent cathedrals, they're really stunning, you know, and very beautiful. So I think that's true. The other thing that I didn't mention and it brought around the decline and end of Egypt was the Pharaoh Akhenaten. You might remember him, he was the one god pharaoh, he was the pharaoh who believed in one god, the sun, and he proceeded to try and destroy the priesthood of Amun that had all of the multi-gods. And these were powerful guys, they say that one third of all the lands of Egypt were owned by the priests, and Herodotus writes about that, each priest had so much land.

3:55And so the land that went out and was taxed by the workers and the peasants, they never owned the land. It was either owned by the government or it was owned by the price. And so they basically paid the tax to farm these lands. And in my new second edition, at the end of the first chapter, there's a, it wasn't in my first edition, I hadn't found it yet. and it shows, it's quite interesting, it's a relief. I dug this up in old Egyptian paintings and it shows, it's from a tomb of Thebes, of one of the priests and it shows the workers bringing in their taxes.

4:42These are geese here and they're the usual kind of stiffness that you see in Egyptian writings. The thing Akhenaten did, he got so wrapped up in his belief in one god and the god of the sun that he set out to destroy the priesthood and to destroy the temples of the priesthood and that really put a tremendous strain on his treasury and on his wealth and he lost his connections to the tribute territories in Syria and Canaan which had paid pretty good taxes into Egypt and so tribute probably began elsewhere, but at least we know for sure that the Egyptians are operating a fairly advanced tribute system.

5:29And then we read the ambassador from Syria, he writes to the king and he said, you know, you've got to come out here, you haven't been here for a long time. And people have lost faith in the Pharaoh, because they believe the Pharaoh was God, you see, and they believe that the rain came from the Nile River. The Federal made the Nile go up into the sky, and across, and the rains came down, so he was a pretty powerful guy, but the poor guy writes home and he says, you've got to come out here, you don't have to bring out your troops, but you have to bring yourself out, it's sort of a dog and pony show, you know, so that people would see the Pope, so to speak, or whoever he was, and he didn't come because he was having too much of a battle on his hands, so he lost all the tribute territory that paid Subtantial Tax Wealth into the Egyptian Treasury

6:22and that is often thought of as the end of Egypt that by the time he died, the priest had turned around and he came roaring back and then they destroyed all his cities and rebuilt them and so it seems that the tax problem was pretty much what caused the end of Egypt one in the sense that he destroyed his tax wealth I'm trying to introduce the concept of one God. And it's interesting that it was in that region that the one God concept developed. It certainly developed in the biblical days. And they were monotheists, although it's interesting that the Muslims in their writing call the Christians polytheists.

7:11You know why they call them polytheists? Trinity. The Trinity, yeah, because of the Trinity, and if you read, and to make it pretty clear in there, there's only one God, and God is Allah, and there's not three in one, and so forth. Well, I thought you'd kind of like to know that, and also the thing that was interesting in ancient Egypt is the status of women was quite equal to the men, and you see some of those great reliefs where they saw Ramses and his queens, Mises and his queen, you know, they're the same size, and the women had a lot of clout in there, and of course later on they had the interesting bunch of Cleopatras, you know there were a lot of Cleopatras besides Elizabeth Taylor, she made pretty good, but there were quite a few of them through that period, that seemed to be the common name that they used on their daughters, was Cleopatra.

8:14Anyway, the other point I wanted to make sure I got clear was that I told you that Hanukkah was essentially a tax story and you can tell your Jewish friends that and to give you some ammunition, the taxes that the Greeks put on the Jews was one third and that was pretty high rate of tax and you've got to remember this is the gross income, this isn't the net income, this is one third of the crops and so forth and that was what they were really battling, and the little side story of the oil in the lamp was really not what it was all about. And then after they defeated the Greeks and threw them out of Jerusalem, they had a treaty, and under that treaty they got tremendous tax breaks.

9:03I mean, immunity from tax for a number of years, and taxes greatly reduced, and so forth. The other thing I wanted to mention, that in Aids in Israel throughout this entire period, you see a peace party and a war party, going all the way back to the battles against the Assyrians and Babylonians, there was always a kind of a peace party, and the prophets of Israel seemed to be those who were for peace. They would say, well, you know, kind of lay low and don't go to war against these guys. But then, of course, very often the king, he's the one that had to collect the taxes and give them over to the Assyrians.

9:49So we had this battle between a war party and a peace party. And I think it went all the way back to the David and Goliath story. David and Goliath, you know, it was a wonderful story because here's little David and he takes on the Goliath and he kills Goliath. And I think that became a bad lesson for the Jewish people, because they had this idea that they could, with a part with a heart that was pure, you know, a young boy with a slingshot, you know, could slay dragons, and I think that that explains to some degree why they appeared to be so damn foolish to take on the Assyrians and then get flattened by them, you know, I mean, literally. and the same thing when they took on the Babylonians and then Nebuchadnezzar comes down and he breaches the walls of Jerusalem and hauls them off into Babylon.

10:41The one time that it worked was the time of Hanukkah. They did defeat the Greeks and they did throw them out of Palestine or out of Jerusalem. The problem was that the Greeks were carrying on some wars in the East and they had greatly depleted their military forces and they didn't have the strength to protect their territory in Jerusalem and the Jews were able to throw them out. Now the story, as I say, keeps recurring in Jewish history and then the Romans come in and they're going to do it again. They had the revolt around 60 AD, and the Romans crushed them, and Titus was the great general who came down, and he had a Jewish girlfriend, and when he went back to Rome, he went back with all these relics from the temple, the big, huge cantalabras and things like that, and he's going to this famous arch that was built for his triumph.

11:42and the Jews of, put it mildly, they had lost, they had two other rebellions against the Romans and they lost those. They just, I think they just hung onto the David and Goliath story for situations where it didn't work. And maybe today we have a peace party and a war party, but Israel today seems to be able to manage the situation. situation. I think they'll be fighting for a long time, but I think that the Palestinians are kidding themselves. They're not going to drive the Jews out of their holy land. That's just ridiculous. But I do think you see that in history, and it does, of course, have its tax base. I wanted to mention the tyrants when the ladies are brought up.

12:29The Athens before the Democrats, before they became a democratic society. Because I think this is relevant today. The tyrants of Athens and the tyrants in the city-states, they maintain their control on society by two things. By gifts to the masses and by gigantic building programs. And they supported it with a 10% tax. and today I think because we are a pretty broad democracy there's a vast groups that want to sponge up the government that want gifts just like the tyrants did and they knew that if they made gifts to the masses they'd have the loyalty and support of the people and I think that's what we have today we're perfectly He was willing to make massive gifts, Democrats and Republicans, to various classes that he devotes, and I'm not so sure that it's always in the best interest, but that was the way the tyrants operated.

