Category : General News

Milking a Dry Cash Cow

Well, once again, I have been caught asleep at the switch. Back in July, U.S. Sen. Tom Harkin, a Democrat from Iowa, introduced a bill that if it is passed and signed by President Obama will wreck the pipe tobacco industry.

The bill has the support of 13 other Senate Democrats. You got to wonder, “What are they thinking, if they can think.” This nation needs a complete overhaul of its political system. Not just a fix. It needs new everything, in my humblest of opinions.

But, I am off track. This epistle has nothing to do with the innards of politics today, but everything with specifics.

My apologies for not seeing this sooner. I am making no excuses, but I read newspapers everyday in print and online. If this made it in our local newspaper, I missed it. Likewise, I missed it online as well and I read several online newspapers daily as well.

What I am saying is that once again, it appears the mainstream media, which once was the mighty newsprint industry, failed to report a significant issue.

Sen. Tom Harkin, a Democrat from Iowa, who really brings home the bacon for his state—just look up his pork report—has now set his sights on funding the federal disabilities act for disabled children, which Congress approved more than three decades ago. It just never got around to funding the thing.

Note: I have created another “page” where you can read the entire act. Or, you can go to Thomas for the whole enchilada.

Now, before you haul me off to the disabled children’s agents for quartering, I want every disabled child in the nation to be helped. I can carry you to some of the most pitiful places on earth in Appalachia and show you disabled children who never get a solitary dime from anyone. So, don’t talk to me about helping. This big-time happy yak of helping the disabled needs to start at home. I have seen the bleakest of the bleak in Appalachia, and it is a disgrace to this nation the life some of those people live.

My newspaper reporting, in fact, for several years fell on deaf ears. I am hard-nosed when it comes to this, so if you want to argue with me about helping the poor and disabled you best bring your lunch and some experience.

I digress. Congress did its usual two-step with the help for disabled children bill several decades back: It passed a bill and then passed payment on to the next generation.

And now Harkin has gotten the idea that he can completely fund the Individuals with Disabilities Education Act (IDEA) and stop you from smoking your pipe or cigar at the same time. That’s a “win-win,” one of the worst word descriptions I have ever read, as some would say in Washington.

I have read the bill and how it heaps tax increases upon all smokers, and yes, pipe smokers you are included this time. No dodging this one for you.

Harkin’s bill, officially alive as SB 1403, would destroy the tobacco industry as we know it. Oh, maybe he hadn’t thought of that, because tobacco taxes from his bill are how the senator plans to fund the IDEA.

Here is what happens under his proposal:

(1)  Excise tax on SMALL CIGARS- goes from $50.33 to $100.50.

(2) CIGARETTE taxes take a double whammy of heading up from $50.33 to $100.50, and from $105.69 to $211.04.

(3) Harkin’s Tax Parity for Pipe Tobacco and Roll-Your-Own Tobacco would send pipe tobacco from $2.8311 per pound to $49.55 per pound. Mind you, we are talking merely the tax on a pound of pipe tobacco, not the retail price. Manufacturers and retailers are on their own as to how they get their money.

If Harkin assumes that he will fund the IDEA through this scheme, he has been smoking something other than tobacco.

These kinds of taxes will demolish the tobacco industry, taking down his revenue stream with it and will put thousands of people out of work at a time when the nation is desperate for jobs.

If I were running for office, my only political placard would be, “It’s Jobs, Stupid.”

Not only does Harkin’s act of incredible stupidity destroy an American industry, it also takes out the hundreds of thousands of people who are part of the Dominican Republic-Central America-United States Free Trade Agreement, or known by its initials as CAFTA-DR.

Friends, CAFTA isn’t small potatoes. The region includes Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua. It is a very large trading partner with the U.S., regardless of what you think of free trade agreements.

You cigar smokers will recognize those names right off. The big kahuna left off of any trade agreement, of course, is Cuba and one of these days the U.S. will come to its senses and realize that the cold war is over, Fidel is really a sick old man, his brother Raoul is a numb nuts and we should be trading with the nation that is so broke, its best car on the lot is a 1956 Chevy.

And, by the way, Cuba isn’t hundreds and thousands of miles away. It’s a boat ride from Miami. Get real. You mean to tell me, a nation the size of a spaghetti noodle remains some sort of a threat to the U.S.?

And while you have read this far, you might as well peruse this: The CAFTA-DR region was the 15th largest U.S. export market in the world in 2010, and the third largest in Latin America behind Mexico and Brazil. The United States exported $24.2 billion in goods to the five Central American countries and the Dominican Republic in 2010, an increase of 21 percent over 2009. That is money in the pockets of American business enterprise.

