The Third Tablet

I had a dream recently.

I dreamed I was Moses.

I had just received the two tablets and thought it was time to go down the mountain and present them.

Instead, I paused; a voice had just said "Moses; stay a minute; there is more".

And a third tablet appeared.

On it was scribed in fire:

Predictable income is taxed.

Unrealized wealth is not.

Borrowing is not income.

Interest can be deductible.

Step‑up erases gains.

Banks profit from facilitating the cycle.

Go ye forth and spread the news.

I awoke, found it to be dawn, fired up my computer and paid my final quarterly FIT estimate for the year, it being 15 January.

"Gosh I'm glad I'm not a billionaire" I said to no one in particular. 

"They must pay a whole lot of taxes".

A few days later, as I exited the Sunday service at my church I stopped at the door out to talk to my pastor who was there greeting her flock as they exited.

I told her the story of the three tablets.

She said "ah my son, you have been given The Parable of the Tablets".

"Here is that tale, handed down from antiquity."

The first two tablets are about how people ought to behave.

The third tablet — your tablet — is about how the system actually behaves.

And the commandments on it aren’t moral imperatives.

They’re structural truths:

Predictable income is taxed: Pensions, RMDs, Social Security — the world you live in.

Unrealized wealth is not.  

That is called the "world of assets".

They grow untouched for decades.

Borrowing is not income.  

It's the quiet escape hatch for those who can collateralize their lives.

Interest can be deductible: the government subsidizing the escape hatch.

Step‑up erases gains.  

That's the final absolution.

Banks profit from facilitating the cycle.  

They are the priesthood of the system.

You didn’t dream a fantasy.

You dreamed a diagram.