A few days ago, I wrote the post about John Cramer, Guinness, and the fight against new taxes and bad economic policy. One of the friends of this blog (specific names are being left out of this as no permission was granted to share this conversation) wrote to one of his representatives about this very issue. What he received in response was a missive from la la land--a note about how even in these rough times a tax increase can be a necessary and good thing.

Before going forward, I have to say this unequivocally: in an economic climate like this, punishing the successful, the creative, the investors, and the very people and organizations that provide jobs and opportunities for Americans by raising their taxes is foolish. Raising taxes in ways that hurt the working class and limit their ability to make purchases is just as misguided. That some of the taxes that have been floated (especially raising or eliminating the Social Security tax cap) would move tremendous amounts of capital from the private sector to the US government to be used to offset the excesses of a dubious stimulus package makes me cringe. If the ultimate goal is to cripple the private sector, then this should definitely do the trick.

And that much of those tax increases are done for such high-minded reasons doesn’t change the fact that they will be harmful--and it irritates me that our elected officials continue to trot out one cause after another in an attempt to convince me that these things that will drag our economy down will actually act in some miraculous fashion to solve our current woes. They won’t, the money will be wasted, and the bureaucratic structures built to support the new and expanded programs will only suck more and more money out of the private sector, distort economic realities, and make it harder for companies (especially the small companies) to do business. None of that is good for jobs or our current crop of economic failures.

What we are talking about here--a small, new tax on alcohol--isn’t big in the context of our larger economic problems or even in the context of most states’ budgetary shortfalls. It feels like a little thing, but in taxes and budgets, a bunch of little things sooner or later add up to some really big numbers. In this case, those numbers just mean more drag on the economy and the possibility of job losses and failing businesses.

So when Mr. Representative trots out the public good by noting that the state pays for the sins of alcohol consumption and that new taxes will help defray those costs, I find myself feeling that little itch behind my ears that tells me that someone’s lying.

For instance, the Guinness site notes--and, in a depressing display of cynicism, I do believe the Guinness site to be a touch more honest than the typical US Senator or Representative--that taxes on beer and wine currently amount to 41% of the beverage’s retail price and that 59% of the cost of spirits (that booze to you and me) is in taxes. That figure on spirits is roughly supported by this article from US News & World Report, and my guess is that unraveling the trail of fees and taxes on every barrel, bottle, or glass of booze would be a tricky task, indeed. Point being, though, that I think most people would agree that if a compensatory tax were needed for losses incurred by government agencies for their constituents’ overindulgince in alcohol, that tax is already being paid.

Alcohol, like cigarettes, is a great target of opportunity, though. It’s easy to demonize and some puritanical folks are more than willing to buy into any argument that starts with, “Let’s talk about the evils of alcohol...” Unfortunately for the taxers, the public attitude towards drinking isn’t nearly as solidified as the public attitude towards Big Tobacco and recent attempts to raise taxes on alcohol continue to fail. Americans, bless us, still love to tip the bottle on occasion and don’t see the need to make the cost of our drinking any more onerous that it might already be.

So, no, sir, no new taxes for us.

I will, however, say that this particular representative deserves some level of credit for his response. My own emails and letters to my senators and representatives are rarely answered by anything other than form letters or form emails. Sometimes they even ignore in totality the subject of my letters. This gentleman not only answered the substance of the original message, but he gave his phone number in return and gave a reason (a reason I didn’t like, admittedly, but a reason) for his support of those new taxes. Good for him for at least engaging his constituents instead of simply ignoring the stuff he doesn’t like.

H/T to The Source