For the five-year period that CAFTA-DR has been in force (2006-2010), U.S. exports grew by 43 percent, which compares very favorably to the 25 percent growth experienced during the five years (2001-2005) before CAFTA-DR.

U.S. exports to all the CAFTA-DR countries have experienced significant growth during the first five years of the agreement, led by Guatemala and Nicaragua (both up 57 percent), followed Costa Rica (44 percent), Honduras (42 percent), Dominican Republic (39 percent) and El Salvador (32 percent).

I think you are getting the picture. We are about to shoot off our toes and feet with Harkin’s hair brain IDEA. A majority of the U.S. cigar market depends upon the names you just read. We are about to put thousands of those people out of work because U.S. taxes have been hoked up by some halfwit politician (a career pol who has been in the U.S. Senate since 1984, and was in the U.S. Congress before that beginning in 1974).

And, yes, this comes at a really critical time in American history. The jobless rate is running over 9 percent. Today, something like 53 million children in America live in poverty, more than ever before, because both parents are out of work.

If this sort of numb skull political bill, which is a bone to the educational lobby, and the Americans with Disability Lobby, who have actually said that Harkin’s bill will “fully fund” the IDEA with no consequences, and at no cost to the American taxpayer, gets by then coming around the bend is an economic monster that will make the Great Recession look like the Great Recess.

No consequences? No cost to the American taxpayer? Now, dear reader, you can see that your tax dollars for public education in the past decades have failed. It produced idiots whose deductive reasoning powers are in the minus wattage.

Dropping this load of tax increases on the already staggering tobacco industry will simply finish it off, wiping out thousands of jobs, closing thousands of retail outlets, shuttering thousands of manufacturers, creating a huge joblessness in the CAFTA nations, and affecting a choking impact on America’s trade deficit and the GDP (that’s gross domestic product for those of you anti-tobacco zealots who have a hard time understanding economics 101).

So, if you are a smoker of any sort, and you want to continue to be a smoker, you need to read this, and then get busy contacting your congressmen and women. You need to tell them that Harkin is a hair ball, and that if you think the past few years have been bad, wait until you shut down the tobacco industry, and force it to go on the black market, where the federal government receives zippa in taxes.

That’s because, for those who are not too street wise, black market sales never happen on anyone’s books. Strictly cash and carry. No records or nice sales slips and tax forms. Your state treasuries will love this result.

I am truly amazed at the depth of stupidity in Congress. I am also astounded that the mainstream media has lost its chones to face up to its responsibilities as the last bastion of hope for the little guy, for mom and pop and apple pie.

I am proud that I was a newspaper reporter under the old breed: they would kick your ass and challenge you to a fist fight outside the bar. They wrote both sides of the news with all the facts, because frankly their reporters were afraid for their asses if they had the facts wrong. You got it right or got gone. You got it first or you were the first out the door.

You were tough or some old man twice your age would break your head with a glue pot. And if a reporter could get through that gauntlet, his editor knew his reporter would be fearless when he had to tackle the real crooks out there in zulu land at the county courthouses, the city councils and the school boards, where people were attaching their sticky fingers to taxpayer’s hard earned dollars.

Those days are gone. You, dear reader, are the loser. And so is our nation.

You can either vote Harkin and his kind out of office (that would be any Senator who has been in the U.S. Senate more than two terms, which is 12 years, and any Congressman who has had six terms, which is also 12 years.

Or, you can watch your favorite pastimes disappear, along with your rights, one by one. And, you are picking up the tab.

In 2011, rank and file Congressmen and women in the U.S. House and Senate receive a current salary of $174,000 per year, plus office expenses for bloated staffs, plus health insurance, some for life. And, you are also picking up an enormous tab for Congressional pensions, also lifetime for many of the career pols.

Are you getting the picture that the fox is in the hen house and the American taxpayer is getting plucked?

Tobacco was once America’s largest and most important cash crop. Today, it is a cash cow for politicians.

And, folks, that cow is running on dry.Pipe Icon

Canaries in the Mine

Everywhere you look these days, smoking ban legislation is proposed in state houses. Across the nation, state pols are bellying up to the anti-lobby bar, taking money to sponsor bills to prohibit tobacco even in the great outdoors.

The last time I looked, we all owned the air we breathe. If you don’t like my pipe or cigar smoke, you have the perfect right to walk on. I won’t mind.

America was once free. Its air was free. Its great outdoors were free for enjoyment, picnics, family recreation, family fun. That day for pipe, cigar and cigarette smokers, seems to be coming to an end. 

