Tobacco tax: It's going to be way too close

06.05.12 - 10:01 pm | Tim Redmond |

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About 25 percent of the vote in. 50.6 Yes, 49.4 No. Trending the wrong way. This is going to be very close.

I didn't believe that the tobacco companies could beat this thing, and I thought the results from LA would push the Yes vote, but in LA county, Prop. 29 is losing. Odd to see the absentees more liberal than the election-day votes, but let's remember: As the polls showed this getting closer, Big Tobacco threw more and more money into the strategic areas, and that's clearly had an impact.

Wow. This could actually go down.

And if Californians aren't going to tax cigarettes, which only about 12 percent of Californians even smoke, what does that say about the impact a big-money campaign could have against Gov. Brown's tax measures in the fall?

Election June 2012

Comments

Meh. Wouldn't read too much into it. I voted NO

There were a lot of reasons to vote against it.
-It's a "sin tax," and I never liked the whole concept of sin taxes.
-It's regressive. It's all regressive. There's nothing progressive in it (now if they'd actually have the guts to tax tobacco companies themselves, that might have been different).
-It was picking on a minority group, in this case smokers. The only reason it even got this far is because 85% of people don't smoke. Never liked the whole bullying aspect of it either.
-It was just plain excessive. The big majority of a pack of cigarettes goes to taxes anyway. Another dollar a pack or whatever is just plain punitive.

None of these reasons apply to the Brown tax initiative.

I don't smoke, but to me it's about freedom to do with your own body whatever the hell you want to do. Even if it's unhealthy. Adults should have the right to do unhealthy things if that's what they want to do.

And yeah, the whole big spending by Big Tobacco left a bad taste in my mouth. Almost made me want to vote Yes out of spite. But in the end I held firm and voted No.

Posted by Greg on Jun. 05, 2012 @ 10:34 pm

The money's the point

I get it, Greg. The point here is that this thing was polling about 65 percent before the tobacco money poured in with the wildly misleading ads. So my comment is this: If big money can sway something that starts off as popular as this, then Jerry and Company could be in for a serious fight if corporate money decides to attack his tax plan. Unless he goes out and raises a bunch himself to fight it -- but it's hard to come up with $50 million unless you are corporate America.

Posted by tim on Jun. 05, 2012 @ 10:43 pm

But Tim, those ad's were informative.

For instance, I didn't know that the money would not be spent in California. Taxing Californians to invest in jobs in other states made no sense to me.

And on one of the very few occasions that I will ever agree with Greg, I don't like narrowly-based regressive taxes.

So with an alliance of a libertarian like me and a hopeless lefty like Greg, you can see why there was a strong "no" vote on this.

Posted by Guest on Jun. 06, 2012 @ 5:48 am

Lessons for liberals

The ads were one-sided and misleading. It's a perversion of democracy to let one side dominate the debate.

But there are lessons here. If you're going to try to craft a tax measure, forget about trying to get corporate America on your side. There's nothing you can do to get them to like you more. The amount of money they can spend is infinite, so if they decide to fight you they will spend whatever it takes. Might as well go for the jugular. If they had a direct tax on tobacco companies rather than on working class individual smokers, the tobacco companies would not have tried any harder than they already did. But some of the smokers who voted against this 3-1 might have actually gone the other way, and it could've made the difference.

Same principle with the November tax measure. The tax on millionaires to fund schools was the right idea. A progressive tax on those who could afford it most. Sadly, Jerry Brown already fucked that up. Hopefully not completely, but we'll see.

All in all though, it's tough to get anything decent passed until you get big money out of politics.

Posted by Greg on Jun. 06, 2012 @ 7:49 am

But Greg, you said you dislike "narrow" taxes

It's narrow to tax just corporations, or just millionaires.

And there is no such thing as a corporate tax. To preserve their profit margins, they simply pass on that cost anyway. Corporations are just conduits - you ultimately cannot tax them without taxing their customers.

But I agree with your idea that wealthy liberals shouldn't be able to outspend poor conservatives. Or isn't that what you meant . . . ?

Posted by Guest on Jun. 06, 2012 @ 8:41 am

Corporations do not "simply

Corporations do not "simply pass that cost on anyway." If a corporation could raise its price, they would do so and pocket the difference.

Taxes ultimately eat into the profitability of a corporation. If they eat away enough the corporation goes bankrupt.

You really have to be clueless about economics to believe that a business can just pass on its costs.

Posted by Troll666 on Jun. 06, 2012 @ 1:52 pm

So, 666, you want to tax corporations into bankruptcy?

And then where do you get your taxes from?

No, everyone knows that increased costs gets passed through. It's called inflation. You've heard of that, right?

Posted by Guest on Jun. 06, 2012 @ 2:08 pm

Do I sense some disagreement among corporate capitalist factions

"Corporations can't simply pass on taxes. They'll go bankrupt!!! Oh Noez!"
"Taxing corporations is useless, because they'll only pass on the costs anyways, so lets not tax anyone."

