“Neither. But I am a guy who can help. What just happened?”
“Does the whole damn world know what I’m doing? How did you find me?”
They were attracting attention.
“Keep your voice down, okay? And don’t look a gift horse in the mouth. What did Kim want?”
“Who’s Kim?”
“The guy who was just here. Kim Yong Jin.”
“Who is that?”
“Not someone you want to mess with.”
“You here to take me in?”
“That was the original plan, but things have changed. Paul Larks is dead.” He saw that Howell had not known that. “Kim killed him.”
Howell appeared both frustrated and scared. “This is getting way out of hand. You may not believe this, but I have no idea who that Korean is. He and I emailed some, but he used an alias. What does he want with me?”
“Actually, I can believe all of that. But I need to know what’s in that satchel?”
“Look … what’s your name?”
“Cotton Malone.”
Howell threw him an odd look. “How’d you get a tag like that?”
“Long story, and we don’t have the time. Answer my question.”
“That guy Kim has Jelena, my girlfriend. He said he’d kill her if I didn’t hand over the satchel. She’s an innocent here. We met in Croatia. That’s where I’ve been hiding. She was just doing me a favor. Larks bought my ticket for that cruise, but I changed it into her name.”
He doubted Larks bought anything. More likely Kim had financed the whole venture as a way to gather the players in one place.
“What’s in the satchel?” he repeated.
“Proof of a conspiracy that will bring America to its knees.”
“That’s a bold statement.”
“Who do you work for?’
“Justice Department.”
“I can’t let anything happen to Jelena. She doesn’t deserve this. He said he was coming back after he looked over the documents.”
He zeroed tight on Howell’s eyes and said for the last time, “Tell me what’s in that satchel.”
* * *
Kim entered the cabin Hana had booked for them. It came with twin beds and a small bathroom with shower. They were both traveling on false passports, under aliases, which he’d obtained in Macao. He liked the ability to move about the world unobstructed and, compared with the time he’d tried to gain entry into Japan years ago, the state of the art in forgeries was far superior. Besides, no one paid him any attention.
“How is our guest?” he asked.
Hana pointed to the bed where the woman lay, laboring under the effects of the same drug used on Malone and Larks. He found it so much easier to travel with drugs as opposed to guns. No one ever questioned them. Most people today carried small pharmacies around with them.
“She was no trouble,” Hana said.
They were two decks down from the dining salon, toward the bow. He saw she noticed the satchel, and he smiled at their success.
“Time for us to see if all this was worth it.”
* * *
Malone listened as Howell explained that the 16th Amendment to the Constitution came as a direct consequence of an 1895 Supreme Court decision that held taxes on incomes must be apportioned, under Article I, Section 2 of the Constitution. That would mean people living in less populated states would pay a higher tax on their income so that their portion of the overall total was equal to that of other more populated states. That fundamental unfairness had been intentional on the part of the Founding Fathers, as they were no fan of direct taxes. Apportionment became the way to discourage them.
And it worked.
Direct taxes were avoided by Congress.
But during the early part of the 20th century sentiment changed. The Gilded Age had produced clearly defined classes of “haves” and “have nots.” Social unrest had firmly taken hold, and the idea of a tax to “soak the rich” became popular among liberals in both the Democratic and Republican parties. Several times Democrats introduced bills in the House of Representatives to tax higher incomes, but each time the conservative branch of the Republican party killed the measure in the Senate. That’s when Democrats began to call Republicans “the party of the rich.”
And the label stuck.
Causing reelection anxiety.
In April 1909 the Democrats proposed another bill for a national income tax as a ploy to embarrass Republicans and force them to publicly acknowledge their support for the wealthy. Nobody gave the bill any chance of passage—and even if it did, there was still the matter that unapportioned income taxes had, fifteen years earlier, been ruled unconstitutional. But to everyone’s amazement Teddy Roosevelt and other liberal Republicans endorsed the measure. Conservative Republicans then fell into a panic. Oppose the bill and they would certainly become “the party of the rich.” Support the bill and they would lose their political base—which was the rich.
So they opted for an end run.
In June 1909 President William Taft, a Republican, caught the Democrats off guard and proposed the 16th Amendment. At the precise moment when it appeared that Democrats would pass an income tax bill, the Republicans cho
se to submit the entire matter to the states for their approval. Even better, if the amendment was approved, it would eliminate the Supreme Court’s opposition to income taxes, overruling the apportionment requirement, and allowing the tax to be imposed equally nationwide. The Republican strategy seemed brilliant on paper, as the amendment had little chance of passing in Congress and, even if it did, three-fourths of the states would surely reject it.
But they were wrong.
The Senate backed the amendment 77–0 and the House 318–14.
Then state after state ratified until, on February 12, 1913, Secretary of State Philander Knox declared the amendment “in effect.”
“When the first income tax was approved in 1913,” Howell told Malone, “it was only 1 percent on the first $20,000 and 7 percent above $500,000. That would be 1 percent on the first $298,000 in today’s dollars and 7 percent above $7,460,000. By 1939 only 5 percent of the population was required to file a return. Today more than 80 percent have to file.”
Howell sounded like a true fanatic, who loved to rely on statistics to support their position.
“The collection process changed in 1943. That’s when FDR started withholding from wages and salaries. Income taxes began to be collected right at the payroll window, before they were even due to be paid by the taxpayer. That’s when the whole thing went from a tax on the rich, to a tax on the masses.”
He studied the salon again and saw no sign of Kim.
“I’m worried about Jelena,” Howell said.
“You keep talking. I assure you, she’s fine. For now.”
* * *
Kim opened the satchel and removed a thick sheath of papers clamped together with a black metal clip. Several hundred pages, all of which appeared to be copies, except for one. He scanned through the pile, taking in bits and pieces. Clumps were stapled together.
One of the copies caught his eye.
A report.
Department of Justice
_______
Office of the Solicitor
_____________
Memorandum
February 24, 1913
Ratification of the 16th Amendment to the