Three Dragons Battle a Mouse Over Value of Money
July 24, 2009 by Bob Livingston
In the scorching Nevada heat a battle is taking place that pits, essentially, three enormous dragons against a mouse. It’s the case of the Internal Revenue Service (IRS) vs. Robert Kahre, and its outcome could have an enormous impact on our nation’s money, particularly if the economy collapses and hyperinflation sets in as we expect.
But Kahre isn’t just facing the IRS. His antagonists include the Federal Reserve and U.S. Justice Department. All three entities have ever-full money sacks, giving Kahre long odds of success indeed.
We mentioned Kahre July 7 in an article about the Justice Department’s attempts to gather information on people posting comments on the Las Vegas Review-Journal website about the case. So this case is about both freedom of speech in the U.S. as well as monetary policy. But since we dealt with the freedom of speech issue last time, we’ll deal with the monetary policy now.
Kahre, a contractor, is one of four people charged in a 57-count indictment of fraud and conspiracy. What he did was expose the Fed for the fraud it is. So now he’s fighting the three behemoths, the IRS, the Fed and U.S. Justice Department.
According to the government’s case, Kahre and others concocted a fraudulent cash payroll “scheme” and then peddled it to other Las Vegan contractors. What was Kahre’s “scheme?”
He paid his subcontractors in gold and silver coins. Then, using the face value stamped on the coins, determined their payments didn’t pass the threshold for reporting to the IRS.
Appearing on a screen in the courtroom during the government’s opening trial arguments were the words, “This is a case about money, greed and fraud.” Truer words couldn’t have been spoken, and the fact that a government lawyer was uttering them is truly ironic.
For the money, greed and fraud angle falls on the heads of the three dragons. The money Kahre used to pay his subcontractors is stamped by the money creators as legal tender, with dollar denominations stating their value. The fact that their face value represents amounts far less than their actual value is evidence of the fraud the government has perpetuated on its people.
Just as junk silver coins printed prior to 1965 are worth more for their metal content than their printed face values, the gold and silver in U.S. Mint legal tender coins are too. And the reason this has occurred lies with the non-constitutional entity called the Fed, which prints fiat money backed by nothing. This has devalued our nation’s currency.
In Kahre’s defense, lawyers argue that the workers agreed to be independent contractors so he did not have to withhold taxes for them. His six businesses are in the trades of painting, drywall, tiling, plumbing, heating, cooling and electrical work. It is not at all unusual to pay this type of employee as a subcontractor without withholding taxes and sending the IRS and subcontractor IRS Form 1099 at tax time if the payment threshold is met.
By claiming the payments on the face value of the coins, that threshold was never met. So the IRS got irritated because no taxes were owed.
In essence, Kahre manipulated the government’s own laws to his and his contractors’ advantage and the big government boys and girls at Justice and IRS, and the thugs at the Fed didn’t appreciate Kahre’s imagination.
So they came down on him and his friends hard. And to put another kicker on it, it’s Kahre’s second trial on essentially the same charges. The first, last fall, ended without a conviction, so Justice lawyers dropped a few defendants, added one, and reworked their charges. Not a true case of double jeopardy, as he wasn’t acquitted the first time. But the big government boys and girls are so unhappy with him they’re taking a second shot.
When hyperinflation hits, the economy collapses and gold and silver coins are used for payments and trade, how will we be taxed? The face value of the coin? The coin’s value in dollars? Will there even be a government left to tax us? These are questions we’ll be dealing with in a few years.
And one other thing: a curious aspect of this trial is the lack of interest shown it by the media. Nothing reported in the mainstream media, and not much even from local media—just the original story and another that ran July 5 without actually covering details of the trial.
Perhaps the media is afraid big government boys and girls will target them once they’re finished feeding on the little mouse appetizer.