13:33And then one tyrant named Perseus Stratis, and Aristotle tells this story, he would travel around the countryside disguised and he would go into the towns and into the fields and he talked to the people and nobody would know who he was. So, Aristotle tells a story that he came into this one particular farmer and he was working away in his field and he says, you know, he said to her, how's it going? He says, well, he says, it's nothing but aches and pains and that's what Percistratus should give his 10% of.

14:41I think that they maintain their control over society, against the masses, people love it, you know, people love those, what did they call it, my wife was in Canada, and one of the funny areas up there is Newfoundland, they have a lot of Newfie jokes up there, and they even have black jokes up there too, but of course, do your hand to have them here, but anyway, the Newfies, they work during the summer in the fishing, and then they have nothing nd the money you do in the winter, so they apply and get welfare. And they call welfare the money with holes in it. That is, these cards, the checks, the money with the holes. Oh well. So Canada is an interesting country.

15:28I've lived there for a few years, and I've learned a lot of interesting things about them. First of all, the Canadians don't like Americans. That's the first thing you will learn if you live there. You up there and spend your money as a tourist, they love you, but they don't particularly like Americans. I learned that. I suddenly found out I was a pariah, almost, or something. But when they found out I was American by origin, they weren't too impressed with me. But it's just a big surprise, but that's essentially the way they are. Let me see what I wanted to mention also. Yeah, I wanted to mention, coming up to the The Romans, the revolt by Mithridates the Great.

16:14The Romans had introduced into the various provinces the tax farmers and they bid in order to collect the taxes in the region. And it was pretty sad, so sorry, because they had gone into these areas and they had made tax treaties, so that the various provincial areas had a treaty with Rome as to how much tax. Well, the Roman government decided that, gee, we can do better with tax farmers, and so they repudiated their treaties and proceeded to send in the tax farmers. It really made everybody pretty unhappy with the situation. The United States has done that, believe it or not. And Cicero wrote at this time and he just condemned the Senate in the strongest possible words for doing this. Even pirates have a better sense of obligation than you people have. And it was because of the seething rebellion over the taxes collected by the tax farmers, and you remember yesterday I talked about the lady from the island of coasts And so at 88 B.C., on one day,

17:54They struck, and they killed 80,000 Roman tax collectors in one day. Well, of course, the interesting thing about the public county is that these were the world's first stocks. And I think all the investors of the Romans invested in the public county corporation because this is where the money was. Well, could you imagine how those stocks collapsed? I know we don't have a record of this, but I just know that 1929 was nothing compared when the news came out that they wiped out the tax farmers and they'd seized all these territories and Mithridates the Great was the man of the hour for a while. The Senate got together and they obviously couldn't tolerate this and they sent a great There was a general named Sulla, and he was the one that preceded Caesar and Pompey, and Sulla went into here and he beat these people, and he put them down, and he ordered all of them to go to Ephesus.

19:00You might remember Paul wrote an epistle to Ephesus of Ephesians, and he said, I want you guys to show up there, I'm going to tell you what I'm going to do. Well, he said, we Romans aren't really bad guys, that's the only word. He said, all I want from you, besides your obedience in the future, I want all the taxes now for five years, now, and then I want you to pay for all the costs of my military operations now. So, he, boy, he was a tough egg, but what he introduced in the world of taxes that has application today, he appointed special agents to collect the revenue, not in the normal tax agents, you know, not public counties, but special agents endowed with special powers to collect, to use whips and scourges or whatever they needed.

20:08Now, the reason that caught my attention is because we have special agents in the Internal Revenue Service. Now, these aren't the ordinary guys. They don't just go around with a little car. They got badges and guns, and they know how to scare the ______ out of you. They really do. They're a tough breed of cats. I ran into them once many years ago, and it was really a revelation to me as to how How intimidating these mice can be, and I have since talked to other people that have had some trouble with them, and they've agreed that they must get training on how to ask for your name. You know, they ask for your name, they ask for your passport number, which you don't know, but it's very intimidating, and they have a way of getting their way.

21:03They are special agents of the Internal Revenue Service. They are not the regular tax auditors. They're not part of the tax system. They're special agents. Their job is not to collect money, but to lock people up. And I saw it here with Mithridates and with Sulla, when Sulla decided to come down with his tremendous tax collection upon the defeated cities that rebelled and organized. Special word was, special agents, if you translate the Greek, so we've had them ever since. They're part of the system and I suppose that they're essentially out to arrest people and throw them in jail.

21:52I don't know how good they are at it, but I know they scare the hell out of people. There is one other interesting story that comes from the same period. One of the cities that was loyal to Rome during the time of the Mephidates and they refused was to join in with the rebellion and the king was really a good, faithful Roman provincial ruler. He made up a will, and I would say if you were to talk about wills in the history of the world, this was the worst will that had ever been produced for mankind.

22:46He made up a will in which, out of his appreciation for the Romans and for the prosperity they brought to them and so forth, he gave his kingdom to the Roman Senate. And the Roman Senate now owned it. And they proceeded, well now we can tax it, because previously he had got a tax immunity because of his loyalty to the Romans. and so now they turned around and came hammering back on these people with heavy taxes that would be collected and would be sent to the Roman Senate. We don't know. We know there was a rebellion that followed. We don't know much about it. It's one of those historic events that disappeared. There's two questions I would like to know. What became of the lawyer who wrote the will?

23:34Well, I mean, he should have realized what he was doing, you know, they lost all their tax immunity, they lost all their loyalty, and now they just become a tax asset of the Roman Senate. But that's another one of the little stories that's always intriguing.

24:04What year was that?

24:13Did you hear the name of the city?

24:34In the present year, history of taxes running from the earliest times up to the present day, what kind of a computer did you use? And he says, I don't have a computer. I didn't at that time. And I said, no, I just remembered it all. I mean, I knew where the stuff was, but I basically put it together from memory. But I was thinking of a saying that Cicero made. He was irresistible among the great lawyers of the Roman period and he was very much against Julius Caesar and the thrust for power and the destruction of the Roman Senate. Because the Roman Senate is a period we call the Republic of Rome and it was destroyed by Julius Caesar in that period.

25:20Then we have the empire that follows with Caesar Augustus. But he wrote something, and fortunately we have a number of his wonderful writings, and he wrote something, I thought that it went like this, he said, this is when the Civil War had hit and Mark Anthony was battling away, he said, He said, surely we are being punished for having let one man have so much power and do so much harm. And it was an interesting question. I think there's some truth in that, you know, throughout history. Look at how much Germany suffered because of Hitler. I mean, God and the world suffered.

26:05But surely we were punished for having given this one man. And then he goes on to say that, he said, few have inherited his fortune, but many have inherited his ambition, and that pretty well set the stage for the end of the Roman Republic. The Roman Republic ended, as you know, from Augustus, and that was a pretty good period until, of course, he died, and then they got all these terrible emperors that came, and there was a revolving door as they were being assassinated, and new ones were coming. And then if some of you liked the thing in my book where I showed the value of the denarius, and how it went from maybe one or two denariuses for a book, a bushel of wheat, to 300,000 for a bushel of wheat in a few hundred years.

