Milking a Dry Cash Cow
August 25th 2011 Posted at Breaking News, General News, Tobacco Politics
2 Comments
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.