We are living in trying times. The Rights of Man apparently no longer apply to individuals. Disingenuous state and national politicians, lobbiest, ultra-conservative, right wing zealots have taken command of the public sector.

My thought is that although I love my pipes and cigars, what other rights am I about to lose? I think we pipe and cigar smokers are the canaries in the mines.

Some of the proposed state legislation (many  thankfully set aside momentarily)  that I have been reading, such as in Kentucky, Alabama, Maryland, California and others, would ban smoking even outside your own home.

I might be able to understand nut jobs in California (and hey, it’s legal to smoke marijuana there, right), but I certainly do not get Kentucky, Alabama and Maryland. They were and still are great tobacco states.

Friends and neighbors, the handle is coming off the pump (the explanation for this is in our archives). If we fail to find some friends in these state house, friends in Congress, friends in public who may not smoke, but who are also worried about losing  other personal and civil rights, then we are doomed.

We will become branded outlaws, seeking our pipes and tobaccos in the blackest of black markets.

Please look up Cigar Rights of America and the International Premium Cigar & Pipe Retailers Association and search legislative alerts on both sites for more information on proposed “tobacco legislative reform.” Be warned. If you have never done so, you will be horrified at what you find.

And then try to convince your local newspapers and television outlets to take a look at the other side of this smoking issue. This isn’t just about losing the right to smoke in public. That right is gone.

We are now in a time of losing the right to be free in America to make our own decisions.

Maryland Loses Its Mind . . . Revenue to Follow

I am just now reading a disturbing note from PipesMagazine.com about Maryland and what it is doing to pipe tobacco specifically and to tobacco in general. That is because I am a little behind in everything right now.

PM’s Kevin Godbee, owner and publisher of the online pipes and tobacco magazine, brought this to attention in one of his blog posts. If you don’t know PM, you should. Here you will find the latest pipe and pipe tobacco news, features, photos, blogs, just plain good stuff for the pipe smoker.

Godbee wrote about Maryland and its heretical shenanigans the first of March. It’s enough to make a pipe smoker cry.

Until 2000,Maryland had a 370-year history of tobacco farming. Then in 2000 almost 90 percent of the state’s tobacco farmers said they would accept a government buyout, and plant tobacco no longer. They had had enough harassment from the state and federal agents and government interference in their livelihood.

The crop that had settled the Chesapeake was now seen as a health hazard.

By 2003, Maryland had begun the buyout program. Farmers agreed to plant alternative crops instead of tobacco. By 2004, some 785 growers were in the buyout program, representing 80 percent of eligible growers and 7.3 million pounds of tobacco.That action took a lot of top grade pipe tobacco off the market, forcing manufacturers to look for pricey overseas sources.

If you know your tobacco history, you know that at one point in Colonial times, tobacco was better than the gold standard. It was used as currency to trade with England.

Now for today’s update. The state of Maryland has lost its mind. No, really.

First, the state is preparing to increase tobacco taxes by 500 percent.

The next move is even worse. The Maryland legislature has passed a law that takes effect May 1. The law will prevent the online sales of pipe tobacco. In order to sell pipe tobacco and premium cigars in Maryland, you must be an OTP licensee, or OTP (other tobacco products) and have a physical presence in the state.

As if that is not enough, in a Q&A fact posted by the state, it lays it out in plain English:

Is it illegal to sell OTP to consumers by mail or over the Internet?

OTP may not be sold to consumers in Maryland by mail or over the internet. Maryland consumers must purchase OTP from a licensed OTP retailer or licensed tobacconist.

Let’s see, how should one phrase this sort of thing? Restraint of trade comes to mind. Restricting freedom of choice comes to mind. Loss of choice, loss of freedom, living in a bizarro world, this is no longer America, also come to mind.

If you have been on another planet for the past few years, it might come as a shock to find out that tobacco in the United States and the world is under siege, if not full blown attack.

Antis across the globe are out to kick tobacco into the dustbin of history.

And this comes at a time when states, cities, towns are desperate for money to balance battered budgets.

Well, here is a news flash for the antis, who might be feeling the squeeze of higher prices at the gas pump, higher prices in the grocery stores, clothing stores, etc., etc.: you kill tobacco, and you haven’t seen nothing yet concerning price hikes.

Count on it. And, by the way, you won’t ever get rid of tobacco. It will be around on a black market forever, depriving states, cities and towns any revenue from it. Count on it. No one, and I mean no one, I know is going to give up their pipes and pipe smoking just because the federal government says we have to.

Here’s why: Raise your hands those of you who trust your federal government and its agencies to tell you the truth about anything!

