He sat in the rear seat with the wooden crate they’d retrieved from the hall closet. He’d switched on one of the rear ceiling lights and was rummaging through. The glare was blocking her ability to see out the rearview mirror, but she knew better than to ask him to cut it off. The car with the two Secret Service agents followed closely. Dawn was less than an hour away. Strangely, she wasn’t tired, though she should be. She’d passed the fatigue threshold several hours ago and found the point where the body began to run on autopilot, sleep be damned.
“It’s full of old books,” he said. “Most of ’em are on George Mason. And then there’s this.”
He stretched his arm forward and displayed between the two front seats a copy of a thin, hardbound volume. Taxation: The People’s Business. Written by Andrew W. Mellon.
“I didn’t know he was an author,” she said.
The book disappeared back to the rear seat. “This one I know all about. Edwin gave me a rundown on it yesterday.”
“You two have been busy. Don’t you have a country to run?”
He chuckled. “Actually, the thing runs itself. Especially when you’re a lame duck. Nobody gives a crap what I have to say.”
She knew better. “Unless you want them to give a crap.”
“The copyright page says it was published by the MacMillan Company in 1924. Edwin tells me that David Finley, Mellon’s close associate, actually wrote it for him, but everything in it was pure Mellon.”
She heard him flipping through the pages.
Then he started reading out loud.
The problem of the Government is to fix rates which will bring in a maximum amount of revenue to the Treasury and at the same time bear not too heavily on the taxpayer or on business enterprises. A sound tax policy must take into consideration three factors. It must produce sufficient revenue for the Government; it must lessen, so far as possible, the burden of taxation on those least able to bear it; and it must also remove those influences which might retard the continued steady development of business and industry on which, in the last analysis, so much of our prosperity depends. Furthermore, a permanent tax system should be designed not merely for one or two years nor for the effect it may have on any given class of taxpayers, but should be worked out with regard to conditions over a long period and with a view to its ultimate effect on the prosperity of the country as a whole.
These are the principles on which the Treasury’s tax policy is based, and any revision of taxes which ignores these fundamental principles will prove merely a make-shift and must eventually be replaced by a system based on economic, rather than political, considerations.
There is no reason why the question of taxation should not be approached from a non-partisan and business viewpoint. Tax revision should never be made the football either of partisan or class politics but should be worked out by those who have made a careful study of the subject in its larger aspects and are prepared to recommend the course which, in the end, will prove for the country’s best interest.
I have never viewed taxation as a means of rewarding one class of taxpayers or punishing another. If such a point of view ever controls our public policy, the traditions of freedom, justice and equality of opportunity, which are the distinguishing characteristics of our American civilization, will have disappeared and in their place we shall have class legislation with all its attendant evils. The man who seeks to perpetuate prejudice and class hatred is doing America an ill service. In attempting to promote or to defeat legislation by arraying one class of taxpayers against another, he shows a complete misconception of those principles of equality on which the country was founded.
“Easy to see how Mellon and Roosevelt fought,” Danny said. “Class warfare was Roosevelt’s ticket to four terms. He played that card every chance he got. But it was a smart move. There were a whole lot more ‘have nots’ than ‘haves,’ and numbers win elections.”
She could tell something was still bothering him.
It had been all night.
“Mellon was right,” he said. “Raising tax rates does not raise revenues. In fact, just the opposite happens. The rich just find a way to legally shelter their money and avoid the higher taxes. And who could blame them. But every time we’ve lowered tax rates, revenues rose. Harding. Coolidge. Hoover. Kennedy. Reagan. Bush. They all got that.”
“What’s the problem?” she finally asked him.
“My Treasury secretary lied to me. Edwin found out that Larks may have stolen an original along with all of those copies. Joe Levy never said a word about that. I’d bet my ass Morgenthau classified that crumpled sheet of paper he got from Mark Tipton, the one Mellon gave to Roosevelt, and Larks swiped it from Treasury.”
“And now it’s out there, loose on the world, and could fall into the hands of people who might figure out how to solve the code. Ask the secretary of Treasury if he lied. Joe works for you. If he holds back, fire him.”
He switched off the interior light. “That’s just it. I don’t think he’s doing anything to hurt me. I actually think he’s tryin’ to protect me.”
“From what?”
She approached a ramp for the interstate and entered the highway, increasing speed, the two headlights staying right behind her.
“That crumpled sheet of paper,” he said.
And she agreed.
“I’m not going to fire the guy for falling on his sword. You need to read Howell’s entire book.”