26:59In this book here on the American tax, I draw a comparison with the depreciation of our money today and the depreciation of the denarius under the Romans. There's a 70-year period where the denarius came way down, and there's the same 70-year period with our money. It's pretty ridiculous what's become of our money, because I remember when I was young and we had silver money, and my mother told me when she was a little girl, she's still alive at 94, but how her father gave her a $5 gold piece.

27:48And those were the days when money was gold and silver, and you know, that was the system. If you look at the value of a nickel, then, you know, you go back to the time we went off the gold standard and silver standard, to the value of a five dollar today, pretty much the same. You know, a nickel in those days was worth five bucks today. It's just amazing. I bought a pound of butter, and I remember when my mother used to send me down to the store to buy butter and bread, and it was just a few little coins, that's all I needed, and that was it. And my wife still reminds me, some years ago, and I guess I never got out of the mindset of the day when money had value, and I needed a grinder for my little workshop that I have.

28:43So I gave her five bucks to go buy a grinder. She came back and she says, $125 is cheap as well. I can find, what do you mean five bucks? Well, there was such a time, I know, you could buy a brand new car in that days. I used to listen to the baseball, you know, I was a baseball fan, as most kids were, and I used to listen to, they would kind of reproduce these games, the baseball games, you know, with the majors, they would sort of manufacture the story of, you know, who hit this and who

29:52The other thing that happened during this Roman period, and I want to finish with that, is that we had the burning of the tax records, and there's a picture, a lot of big pictures, and even in both volumes here, it shows the burning of the tax records at the Forum in Rome. in Rome. And what happened is that the big, what we call the landowners became the basis of the nobility of the Middle Ages. They would build up the big tax debt that they wouldn't pay and so then they'd lobby through the Roman Senate in order to burn all the tax records.

30:45And of course, that was a pretty good idea because, you know, burn tax records are like dead men. No Tales So they have the wonderful pictures and etchings and things from this period show them burning the tax records in the forum. That of course didn't help because the problem was that when the vandals and the barbarians came down, the Rome didn't have the military force to protect itself because the tax evaders Well, that kind of brings us up where we are today, just a few little highlights I missed. I did want to start with Switzerland.

31:35I like Switzerland because I've had some interesting experiences there. One of the most interesting I had was, you might remember some years ago, when Amelda Marcos of the Philippines, she was being charged with having raped the Treasury of the Philippines. And of course, the United States government got involved in it, and they indicted her. The world business, it was ours, I don't know, because it wasn't, they indicted her for stealing all the money from the Philippine treasury, and they indicted a guy named Khashoggi, and Khashoggi was one of the richest men in the world, and of course, Khashoggi was in Switzerland, and so they sent off the request for extradition to Switzerland, and there was quite an attempt to block it, and when I was over there, I had lunch with this guy, a nice fellow, and he was telling me, he says, we have a real problem with Kashog, you know, this was a government lawyer that was dealing with the extradition problem, he says, the problem is that you Americans make everything criminal.

32:57And they couldn't make out a crime in Switzerland for what they alleged that Mr. Khashoggi and all that had done and it was hard for them. They wanted to be a good international country and honor the extradition of criminals but this wasn't criminal by Swiss law. But anyway In the end of the story, they finally threw in the towel, they extradited Khashoggi, they sent him back to the state for trial, and he was acquitted, and so was she acquitted, and so the American taxpayer spent a lot of money and gave up with a mouthful of feathers. But I've always remembered his comment, you Americans make everything criminal, and I think there's a sad truth in that.

33:45You look at the laws on the books, I never knew a professor I had years ago, and he said the only way you can keep from not breaking the law is to stay in bed all day. So there might be some truth in that. The Swiss, the interesting story is told of an American in Bern, Switzerland, and he's taking a little tour bus, going around the town, and what not this, what not that. And one of the Americans, he's talking about the Swiss president, and so he says, he said, what's the name of the Swiss president? And the driver says, gee, I don't know. I don't know his name. And so he stopped the bus, he goes in and, yeah, he tears somebody off.

34:34And the interesting thing about the Swiss president is that he rides the work every The Swiss formed their new constitution back in 1848, and they did not want an American president type concept, this personal preeminence, this guy up on the White House, they just wanted him to be just an ordinary citizen, and that is true, and that's why he rides the work on the sweet car every day. And I always said, wouldn't it be great if an American president rode to work on a streetcar? You know, we'd probably have better government. So that's the first thing about the Swiss.

35:19They also have a long tradition of financial privacy. It goes back to the Middle Ages, it's a Germanic law. And so when people put their money in Swiss banks and the information is protected, They do it because they grant that privacy protection to themselves, and it applies to anybody who uses their banks. And so now we have all this uproar about Swiss banking secrecy, and it turned out that it was such a good deal that about 23 countries around the world adopted banking secrecy. Banking Secrecy, the Bahamas, the Caymans, Panama, the Turks and Caicos around here, Barbados has some, Curaçao, the Dutch Antilles Banking Secrecy, you go over into the Far East, you have Hong Kong and Singapore, the New Hebrides, and there's a bunch of islands out there that have banking secrecy, because it was a good deal, you had jobs for the society and it brought in money and it was a good idea, then in Europe of course we had the Channel Islands with Switzerland to some degree, but Switzerland wasn't really that good of

36:37a tax haven, but the Jersey and Guernsey and the Isle of Man, Gibraltar, Cyprus, one of the provinces actually in Yugoslavia is a tax haven. So there's this great growth of tax havens following the Swiss example. The problem with the Swift example is that they charge taxes on interest on the bank accounts. Whereas if you went to the Cayman Islands, you didn't pay any taxes. In fact, if you go to the United States, you don't pay any taxes. Foreigners can bring their investments into America and they pay no interest, they pay no capital gains. So, that's why I think if I were to give our friend, the Democratic head in the House, in the Ways and Means Committee, some credit, he said, Mr. Adams, he said, Don't we attack saving? Yes, we are the foreigners. And same is true with all the countries, England, the Netherlands, Canada.

37:41If you're a foreigner, you can put your money in those banks and they don't charge you any tax on the interest. And they don't charge you any capital gains on your security account. But now things have gotten a little different. One of the most interesting things of late is the OECD, The C, which is a kind of a super organization out of Europe, called the Organization for Economic çünkü Control and Development or something like that. Pardon? I think it's cooperation. Yeah, economic cooperation and development. That's right? What does the C mean? Economic cooperation. Okay. Economic cooperation. Yeah, it's obvious. Anyway, what they've done is they have organized an attempt but an embargo on any country that doesn't open up its banking laws for inquiry from the rest of the OECD.