The Antis can take that one to the bank. Or put it in their pipes and smoke it!

I suppose most of you have heard of the Southern part of America and its fascinating association with illegal whisky. You will also note that in the South, we still purchase same.

You will have a similar arrangement with tobacco if the antis win. This, too, will deprive states, cities and towns of even more tax revenue.

Check out Godbee’s piece and another post about Florida banning smokers in the great outdoors here.

Talk the Talk, Walk the Walk

 Well, here is how it is on Jan. 10, 2011, in Whiteout Tennessee: the Brits think smoking will be over in 30 to 50 years.

For all you youngsters out there who are Brothers of the Briar, now would be a good time to harvest all the bulk and tobacco tins you can and store them in a nice, dry, humidity-correct, place with a lock.

If you believe the Brits, and I do not, then my only advice for you old-timers, is to just keep on puffing away. Maybe the British economist will go away.

And remember the best advice of all (with apologies to Willie Nelson):there are more old pipesmokers than there are old economists.

In case you missed the last big splash of British news last week, some English whip-de-do-whizz-bang economist noticed that tobacco stock prices have been falling on the British Stock Exchange.

He read into this that the sky is falling in on tobacco and that “if” the trend continues, then in 30 to 50 years, there might not be any smokers left Great Britain.

That’s from Citigroup analyst Adam Spielman in London. He’s from another planet, doncha know?

 ”The data used by Citigroup shows that the percentage of adults in the UK smoking has dropped to 21 percent in 2008 from 53 percent in 1960. And there has been a steady decline
in smoking in most other developed nations.”

This investment bank nerd sees smoking in Great Britain as zeroing out in the next three to five decades. There may not even be a Great Britain in the next 50 years, bub. Put that in your pipe and smoke it.

Hey, that’s in the ballpark, though, give or take a decade. You can count on that, sure.

Let’s see if I got this right from the worldview:

  • Smoking cigarettes has declined worldwide. Check.
  • Tobacco sales decline and are under siege by the U.S. and other governments. Check.
  • Great Britain is putting its mom-and-pop pubs out of business by outlawing smoking in public buildings. Check.
  • The United States is attempting to outlaw smoking even in the Great Outdoors, even though it doesn’t own (yet) the air we breathe. Check.
  • Crooked U.S. politicians are attempting to increase taxes on tobacco to extreme prices to eliminate the market. Check (note: but carrying a loaded pistol into an American bar where alcohol is being served is legal in many states; yeah, that makes sense).

OK. I suppose I’m getting the picture. Governments and politicians just don’t like tobacco. However, they sure like the tax revenue off tobacco. It helps them pay for their Cadillac-health care services while cutting it back for the rest of us.

Oh, and yes, they do like their premium cigars. Or, heck, you might even catch the U.S. President Barrack Obama sneaking a smoke now and again. No hypocrisy in that, eh, what?

Here is what I am getting at in all this: Let’s not complain down the road when the well runs dry on excise taxes and tobacco does zero out, perhaps. That’s for all the governments that depend upon tobacco taxes to help balance budgets. That 400,000 deaths the antis complain about and the “billions” lost in wages and production due to tobacco each year will be a milk run should the wheels completely fly off the tobacco wagon. You will see wholesale movement to the black market, deaths, robberies, and a tremendous decrease in tax revenue to the point that today’s budget worries will look relatively tame.

And, as for predictions that have a leap of time somewhere around 20 to 30 years, well, I don’t think so. A lot can and does happen in a day. Given a decade is almost geologic time.

And let’s not complainwhen politicians speak out of both sides of their many mouths about what is good for the nation, while reaping big benefits from taxes from tobacco, and at the same time, smoking tobacco products. We need to “tell it like it is,” a la Howard Cosell. Politicians and anyone else who professes a holier than thou attitude in public and then heads out to the country club or men’s club for a cigar must be held accountable.

If you are going to talk the talk, you need to walk the walk.Pipe Icon

Stakeholders Meeting Set

Just in case you are interested and can make the session, the feds are having another one of their stakeholder gatherings for another set of studies to bind up in notebooks and place on the shelf:

Tobacco Manufacturers and Growers Stakeholder Discussion December 8, 2010

The U.S. Food and Drug Administration (FDA) Center for Tobacco Products (CTP) will hold its second Stakeholder Discussion Series session with Tobacco Manufacturers and Growers from 9 a.m. to 5:30 p.m. on Wednesday, Dec. 8, 2010 at: Raleigh Marriott City Center,  500 Fayetteville St. ,Raleigh, N.C., 27601.