She’d caught enough through her perusal at the courthouse to sense its overall gist. “He’s an income tax fanatic. Seems to have a lot of issues with the 16th Amendment.”
“Here’s the deal,” he said, his voice low and distant. “Our national debt is $16 trillion. The interest on that debt is right at $200 billion a year. I found a website the other day with a counter that clicks off the national debt, as it accrues by the second. I sat there and watched the damn thing. It’s like a million dollars every minute. Can you imagine? It’s friggin’ mind-blowing.”
“And you just sat there and watched?”
He chuckled. “It’s kind of hypnotizing.”
She smiled. Sometimes he truly was like a big kid.
“Ninety percent of the revenue used to pay that debt comes from one source,” he said.
And she knew where. Income tax.
“Imagine if that tax was illegal?” He snapped his fingers. “No more 90 percent. Gone. Just like that.”
She caught the implications, but had to say, “It could be replaced?”
“Really? Congress would have to pass a new amendment, then thirty-eight states would have to ratify it. That would take a lot of time, all while that debt keeps growing at the rate of a million dollars every minute. And by the way, we couldn’t borrow a dime to cover any deficits since our credit wouldn’t be worth spit. Even if you passed a new income tax, we’d never catch up. The trillions in accrued debt would bankrupt us. Even worse, what if we knew the 16th Amendment was illegal all along, but declared it valid and kept collecting it. That’s fraud, making us liable for all those trillions of dollars we stole from folks.”
“A bit far-fetched, wouldn’t you say?”
“I’m not so sure. I got a bad feeling here, Stephanie, one I’ve learned to trust. I keep thinking about the Chinese and the North Koreans. And Kim. What’s he after? Then I remember that our number one creditor is China. We owe it $1.2 trillion, growing by the minute, too. What do you think would happen if we defaulted on that debt?”
She knew. It could collapse China’s economy. “You think Kim is after the ammunition to take down our income tax?”
“You heard the ambassador. Unlike Dear Leader, Kim doesn’t owe China a thing. He’d just as soon stick it up their ass as not. That ambassador back there was scared. I saw it in his eyes and heard it in his voice. He tried to hide it, but he was afraid.”
She’d also felt the apprehension, noting a few phrases hidden in the conversation, and a hesitation where there should have been none.
They kept speeding north down the interstate, the beginnings of the day’s rush hour not yet upon them. The sky overhead was fading from black to salmon. To the east, the sharp edge of a brilliant sunrise had already begun to illuminate the gray light of dawn.
“This dirty laundry of ours,” he muttered, “has a real stink to it. But thanks to Paul Larks it may be about to get an airing. You’ve known something’s bothering me. I saw it in your eyes at Treasury. This is it. Our Achilles’ heel.”
They rode in silence for a little while, both of them in thought.
“We can’t let this happen,” Danny finally said.
“I’ll check in with Luke and Cotton, after I leave you at the White House.”
“Do that. I need to know what they’ve learned on that end.”
The lights of the Capitol loomed ahead. A few minutes more and they would be at the White House.
“Before we get there,” Danny said from the rear seat, “there’s a couple of other things you have to know. Things I couldn’t say in front of Harriett.”
THIRTY-SIX
CROATIA
Isabella ran through the rain after Luke Daniels, the cobbles gleaming with moisture. She wondered what he meant when he told Malone, We’ll be right with you. The answer to her inquiry came as Daniels flagged down a taxi then, when the car stopped to retrieve him, flung open the driver’s door, yanked the man out, and shoved him to the wet concrete.
He motioned for her to climb inside.
She hesitated.
“Fine, stay here. You’re a pain in the ass anyway,” he yelled.
Dammit. She had to go. So she rushed to the front passenger-side door, opened it, and slid in. He settled behind the wheel, slammed the gearshift into drive, and off they went, tires spinning in the swishing rain.
“You never stole a car before?” he asked her.
“Hardly.”
He shook his head. “Welcome to my world.”
“You realize that driver is going to call the police,” she said.
“Hopefully we’ll be long gone before they can find us.”
He was following a road that rimmed the peninsula, outside the town walls along a quay, heading for the causeway to the mainland and, she assumed, the road that ran against the shoreline in the direction of where Kim and Malone had headed by boat. They were playing catch-up, but he was making time, passing cars, bursting through intersections, ignoring every traffic law.
And drawing lots of attention.
Horns blared and brakes squealed.
“You’ve apparently done this before?” she asked, trying to stay calm and holding on.
He twisted the wheel hard left and they turned north, now along the bay road. “I’ve had a little practice.”