38:36So it's a rather interesting, bold, daring concept. Well, they presented a problem with the Swiss because the Swiss can't do that. And the reason the Swiss can't do that is because they're the world's best, most stable democracy. They are a democracy. And those laws that protect banking have to be referred to the people for a vote. The Swiss government can't make a deal on this. They can't tell the banks to do it. And the Swiss people ain't gonna vote for it. So that's put a bit of a damper on their program. I've always thought it was very interesting and fascinating because it's like I say, it's a deep tradition and in my studies and experience I read into a couple of examples and it's quite interesting.

39:27I think one of the best movies that Steve McQueen ever made was with Faye Dunaway called The Thomas Crown Affair. Now there's a later version but it wasn't any as good. Steve, apparently, Steve McQueen really liked that role and in the role he's a tycoon who's bored with life, he's making fortunes in the market but he's just kind of bored, wants something, a little zest in his life so he concocts a scheme where he is able to entice some people but he keeps himself unknown, it's a great movie, he keeps himself unknown and proceeds to start robbing banks and does a great job and eventually gets all the loot and it's dropped off in the cemetery and then secretly he comes up and picks up the suitcases full of cash and then ends up on a plane, on a Swiss airplane for Geneva.

40:27And the next scene is he's in Geneva, and he walks in, and he gives a numbered account, and he brings all the money, and they check it all, and everything's fine, they've got these funny smirks on their faces, they're taking all this cash, and he leaves. And then he goes back, and he does it again, and of course a couple of scenes where he laughs, because he's just enjoying himself, and now he really got something. And Faye Dunaway is really trying to nail him because she's an insurance investigator and her company has to pay for all the money he's stolen. And she's just about to get to him and he sets up his last heist, it's a great movie, his last heist in which they're really getting in on him and, of course, he comes around and he has this guy drop off the suitcase, supposedly full of money, and they come jumping In the meantime, she's sitting there, and she hears an airplane flying over in a Swiss

41:38air. And he's sitting there, and a Swiss stewardess with a little bit of a Swiss accent hands him a cocktail, and that basically is where it ends. That little story has been attempted by some bank robbers. There were some bank robbers that made the American Express robbery out of Chicago. And they got all these, just like he did, they got small bills, and they then went down to Florida and they got on a chartered plane and flew over to the Cayman Islands, and so I was there, but I knew some of the bankers, and they went in, and they had this cash, and they got a referral name from a law firm in Boston, and no problem.

42:26So they went around and made these deposits of cash in a number of the banks in the Cayman Islands. And then, of course, they were sitting there, and eventually the cops, the FBI, traced them, and then went down there on their own chartered plane and the CID and Cayman Islands arrested them for bringing in stolen money, which was a crime, and they turned the guys over to the FBI and the FBI flew them back to the United States. They complained that they hadn't been extradited properly, but the judge wasn't too impressed with the argument. The point is that they believe that. They believe that you can take hot money, stolen money, you go to a tax haven, go to Switzerland, and deposit it in a secret account, and you're away.

43:17It never worked that. Yes? I can imagine that these offshore banks don't have deposit insurance like we do here. No, no, no. I was in the Cayman Islands when the bank set up by Jean Doucet from Montreal broke, and I remember he went bankrupt, and a lot of people lost a lot of money. He took in money and it was sort of almost like a Ponzi scheme. Ponzi is where you take the money that you get and you pay it out as earnings and interest on other people's money and so then people think, as long as the system works like that.

44:02On those banks down there, what documentation, how can you make a judgment as to, well, is this bank going to be sound 10 years from now? Can you find that out? Well, what you do, you go to major international banks. Citibank has a branch there, Royal Bank of Canada, Bank of Nova Scotia. The Germans had banks there. They're very solid banks to the island. They really are. They're quite solid. So you don't have to worry particularly about it. You don't have to worry about the Royal Bank of Canada, or the Canadian Imperial Bank of Commerce, or Barclays, the biggest bank in England.

44:49So the Dresdor Bank is there. So the major banks of the world have gotten there because that's where the money is. And people are coming in with their money, and one of the things they're coming in with is to avoid taxes. The other thing they're coming in to avoid is exchange controls from countries that have that. But I always thought that was an interesting story. And in getting back to real stories, the Howard Hughes, Clifford Irving book. There's a guy named Clifford Irving who supposedly, I mean, he claims that he wrote an autobiography The History of Howard Hughes And he went to McGraw Hill in New York and sold them the manuscript and they gave him a check for $750,000 payable to H.R. Hughes Hughes' name was Howard Raymond Hughes He then gives it to his wife Irving, Edith was her name And Edith goes over to a Swiss bank in Zurich, identifies herself and got some phony papers and endorse the check made out to H.R. Hughes.

45:57In the meantime, of course, there's quite a bit of denials by Howard Hughes that this is his autobiography. He never met with this guy, and pretty soon, I guess, it begins to soak in, maybe so, but McGraw-Hill had just given up $750,000 a deposit made out to Mr. Hughes. Professor Hughes, so they then contacted Switzerland because the check came through being cashed and the Swiss went to the bank and interviewed the teller and it turned out that H.R. Hughes was a lady. They kind of blew everything. They immediately opened up the banking completely.

46:44The banking secrety did not protect crime and so they opened that up immediately and The result was that they soon arrested the two of them, but I guess, you see, they thought they'd get away with it. They thought they could go in, forge somebody's name on a check, cash it, and it's in the Swiss bank, and now we're safe. So banking secrecy, which is one of Swiss's great contributions to the world, is non-absolute, and it just doesn't work. and it's a wonder that Hollywood got it wrong. Maybe they just think it's a cute story, but I know those guys that did the Chicago heist, it was the American Sprint Bank, and took it down to the Cayman Islands, just almost followed that movie completely.

47:33Small bills, they picked them up, they flew over there, they put them in the banks. The other problem was that they had a tough time if ever getting the money out of there, believe it or not. From what I understand, they didn't follow through the way they should have, and a lot of the money just disappeared. They shouldn't have. They should have been able to go to the court. They got a court order, but they didn't do it. The Theory of Bank Secrecy is simply that it should be an English-American law, we shouldn't have to have the Swiss, because if we go back to the Middle Ages, there was the saying that a man's castle is beyond the surveillance of the king.

48:19That's a fundamental rule, and it showed up in Nixon's day when they went in and got the records of a psychiatrist for the guy who had leaked the Pentagon papers, and the guy in the Senate, that old guy that was investigating, was he a senator or something? Anyway, Erwin was his Anyway, he asked about it to Nixon's domestic affairs czar, Erich Mann, and he said, well, what about the ancient principle of man's castle beyond the surveillance of the king? And Erich Mann said, oh, times have changed. He's right. Times have changed.