Yep, in a nutshell you guys encapsulated two of the most common talking points of the corporate right, and in a nutshell you've demonstrated the self-contradictory idiocy of said talking points.

Truth is, corporations will always do their very best to pass on every cost possible, in the same way that they do their very best to squeeze every last dime from their customers (and every last drop of sweat and blood from their workers).

But there's a limit. You can't pass on everything. And sometimes a competitor will arise to undercut you if you go hog wild. Corporations can still get away with some serious price gouging because of collusion, class solidarity, and underhanded methods to stamp out legitimate competitors. But still, there's a limit.

And if taxes are confiscatory, they could, in theory, in some other universe, lead to bankruptcy. But let's not forget that taxes are levied on PROFITS... in other words, on the EXCESS. So in America, taxes don't cause companies to go bankrupt. And as a former business owner myself, I know that there are gazillions of ways to look poor when in fact you're raking it in. And they're legal because the tax code was written by criminals.

PS... I never said I didn't like "narrow" taxes. I'm just fine and peachy with "narrow" taxes, as long as they're progressive. Millionaires can afford it. Poor people can't.

Posted by Greg on Jun. 06, 2012 @ 8:04 pm

Why I voted no

I voted no.

It is another earmark that will suck tax revenue into a specific bracket, leaving the legislature with less money for other causes.

Posted by Guest on Jun. 06, 2012 @ 6:57 am

Good!

I voted no and I neither smoke nor am an opponent of most taxes. I voted no because I hate sin taxes - a terrible vestige of our puritan morality. Liquor and cigarettes should not be taxed higher because some people morally disapprove of them.

Posted by Troll II on Jun. 06, 2012 @ 10:31 am

I did not vote on this

I did not vote on this measure because although I support taxing tobacco, I am not inclined to give one more red cent in tax increases to Ed Lee, Jerry Brown or Barack Obama because they will do nothing with those dollars except funnel it to the 1% to make them stronger and screw the 99%.

Until the corruption stops, no more money.

Posted by marcos on Jun. 06, 2012 @ 10:53 am

Marcos, for once you and I agree, although my reason for

voting "No" on all tax increases is that it will all go to public sector workers and unions.

Posted by Guest on Jun. 06, 2012 @ 10:55 am

If the tax dollars went to

If the tax dollars went to employ people then that would okay by me. The problem is that these new dollars would go out as contracts to the politically connected, the 1%, because they all hate on public sector employees because their unions are perceived almost universally as more of the problem than the solution..

Posted by marcos on Jun. 06, 2012 @ 11:46 am

Public sectors unions are perceived as the problem because they

are the problem. The huge unfunded pension liabilities that have been accrued ensure that any new tax dollars go not to provide jobs and services, but simply get swallowed up in the black hole that is unaffordable pension obligations.

The days of simply throwing money at city workers is over, and the voters won't tolerate backsliding on that.

Posted by Guest on Jun. 06, 2012 @ 12:00 pm

Only 4% of state spending

Only 4% of state spending goes to pensions. It is a bogeyman created to scare uninformed people like you.

Posted by Troll666 on Jun. 06, 2012 @ 1:53 pm

Only 4% is spent because of the massive underfunding.

If the true eventual cost of pensions were paid for now, it would be crippling, which is why the pols keep kicking the can into the long grass.

Public sector pensions cost three times private sector pensions. You think that's not a problem?

Posted by Guest on Jun. 06, 2012 @ 2:10 pm

That's now, but as the boomers retire, it will

grow exponentially. That's why it's such a problem, and we're not planning for it.

Posted by Guest on Dec. 04, 2012 @ 4:09 am

I didn't know this was Don Perata's baby

I heard Don Perata defending his initiative on KPFA today. Apparently he wrote the initiative and it's been his project for the last five years.

Shit, I didn't even know Don Perata was involved in it. Had I known, I would've made sure my in-laws cast their ballots and voted NO as well. Anyway, he was saying "think of it as a user fee. If you don't smoke, then you don't pay it. If you smoke then pay up, because you're costing the state money."
GAWD what an asshole! That is exactly the WRONG way to fund stuff. This pretty much encapsulates the whole Conserva-Dem mindset. Every man for himself. User fees. What's the difference between that and a Republican?

My philosophy is that we all do dangerous, stupid, and unhealthy things at one time or another. Some of us more than others, but that's OK. We still live in a community. And in a civilized community we pull together and take care of each other. People use the health care that they need to use, and everybody pays for it. Those who can afford to pay more, are taxed in proportion to what they can afford. That's what a civilized society does. That's what a progressive believes in. Not "user fees" for things like research and health care.

Isn't that right, Tim?

Posted by Greg on Jun. 06, 2012 @ 8:16 pm

I do not believe in “sin tax”

I do not believe in “sin tax” too, even though the money collected can be spent on funding research or on smoke reduction programs.. I believe there are other ways of promoting healthier, smoke-free living. Also, we should not discount the many alternatives available today, such as nicotine patch and green smoking. These alternatives to the traditional way of smoking actually work.

Posted by Gabriel Macy on Dec. 03, 2012 @ 11:47 pm