Thursday, February 28, 2013

Dumb and Dumber







"Some people's capacity to do dumb things knows no boundries"


Every time I think I have seen it all, someone comes from the shadows and proves once again, that dumb can rule the day! What is it this time? In Minnesota, the party of "if it moves, tax it", wants to increase the tax on liqour by a substantial amount. So what? The increase can't be that much. We can absorb that by just cutting back on something else. Hold on folks - here is how much of an increase is in the proposal:

Spirits
Current: $5.03 per gallon Proposed: $17.82 per gallon

Wine
Current: $.95 per gallon Proposed: $8.24 per gallon

Beer
Current: $2.40 per 31-gallon barrel Proposed: $13.97 per 31-gallon barrel

No, this is no joke. I think (I am not sure) the plan is to make liquor so expensive that people will just quit drinking. This might be a preview of what life under ObamaCare will be like. Here is a news flash for the one who thought this up and proposed it - people are going to continue to drink - only not in Minnesota. People will go accross the border and buy larger quantities of liqour to bring back home. It will be like the 4th of July when folks drive to the Dakotas to buy Black Cats. The net result for Minnesota will be this: 1) People will continue to drink and 2) Minnesota will lose, not gain, tax revenue.

Minnesota needs to learn from California. For years now, California has been targeting the rich to pay more taxes. Guess what? Thousands of wealthy people have left California and moved to lower taxed states. The result for California? A shrinking tax base with huge deficits that come and go. In a state which is fiancially so volitile, long term planning is almost impossible.
One more thing. Another deep thinker wants to charge $3 each round trip over the new Stillwater bridge. Guess what will happen next? Rather than paying $15/week to go over the bridge, people will continue to use the same detour through small towns just to get over the river. When this bridge was proposed, NOBODY said anything about a toll.

The lesson to be learned is this. People don't have to pay high taxes. If you charge someone too high of a rate because of his or her earnings, that person does not have to produce as much the next year. If you have a high consumption tax, people don't have to consume as much. If you charge to go over a bridge, people will go around it. If you make it too expensive to live somewhere, people can move to a cheaper location.

Using the tax system for social engineering or as a weapon is not only bad policy, it is dumb. Not only dumb, but dumb and dumber.
 

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