49:06But the theory behind that was a tax protection, that if the king knew what was in your treasury, You could be sure that he's trying to figure out some way to get it. And so under English law, a man's castle was beyond the reliance of the king. There was this bank secrecy, which we should have, but we don't have it anymore. Everything you do in the banking is photographed, sent off to the government if they want it. I guess the answer, this was a famous case that was out of California where they challenged this law, Congress passed this law, we had to photograph everything that went through your bank account and then store it for the government to want to watch, and that law is still there, The Federal Reserve, but it went to the Supreme Court, and they upheld it.

50:10I guess, who's the current Chief Justice on the Supreme Court? Yeah, he wrote the majority opinion and said, oh, it's okay, you know, he says, nothing wrong with that. He even said in there that something about a land of Swiss cheese or something in his opinion, meaning, I guess, Swiss cheese. But the best thing that came out of that was a dissenting opinion written by Judge Douglas. You know, Douglas was sometimes called a great dissenter. And in it he said that he was not willing to believe that every American was a crook. And he thought that according to the majority opinion, it was useful in criminal investigations.

50:58And he said it would be useful to record all of your telephone conversations. It would be useful to record all of your purchases at a hardware store, because you might be buying burglar equipment. That he did not feel was sufficient justification to photograph everything going through your bank account. And of course he lost, and that became the American law, they photograph everything, and of course with computers, you know, now it's just amazing what they can gather. And your ATM cards. Yeah, well, we don't have any such thing as privacy in our financial affairs, and maybe someday we'll go back to the old mattress thing, when you put all your money in your What about the Homeland Security Act?

52:12What was the name of the California case?

52:42It was a wonderful decision by Joseph Douglas. I always thought he really had a lot of guts, particularly when he married all those young girls. Did you miss that? Did you know that? He would show up with some sweet little thing and it was just amazing. He was 80, 85, he was still hanging in there. Douglas, what a very young kid. He married a very young wife and he had a child.

53:40You were just impressed by the fact that he still threw it, right? Well, I tell you, I have some old classmates that are hanging in there pretty good. They're females. I'm trying to think of the name of the one. I'll get it for you. It is in here somewhere. I would probably be under Douglas, yeah. You know, the greatest thing to a writer is to have a good index.

54:21David Brinkley wrote a book, yeah, you're entitled to my opinion or something, and really a nice book on Washington and no index. I wrote him back and I says, 100 years from now, historians will never use your book because you have no index. And I said, if you have another printing of that thing, You should have another... Now you've got me puzzled.

54:56Here it is. It's on page 401, 402. It looked like I didn't give the citation. You know, Douglas was not willing to believe that everybody in the country was a crook. I love that saying of his. It's too bad that sometimes, you see, sometimes the dissenting opinions become law and that's why we studied them in law school, like back in World War I when they had some terrible laws against anybody complaining about the war and there was a guy named Abram that would demonstrate to New York distributing a pamphlet complaining about World War I and they arrested him and they charged him under some horrible law and they gave him 20 years in the pan for writing this pamphlet This pamphlet, twenty years ago. And it turned out when Holmes and Justice Brandeis wrote the dissent there, and Holmes wrote it, and he said that Abrams had just as much right to publish and distribute this pamphlet as the United States has the right to distribute the Constitution.

56:22It's interesting, a wonderful phrase. Well, we've since believed in that, because if we had not changed the law, then when Vietnam came along, we never had enough jails to put everybody in it, because so much, you know, protest against it. So we do sometimes see dissenting opinions become, you know, become the law. Anyway, so you can tell I like the Swiss. They're certainly worth the study, and it's going to be interesting to see how they're going to handle this OECD problem. I don't think they're through with it yet, but I imagine they'll figure something out. If we were to move on a little bit to Spain, and I'd like to tell the story of Elizabeth I, I tell a story of where there was a Spanish silver galleon loaded with silver that was coming up through the English Channel and the Dutch raiders were chasing it and trying to capture it.

57:37And so, to prevent themselves from being captured, the Spanish galleon made it to an English port and it's loaded with silver, it's off to the Duke of Alba, who was running the Spanish Netherlands, and Elizabeth, kind of short of cash, so she takes it. And the Emperor Philip of Spain is enraged that this upstart Queen would steal his silver, I mean a whole galleon full of this stuff. And so Elizabeth wrote back and she says, well I understand there's some dispute about this, that this really belongs to some genuine bankers.

58:26So I'll just hold on to it, take it as a loan, until a real owner shows up. So I think that might have been the basis of a Spanish armada. I mean that this woman could do this, could steal my whole galley and fill it with silver, whereas she's supposed to give protection to ships, you know, from the high seas that are coming into her ports and so forth. And here she's stealing all my money. And dear old Elizabeth, she was a tough cookie. The thing about Elizabeth is also great. She was able to keep England out of wars. She didn't want English men and English boys to end up in some grave and some battlefield in Europe.

59:12So she managed to help finance the Dutch in their struggles. She even sent money to the French, as much as the British and the French hated each other. I think that's one of the reasons they loved her, besides the fact that she didn't burden them with a lot of heavy taxes. I find that her stealing the galleon has got to be one of the great stories of all time. And I guess if we had been in the holds of where the Spanish Emperor was, he probably just went out of his shoes, you know, when you heard about what she had said, that it belonged to some Genoa bankers.

59:57Genoa, had they been known as the world bankers for years? Were Jews? No, Genoa. Genoa. Yeah, Genoa is a famous banking community. You probably know. Yeah, it was famous. I've written a whole bunch of history about it, but I keep running across it and I've never really seen anything about it. Well, one of the things also, when we discussed a little bit about the Jews and how they had such a terrible time, I think it was the Jews, and I did some research on this, that invented commercial paper. Paper, we have today, checks, things like that, because whenever being hammered on by the, and all of their wealth being stolen by the various monarchs in Europe, they were able to issue paper and send it on down someplace where their wealth was or to somebody else.

1:00:52Maybe they'd send it to Paris, but the wealth was down in Spain or Italy or probably Italy, And this would be called the Bill of Exchange. They were the first international bankers in the world. Yeah, banking became paper banking instead of just a sack of money. And you could then manage that by moving it around by the Bill of Exchange. The origin of the Bill of Exchange came from Genoa, as a matter of fact, came from the banks and that. And that way I think the Jews were able to preserve and protect their wealth, of the World. Even though they themselves were shipped off and walked it all. My wife was interesting, she was a young girl, she was in Russia, and the Germans came when she was 12 and they packed her up and shipped her to Stuttgart where they put her in one of these slave labor camps.

1:01:48And after the war she went to work, she didn't like the DP camps, they said they were just lot of fighting and paying cards and getting drunk and all that stuff, so she found a job in working as a cook, although she was only 15, and it was an interesting story. She went into this, a guy once said in Kreminger, and he was appointed by the American military authorities to be the governor of the area, of the shoot gun area, where they make the Porsches and stuff. And anyway, the lady who was his wife was a lawyer, and during the war she made regular trips in the Switzerland, bringing in Jewish wealth and depositing in Swiss banks.

