“Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
As usual, Ronald Reagan hit the bulls eye, and 2014 has already seen two out of those three realities come to pass in one of the nation’s newest growth industries – e-cigarettes.
Why the focus on e-cigs? Because when you combine what they are and their growing popularity with how the government has reacted to them, it represents not only the embodiment of Reagan’s statement, but a revealing insight into what the left values above all else.
Faced with the choice of health and safety or revenue and regulation, it seems more and more governments at all levels are choosing – you guessed it – revenue and regulation.
Allow me to explain such a bold statement. A virtual jihad against e-cigarettes has continued apace. The reason the term jihad is appropriate is that the various campaigns to tax and regulate e-cigs are essentially articles of faith, unsupported by science, to the detriment of public health, and resulting in more money and power accumulating in the hands of politicians and bureaucrats, and away from civil society.
First, some history, and there is a lot of it when it comes to tobacco and the federal government. The feds started taxing and regulating tobacco in the Republic’s earliest days – Alexander Hamilton’s tax package of 1794 proposed the first federal excise taxes on tobacco products. It was quickly shot down, but politicians would eventually succeed and continuously go back to that well to fund their various dreams and schemes, arguing that such taxation and regulation is a relatively painless way of relieving the citizenry of their hard earned money.
By 1880, almost a third of every federal tax dollar collected came from tobacco taxes. Of course, a third of all revenues in 1880 was – wait for it – less than 40 million dollars! But the feds have been after smokers’ money for a long time, and it is not hard to figure out why. The federal government collects $1.01 per pack, and at more than 82 million packs sold in an average day, that it adds up to real money, even in 2014, even when the federal budget is more than 30 times larger than in 1880.
Tobacco taxes also happen to hit the poorest the hardest. In 1794, James Madison said “Tobacco excise was a burden the most unequal. It fell upon the poor, upon the sailors, day-laborers, and other people of these classes, while the rich will often escape it.”
Apparently this reality does not matter much to bleeding heart leftists when helping the poor would decrease both tax revenues for these politicians to spend and regulations that give them more control over our lives.
Of course, the states and local governments are in on the action, with the jurisdictions that are high tax in other areas showing the same propensity with tobacco. The result is that smokers in high tax states – New York has the highest tobacco tax, Virginia the lowest – are buying their cigarettes in low tax states. This is much to the chagrin of New York Governor Andrew Cuomo, whose response has been to form a task force to keep illegal cigarettes out of the Empire State.
But when cigarettes cost on average almost $9 a pack less in Virginia than New York, only a politician could believe a task force will prevent robust interstate tobacco commerce.
The current taxing and regulating regime around cigarettes and smoking is justified by the notion that there is a great public cost incurred by the state and society due to smoking. The story goes that smokers are unhealthy, consume many more public health resources because of their sicknesses, and as such should bear the burden through high taxes on cigarettes. The story sounds true, but happens to be pure fiction. Simply put, smokers get sick and die faster and earlier than non-smokers, and thus require less health care late in life while also consuming less Social Security and Medicare dollars.
E-cigs were invented to counter the many dangers of smoking, The vaporized solution is infinitely safer to inhale than smoke from burning tobacco. One of the only credible studies done on the solution showed “no health concerns based on generally accepted exposure limits.” So you would think public-minded politicians would want people to transition from the deadly smoking to the relatively harmless vaping. And you would be wrong.
See, the government has a problem. Nicotine solution has no excise tax like tobacco. The federal, state, and local governments’ pocketbooks are hit hard when someone switches from smoking tobacco to using a vaporizer. So city, state, and local governments across the country are lining up to restrict and ban e-cigs.
Are they trying to protect the profits they make from traditional tobacco sales? Well, follow the money.
Despite scare stories by the New York Times and others, none of which contain either negative scientific data about e-cigs or documented cases of people getting sick from them, the fact is that nicotine is not very dangerous at all.
Every once in a while, an issue arises that forces politicians to choose between conflicting beliefs and constituencies. For example, the Keystone Pipeline issue forced the left to side either with unions or environmentalists. The use of drones forced them to choose between a low-risk strategy on national security and an intolerance for aggressive military measures.
But no choice can be quite as stark as the one between public health and money. And no matter whether they protest that it is not their intention, it seems clear the forces of big government have chosen the latter.
