June 14, 2009
Tobacco Regulation and Taxes
President Obama will sign the new law regulating tobacco products. If successful, the long-term effect will be a dramatic reduction in cigarette smoking. This is good news for those with health, air pollution and litter concerns. But, and there is always a "but", the minuses, almost all economic, are significant. Tobacco farmers, manufacturing, distribution and sales workers will all lose their livelihood. Government, especially the states, will drop mega bucks in tobacco tax revenue, almost $15 billion in 2006 for the states.
Not a problem for the Feds, they'll just print or borrow money to fill the gap. States, however, which generally must balance their budgets, will have to pass new taxes or reduce spending (unlikely) to make up for lost tobacco taxes. Since sin taxes on booze and gambling are already high, don't be surprised if legalizing and taxing recreational drugs like marijuana is proposed as a tobacco tax replacement. Libertarians and anti War on Drugs folks would be supportive. Liberal politicians would like it. A zoned out populace would be more malleable in the hands of the Nanny State. Winners all around, yes indeed, don't be surprised.
Posted by warrenpeterson at June 14, 2009
10:13 PM | Email This
Tim Carney in "The Big Ripoff" has an interesting chapter on the tobacco wars. He points out that a lot of the regulations, especially the MSA led by our Gov. Gregoire, were strongly supported by 'Big Tobacco' as a way to help them stifle small competitors and freeze market share.
Altria (Philip Morris) lobbied hard for FDA regulation in 2004 and it was actually inserted into a bill in the Senate. But RJ Reynolds opposed it, and it was removed in the House version. A lawyer for RJR said that it would "create an overwhelming competitive advantage for Philip Morris.
2. Next we will have the Tobacco Equalization Board to make sure each state gets its fair share of tobacco taxes.
3. Looks like they'll have to cancel the expansion of the SCHIP program that relied on cigarette taxes.
4. Your Twinkies are next!
I really could care less about smokers.
Smokers are filthy discusting pigs. I am so tired of cleaning up their cigarette butts (and orelated garbage) from the bus stop next to my home - before you point out that others litter, yes to a degree. BUT, all year long I clean up the cigarette butts from the walkway and from my property and get to pull their empty cigarette packs out of my landscaping where they have shoved them.
I see people eating chips, dringing a big gulp or can or bottle of soda, getting off the bus and finishing their McDonalds or Jack in the box meal while waiting for the connecting bus and they contribute on average one piece of litter per week to my home.
The G'damned cigarette filth however is never ending and constant mess I am left to deal with.
6. Perhaps video games are next as they lack physical activity and perhaps help cause carpel-tunnel.
How about taxing bicycles and running shoes extra to help pay for the "unfit"?
Seems to me people willing to pay for their vice are going to be relieved of such things and the responsibilities for the funds will be "Joe the Plumbered" (spread around)
It's not clear from the post whether or not conservatives would approve of this new law.
One one hand, you say it will have positive health and litter impacts. so that's good right?
Then you say it will reduce tobacco tax revenue. so if conservatives like lower taxes, that's good right? And this post says this regulation of tobacco could end up having the effect of less regulation on gambling and marijuana...now we know conservatives say government regulation is bad..so having less regulation would be good...so that would be three good things, from a conservative point of view that result.
A winner all around, as stated.
Is that right?
No, Twinkies are scheduled to be heavily regulated after alcohol. Booze is the next thing the trial lawyers will be looking at in order to increase their power.
We should amend the Constitution to ban lawyers from serving in ANY elected office. There are far too many of them in government - time to get them out of government.
9. Any loss in tobacco tax revenue will simply be made up by raising taxes on non-smokers. That was always the plan. First, offer an attractive government program, that the public isn't really willing to pay for, ie; SCHIP. So, to make it palatable, just tell the people that only those nasty cigarette smokers will pay for it. Then when those revenues don't actually come in, why... they can't end the program... that would be cruel. So instead they just do what they wanted to do in the first place, and tax everybody.