1:02:39And they never caught her, she was very clever, she would have a box of chocolates with a and the false bottom and she'd be eating the chocolates and so forth and so they'd church and car and you know the Germans would and they never, never caught her. And after the war and apparently she had handled it pretty well because she probably when she set up these bank accounts for the Jews she probably put in conditional fares for people to take it if something happened to them and something usually did, they didn't last, they were often killed. And then she started getting all kinds of gifts and things from New York, from the families of these Jewish people that she had taken their wealth off of Switzerland.

1:03:29And that brings us into Swiss banking because at that particular time there were not any laws against privacy or for privacy, it was just a tradition in Switzerland, it was just understood. So they started passing laws, the Swiss did, punishing people for trying to break Swiss bank secrecy because the Germans would send in some of their other agents just to try to disguise and try to discover, maybe bribe and get it. And so that's when the numbered account came out. So you could go into a clerk and you couldn't get through the numbered account to find out who was behind the account, only the bank manager and his assistant knew who it really was. So that's how the numbered account began.

1:04:17And one of the interesting stories that I like is a guy named Stanley Lill. He was the British, I guess you'd call him, inspector of exchange controls in the 1970s. And the English people, because of exchange controls and taxes were horribly high before Margaret Thatcher got in, were shipping their money off to Switzerland in one form or another, and they had Swiss accounts. So Stanley Little, again, he's a British, you know, a British civil servant. He goes into Switzerland and tries to bribe his way to get information on English people, British people, using the Swiss banks to avoid tax. And the Swiss got onto it, and they ordered him out of the country, and they sent a notice to the British government that if he ever sets foot in Switzerland again, he'd be arrested.

1:05:14Well, we have a saying that, going back to Spain, that the sun never sets, the sun never ever sits on the dominion of Spain, and at the slightest movement of that nation, the whole world trembles. We don't think of Spain today as that, but it was a tremendously powerful country. They owned probably everything inside.

1:05:59They even owned Mexico and all that region, the King California in the west. They also owned Florida. They owned all of South America, Central America, Central Brazil, and the Portuguese,

1:06:42All the gold and silver that was coming from the New World, they had the Royal Fifth. So they got a 20% tax on the silver and gold, and of course some of the dyes and some of the wealth that came out of the New World. The taxes were heavy, and whenever taxes are heavy, human ingenuity introduces itself. They had a massive system of smuggling on the Atlantic. It was a massive slugging. As the gold and silver and the various products, there were certain dyes that came from the New World. They would send, they would close, like in Panama, for example, because a lot of the stuff came out of the Incas and came up Panama and across the Isthmus and then they loaded on the galleons and they headed off to the New World.

1:07:35But they would close the ship's register, and then after the register was closed, then they'd load all the stuff on, you know, all the silver and gold and everything they could think of. Then as they came across the Atlantic into Spain, there would be little special ports that were not the main ports of entry. And they'd go into those ports and unload all the stuff that was not on the register, then they'd go up to the main Spanish ports, and unloaded. So there was a massive system of smuggling, probably the most massive smuggling system I've ever known. But that was just the beginning, because the taxes were so high, people wanted to get off from under them. And so one of the ways you got off from under them was you came to the New World.

1:08:21And there's one thing in my book where in one month there were 6,000 Spaniards that left Spain because they could no longer live there because of the tax system. They went to the New World, and years later when Bismarck was putting Germany together, and they were talking about Germany's colonies, and Germany had a few colonies, we swiped from them during the Treaty of Versailles, but Bismarck was against Germany having foreign colonies because we might end up being like Spain and sending our best blood overseas. and that was Bismarck a hundred and fifty years ago. So anyway, so a lot of them left the New World, left for the New World and there, of course, you know, a lot of them did very well.

1:09:09A lot of them then became nobles and I guess it didn't matter what you were, as long as you were noble, you didn't have to pay taxes. Then a lot of them joined the civil service of the government and apparently the civil service was enormous. I think one of the statements is that one man could do what 20 civil servants were doing because he just wanted to get out of the tax system. And then if you couldn't get out of that, you joined the gypsies. That was your last... So Spain's terrible decline from being the most... the biggest and at the time most powerful nation on earth was just one massive tax story of trying to tax too much because of this al-Qabbalah. They tried to introduce the al-Qabbalah after they lost...

1:09:56The people were disappearing, they didn't have any money, then the Spanish had a study made and in the study they said, well look at all the provinces we've got, they're not paying a dime, Catalonia, they're not paying any money, Basque is not paying any money, Portugal, so they decided that they tax them, well they set off revolts, and they had some terrible revolts particularly in the Spanish provinces, so much so that while they were fighting the revolts at home, The British and the Dutch and the French were stealing their empire overseas. So the result was that they didn't have the resources. Jamaica, which was British, was really Spanish. In fact, if you go near Kingston, what is the capital there?

1:10:47Kingston, I guess I'm right. You don't go too far from there, there's a place called Spanish Town. And Spanish Town was the old Spanish capital of Jamaica. But of course Cromwell, he threw him out, and of course, he also threw him out of the Cayman Islands, but of course that wasn't anything to speak about. But it proceeded that Spain's provinces overseas, and Barbican, easy pickings for the world. And when America had the Spanish-American War, most of the Europeans says it wasn't right, it wasn't fair. He says that they couldn't defend against anybody, and it wasn't right to have stolen Cuba and Guam and all those things that you did.

1:11:40And it was easy picking, you know, again the tragedy was it was too easy. And we got a bad impression of ourselves, or a good impression of ourselves, that we could lick anybody. And so World War I, we were going to go in there and the angst would come and stuff. And we only lost 110,000 killed over there in one year, so it wasn't a very successful war from that standpoint. So Spain became easy pickings, and I guess the provinces, you see, their feeling why they didn't want to pay the al-Qabbalah was that We're in the empire, that's fine. We'll supply taxes for the protection of Castile, of Spain, but we're not going to produce taxes like you guys are paying.

1:12:26And so that's what set off some of these revolts. One of the interesting revolts, what's still in the census today, is the Basque revolt. Up into the, you know, there's still the Basque separatists, you know, still raising hell all the time. One of the things that was interesting is that they sent up a taxman to collect taxes for the government of Spain and its Castile, and the people were mad as hell, and they seized the guy, and they're going to put him to death. And they did put him to death, but before that he begged to be able to have his last rites, Charles I was the Emperor of Spain, he was like George Bush, he didn't want to be forgiven in the next world for the taxes that he was burdening upon him, that's how mad they were, can you imagine they denied him his last rights, because they didn't want him to be forgiven in the next world for the taxes that he was burdening upon him, that was one of the great stories, well what did they do, well Charles I was the Emperor of Spain, he was like George Bush,

1:13:34He said, no new taxes, and he promised the Spanish people there would be no new taxes. But he tripled the collection of taxes. Now guess how he did that? He did it by turning the screw on taxpayers. Turning the screw, you put your thumb in a deal and you turn the screw and apparently The Theory of Money works pretty well to get people to respond. So he turned the screw and tripled the amount of revenue. So that was his no new taxes. I guess our friend Bush didn't resort to that, but it is true that when government wants taxes they can hammer down pretty hard on taxpayers.

1:14:29And when the rates are too high, then people are going to rebel, and that's a fundamental rule of life throughout all of history. And Spain is a marvelous example. Here was this great empire that disappeared and collapsed, all because of their tax system. And Queen Isabella, for example, in her will, she requested that the al-Qabbalah be abolished. and the great Cardinal Jimenez, he also, same thing, he was the Cardinal for the area and he'd get rid of the alcobala, but the reason they didn't get rid of the alcobala is they're very productive of revenue. If you want to know why we don't get rid of the income tax, it's because it's very productive of revenue. And as we will learn, and maybe I'll talk about it this afternoon, the income tax was so productive when it was introduced that we'd never been able to let go of it.

1:15:28When it was reintroduced in England, and I'll get to this some other time, at 3%, it was going to be 3% for three years. And that would bring up the British Treasury and get them out of hawk and so forth. That would be the end of it and never ever got rid of it because it always produced so much more revenue than anybody ever expected. And if you get a tax that's productive of revenue, you're not going to get rid of it. Anyway, I'm going to leave you with a wonderful Spanish and with Elizabeth Staley in their ships. Oh yeah, one other thing. We're going to go into the Netherlands. And the Dutch people have a wonderful attachment to their history, their tax history.

1:16:15And the Netherlands, you talk to any Dutch person and you mention the 10th penny. And that is how the Netherlands came about. Because the Spanish tried to introduce the 10th penny in Alcabala, but they called it the 10th penny. And that set off the rebellion of the Dutch, and that rebellion ultimately led to their independence. They rebelled it for 80 years, and I was talking to one of my Dutch friends about it, and he said, yeah, he remembered when he was a little boy in school, and we had this nursery rhyme, and it says, Peter Heim Admiral, his name is short, his deeds are long, he captured the silver fleet, which was, of course, the Spanish.

1:17:05Anyway, anybody wants to talk about anything? Yeah. Can you perhaps speculate, just a wild guess, I had a chance to go to Jackson for this Dresden exhibit, Augustus the Strong, you know, in the 1670s. Do you have any idea how much of a tax he had to put on the populace to produce the incredible wealth in the palaces and all this stuff? Well, it's sort of like, we were going to talk about Louis XIV when they were talking about taxes and he said that, and he was concerned about revolting and so forth, Louis said, everything is mine. So when I tax, I'm only taking what is mine.

1:18:07In a sense, don't laugh. The United States government considers the same thing. If you're an American citizen, they own you. Now, the Canadians don't own you, because if you leave Canada, the taxes end. Same thing is true with the Dutch, same thing is true with the French, same thing is true with the English, and the Polish, and the Swiss, and the Germans, and the Italians, and the Spanish. Only the Americans consider that if you're a citizen, they own you, so that no matter where you are, or what you acquire, they're entitled to their take. And theoretically, they can take it all if they want to, where these other countries and all of the Western countries recognize that they don't own you.

1:18:56And once you cease to be a resident, then you have no obligation to pay taxes. That's kind of a frightening thing to you guys. It's very possible to be an American citizen and to never have set foot in the United States in your life. And we had a case in Canada recently, and it's kind of a cute case, in which a man and wife, they're immigrating to Canada, and when they got to Chicago, she delivered a child, and they just didn't get to Canada, so he's born in the United States. This is a long time ago. They moved to Canada, the guy becomes filthy rich, and he dies.

1:19:41The United States, he obviously had some bank accounts, maybe stock accounts, because of his enormous wealth, and when the executives went to collect on the wealth, pick it up, you have to file a federal state tax return, it's called a 706, and in the 706, where were you born? Born in Chicago. Oh, how nice. You're an American citizen. Oh, no, he came to Canada. He was only there for two days. Didn't matter. He was born in the United States. He's an American citizen. We want a tax as a state. and they went up and they got the records and there was millions of dollars involved and man, they then notified the executor, you better file a 706 if you don't, and then when you sent it to the United States, we're going to arrest you, and these were, you know, prominent lawyers and accountants in Toronto, well of course, the itch that hit the ANFA up in Canada, I have to use a big Latin word, it went to the House of Commons and went to the government and boy there was a,

1:20:50They even went to me, as a matter of fact, and my tax experiences and so forth. The American government finally backed off. They finally backed off. Even though he had never renounced his American citizenship, he just had become a Canadian. He probably didn't know who he was. Well, he didn't know if he was the problem. But if he had any brains, of course, he would have taken everything out of the United States in the United States, or operated through COVID-19 corporations, there's other things he could have done, but it does show you, it does show you an aspect of America's tax system that is so unique, that if, and then if you renounce your citizenship under the current rules, they won't let you in, which is another question, so it's a, it's the top-rated cats, and the Congress isn't going to ever change that, and you know, Well, didn't they repeal the death tax now, the state tax?

1:22:06It's repealed, sort of, but then it's going to maybe come back. If the Democrats get in, it'll be back. We'll never get to 2010 without a change. Yeah, I think you'll never see the end of it. Now, Canada repealed the death tax, and many countries have repealed it. You figure out, you paid your taxes once anyway, why should they tax you a second time? But when governments need the money, then concepts of fairness and equity, they go out the window. You know, if there's money there, then they'll go after it. Before 2003, if you worked overseas, you could move overseas, you were exempted like $85,000, but now, the tax is getting...

1:23:06Well, I don't believe it, but maybe they will abolish it someday. I think they should. I think that, I thought for a long time that they should abolish it. It's not a good tax at all, but when you consider guys like, well I guess the thing that I know is if you're really rich enough, you'll avoid it. Hi, did you happen to catch Bill Gates' father, who had written a book with a younger guy, the hypocrites, who are extremely wealthy, and they want to reinstate the death tax?

1:23:57That's kind of ironic. George Soros, who maybe you've heard of him, he manages a fund, and he's the guy that broke the Bank of England, that's his claim to fame, because he shorted the pound at the time, was in trouble, and the result was that he made hundreds of billions of dollars. He wants it back too. I think their theory is that the little guy can't avoid it, and there's a lot of revenue there. I really think it's unfair because the big boys seem to be able to manage the thing pretty well. They have these foundations and things like that. Soros has, under a loophole that he has, Here is this fund that's in Curaçao. It's usually called the Soros Fund. It's now called the Quantum Fund.

1:24:53You can look it up on the Financial Times. We'll occasionally have it on it. It's a fund that is denied to Americans. Americans cannot invest in the fund. And he has made hundreds of millions and millions of dollars. Was he an instrumental in the Malaysian collapse in his speculation or not? Well, he has been accused of doing some physical hanky-panky.