10. A zoned out populace would be more malleable in the hands of the Nanny State.
Who are you kidding? The last revolution, whose grey-haired survivors are now passing every left-wing law they can think up, was run by an entire army of zoned-out, cannabis-riddled tie-dyed nihilist brats.
Now they're in charge, of course, their aim is to prevent any revolutions against themselves, who were, of course, the world apex of moral rectitude.
11. A zoned out populace would be more malleable in the hands of the Nanny State.
This has to be the stupidest argument I've heard yet to keep marijuana -- a drug widely accepted in my generation -- illegal and criminal.
Once again, it's apparent that small government conservatism has its limits when morality gets involved. Thanks warren for deciding for me that pot means "zoning out." How would you describe the effects of alcohol? "Calm introversion"?
Not sure how we jumped from Tobacco tax to legalized marijuana, but William F. Buckley had something to say on the topic.
13. Once again, it's apparent that small government conservatism has its limits when morality gets involved.
But the value of small government with limits is, that there are literally no limits to the harm that can be inflicted by a large 'progressive' government enjoying its own brief delusion of moral superiority before the bills become due.
If tobacco is so harmful, then how about just making it illegal? Give up on taxes; if the Government is really concerned about the "health of its citizens" then JUST MAKE IT ILLEGAL.
Of course, that would greatly reduce the tax the Government gets, wouldn't it?
Insufficiently Sensitive, But the value of small government with limits is, that there are literally no limits to the harm that can be inflicted by a large 'progressive' government enjoying its own brief delusion of moral superiority before the bills become due.
Bills become due? So now conservatism is about social cost? Great, let's pass cap-and-trade this year.
Yes, by all means let's start cap-and-trade. In Canada, they are having to close regional medical facilities because of their own cap-and-trade program. Thus making medical care even more scarce.
Can't afford the carbon credits, you see.
Just terrific. Anyway, back to cigarettes. What will happen to those programs that are funded by cigarette taxes when those revenues fall?
17. So now conservatism is about social cost? Great, let's pass cap-and-trade this year.
It is the 'progressives' that love social costs, particularly when they can buy the votes of one bloc with the hard-earned capital of another smaller one.
But the bills from cap-and-trade will become apparent to the whole electorate, contra the happy prattling of candidate Obama about 'no increase of taxes to those earning under 250K'.
Power bills after cap-and-trade will sock it to everyone, even the sacred 'progressives'.
Sensitive, what does this comment mean if not social cost? But the value of small government with limits is, that there are literally no limits to the harm that can be inflicted by a large 'progressive' government enjoying its own brief delusion of moral superiority before the bills become due.
Why is social cost relevant in the area of marijuana policy, but not in environmental policy? Why do you pick and choose when government should be small? Your inconsistencies are broad.
(I personally think the social cost of marijuana is very limited.)
19. Why do you pick and choose when government should be small? Your inconsistencies are broad.
It's plenty consistent to prefer small government. 'Twasn't me that decided we're talking about progressives, then social costs, then cap-and-trade, then marijuana, then the environment.
Small government is better than monster government with the audacity to hope that everything not prohibited be compulsory, country-wide.
Keep government restricted to essentials that counties and cities and states can't provide. The negative restrictions on government in our Constitution are the key to the most productive and enlightened civilization since Pericles.
You will notice the consistency of this argument, I trust.
20. Now that tobacco is regulated by the FDA, perhaps we could stop the Feds from subsidizing it.
21. Sensitive, you argued that "the bills become due" when marijuana is decriminalized. What bills are these?
22. Sensitive, you argued that "the bills become due" when marijuana is decriminalized.
Ahem! The exact words were there are literally no limits to the harm that can be inflicted by a large 'progressive' government enjoying its own brief delusion of moral superiority before the bills become due. There was zero reference to either marijuana or decriminalization.
Judging from the current bloated Administration, which does consider itself somewhat 'progressive', the bills foisted on our grandchildren will be due to its monstrous binge of borrowing to sate the world's record of fiscal greed for political payoffs to patrons of every voting bloc they can buy.
What, no one cares about liberty any longer?
Isn't that what Liberals care about?
Oh I forgot, it's "Progressives,"
So now we need progress, before liberty.
How does Government control over people provide progress? Oh I get it, progress according to some people, but who. Liberals?
So the idea is that the more progress we have the more liberty liberals will have? Wait a second don't liberals smoke?
Gee Rizzo, splian this one to us will ya??
How can any of this possibly be good?
24. So, can anybody tell me what will happen to programs funded by tobacco taxes if those revenues dry up? End the programs, right?
Sensitive, I thought you had meant that us potheads are all for legalizing marijuana but don't want to accept all the harm that comes with it: on families and society. I don't agree with that argument, but clearly you didn't make it, so I guess we're okay. Apologies.
That'll teach you to write so eloquently.
Not to worry. Sorry about the verbosity. It's interesting that most potheads I know (lots) have never been interested in legalization, except for the few unfortunates who had to undergo chemotherapy. They still have not been overstressed finding sources.
And even (relatively) small governments can bite. Harry Anslinger's campaign against the dreaded MJ got rolling in the 1930s, boosted by some sensationlism in the Hearst papers, and some spectacular scare quotes excerpted from police records. By today's standards that was micro-government, but they sure put away a lot of potheads.
"Official: Obama to propose new consumer agency "
Cool! More babysitting! We can never have enough agencies. That's what I always say!
programs funded by tobacco taxes could be funded by marijuana taxes; or income taxes; or soak the rich taxes; or soak the poor taxes; or they could be cut; all according to what the congress decides after elections in which we would hash all this out.
Since wht we fought the revolution for was to not have "taxation without representation," and we won and we got the representation, and we put the power to tax was put in the federal government, specifically in fact, there's nothing contrary to our fundamental principles about taxes that are chosen by our legislative process.
IOW, not to worry. Rest assured that if other taxes go up, it will only be because your fellow citizens basically outvoted you and your point of view there should not be taxes.
That's democracy, which in the other thread you are quite correctly supporting for Iran.
I am sure you support it for the USA, too.
Oh, certainly I do. As for taxation without representation, the folks who are not yet 18 are being taxed with no say in it all, because of the massive borrowing that will come due when they are older.
In fact, you could say that you and I are enjoying a certain level of 'Representation without Taxation'. Kind of turned on its head, ya know?
Basically, as for cigarette taxes, the people who pushed 'em knew that one day they would have to push the tax on non-smokers. They just used smokers as an excuse to get their trojan horses built.
There is areason ardent anti-tobacco people are referred to as Smoke-Nazi's. They are merely continuing what Adolf Hitler began.
Why not just ban it outright?
Oh wait, that was tried in 2003 in NOrth Dakota and that proposal met heavy opposition from the American Cancer Society, American Heart Association, nearly all the ardent anti-tobacco groups.
Seems they saw their cash cow going away.
So much for your health and nostrils being free of that offensive odor.
Legalization can't come quick enough. We legalized (alcohol) to save our own country from the likes of Al Capone and now we owe it to Mexico, while that country still exists, to legalize-and-tax now.
I can't imagine a real conservative being for anything else.
new left conservative 1
PS Anticipating a brilliant rebuttal to my point, I'd like to state: I'm not a user!
I'm pretty sure the likes of fried chicken, Doritos and french fries kill more people each year than cigarettes, yet they don't regulate those.
News flash: with the control under the FDA, the states will use new found power to put Tobacco sales under the authority of the liquor control board. Pretty soon users will need to go to the state store to purchase single cigarettes at large prices. The state will not only get the full profit, but also the tax and this will alleviate the lost revenues. The FDA will ease up once the states control the sales.
33. The FDA is now threatening to classify Cheerios as a drug. Anyone notice that this government is getting just a little out of control?
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