1:25:43I know the French have charged him with that. They even made criminal charges against him on manipulating stocks, things, and so forth. He's not well-liked.

1:26:00One of these magazines has his picture on the cover, and they really think he's a bad guy because of the things he's trying to do. and he's one that's against repealing the death tax. Anyway, he's an interesting fellow. The reason I know a little bit about him is that my partner many years ago bought $50,000 worth of securities in the Soros Fund that he had set up. And he was the first investor in it. Are these guys volunteering to pay half of their estate when they die?

1:26:54No, I think they've already completely using foundations. So how can they advocate the death tax for everyone else? Well, because I think everybody else is bad. I think it's good for the government. I don't know. You would think that the filthy rich would be the first people against the death tax, because in theory it targets them. In theory. Yes? I want to actually go back to the Swiss banking. You may deal with it in your book some, but I was wondering if in your research, How much of it all did the Swiss Protestant Reformation, Calvin and the rest of them, play in the evolution of what we understand today as Swiss banking?

1:27:57I was interested in your comment about the Swiss president writing a public transportation. It reminded me of an article on lewrockwell.com maybe a year ago about George Washington, President Ian Martha went to, I believe it was Ohio, to visit relatives and they were gone for eight or ten weeks. Nobody in Washington knew where the press was running and the president was gone, nobody knew where he was. Of course, contrast that today with when he came here to Auburn a couple of years ago, before 9-11, and the Secret Service were in here for three weeks prior to that setting up everything.

1:28:49I don't even think they were setting up the free speech zone yet at that time. It's incredible, they spend millions of dollars on one speech. Well, I like the Chinese emperor called governing by doing nothing. In fact, speaking of that, I was staying in a hotel in California once, and Ronald Reagan was president. and he was going to stay in the top floor, it was the century plaza, the tower, and we were in the second floor, and they ordered us to move, so the Secret Service could be there, you know, we didn't move, we checked in, that was our room, we're staying here, my wife said, we're not going, and so, finally they let it go, I guess we weren't going to assassinate him, When do we reach the point that more people are drawing from the government than are paying and therefore they will rule?

1:29:55I think we're already there. Well, we'll discuss that. It was Thomas Paine that said there are two kinds of people. Those people who pay taxes and those people who live on the taxes that other people pay. And when the taxes get excessive, you're going to have problems because we tolerate it. Now, I mean, you know, with tax holiday is what may now. You pay taxes for five months and then it's yours. But that's, you know, it's, you know, revolts are funny, they, you never know when they're going to hit. Tax revolt would be nice, according to Jefferson, it would be nice, he said you need a revolt every 20 years. And at the time he wrote that, the only revolt that he knew about were tax revolts.

1:30:42There was the American revolt, there was the French Revolution, there was the Whiskey Rebellion, John Fry's and his rebellion, which was in 1798, I guess, another one, so we were racked with the tax revolts, and so was the world, we were always racked with both in Spain, the ones I talked about, those were tax revolts, and Jefferson said we need one every year, every 20 years, so we haven't had one for a long time. And along that line, it appears to me that, what is it, maybe perhaps 5% of taxpayers are paying somewhere 35, 37% of the tax.

1:31:29More than that. And then if you go to the bottom, 45, 50% are paying no tax. That's right. So the fewer people that are paying the tax for all these other people, you've got to get more people, you've got to spread the tax lower down the pyramid, so if those people lower down the pyramid feel the pain, then we can have change in the revolt, but if you're only squeezing it out of a small part of the pyramid, those people won't probably tolerate it.

1:32:08You know, one of the interesting statements in the book I picked up from a guy that said, and this was during Roosevelt's time, and he says, he says that my wealth's in the Bahamas and it's going to stay there as long as that son of a bitch is in the White House. But that's what he said, it's in print. I know that this seminar is about taxes, but it's not just taxes, it's the cost of government in general. And the cost of government is a lot more than just taxes. And unfortunately, the cost of government does disproportionately hit people who don't make very much money because of government regulation, because of tariffs, because of trade restrictions, because of restrictions on labor.

1:32:53and all kinds of distortions in the market created by government. Those are the things that really cost people in terms of standard of living. And those are the things that are really the most despicable, if you think about it, because they're rich as people, no matter how much money they pay, they still fall off. That's why they don't rebel. I mean, they might complain about it every April 15th or every quarter. You know, it's annoying, but there's still... I think the same thing would rebel if you had the same amount of tax payers. But all these hidden costs, that's the problem, that they're hidden. Yeah, litigation, tort, you know. You know, they're hidden from people that are hit hardest. And unfortunately, all they see is a lot of people or some people are way better off than they are and they want to blame those people because they don't really...

1:33:43It's so complicated, the dynamics of all these regulations. Some of the ways, like in the one book there, I discussed some of the great wealth in America that has escaped, and one was the Campbell Soup heir, and he lives in Belize or Cayman Island, one of those places, and he didn't pay any tax. And a lot of times you see these advertisements on stock, what is that guy, John Templeton? That's a real interesting story, John Templeton is American and he renounced his citizenship and he went to the Bahamas and he's made fortune in securities and doesn't know a dime in tax. So the idea of giving up your citizenship to avoid tax was a pretty easy way out because there's a lot of nice places to live besides America.

1:34:37In Switzerland, for example, you can go to Switzerland and you can make a deal with the Swiss government and they'll let you live there as a resident and you will pay a certain flat sum and you'll be exempt from the income tax and exempt from tax and you just pay that every year for your resident permit and it's a flat sum, it might be $20,000, $30,000, $40,000, $50,000, They discuss what it is, then negotiate it, and then you can live in Switzerland, and there's a lot of Americans that live in Switzerland that have made those deals, and they don't care if they come to the United States, forget it, there's a lot of wonderful things in Europe. You said the renouncing of citizenship didn't come back.

1:35:23That's what they say, yeah. But Hamilton, I've seen him on TV. Pardon? I've seen Hamilton on TV. Yeah, yeah, but this is only recent, the renouncing rule, that just came out a couple years ago. He did this a long time ago, maybe 30 or 40 years ago, he went there as a young man, so he made it, and now even that rule is a little bit fuzzy. They've got some interesting immigration rules in the United States that if you vote in a formal election, you lose your citizenship. They don't have to renounce it. We had a guy that went up to Canada and he voted in a municipal election in Toronto and they took away his American citizenship. Shouldn't have voted that way. Well, he took it to court and they turned around and he won it.

1:36:10They decided that was against public policy just for voting in a municipal election. You shouldn't lose your citizenship. It's tough because we have these immigration laws that tell you ways you lose your citizenship. You don't have to renounce. You can just comply with one of those and you've lost your citizenship. So that rule is not the problem, and if you want to become an Australian, you have to renounce it anyway, was the rule down there. Well, it's time for you guys to have lunch. I've enjoyed it. I'll talk this afternoon.