Rebirth of Reason


Espresso Tax and the Hidden Costs
by Tibor R. Machan

News reports had it the other day that Seattle's politicians and bureaucrats have cooked up yet another extortion scheme. They are now planning to put a 10 cent tax on every shot of espresso coffee. No, regular coffee, which is drunk by nearly everyone, will not be taxed - one may assume opposition to that would be too costly for the Seattle extortionists. But espresso coffee, which is drunk by fewer folks who probably will not bother to organize any serious opposition since they have better things to do with their time, will get the axe.

Now why is this of any significance? After all, such schemes have been the norm ever since taxation was invented in the ancient feudal eras and, in America, ever since politicians have managed to hoodwink the public into voting in the income tax, which pretty much opened the floodgates so there's no principled way to stop a tax. What is interesting about the Seattle extortion scheme is how some journalists - in this instance the CBS radio correspondent who reported the item midday August 25th - have become naively or consciously complicit in perpetrating it.

After reporting the plan, this particular CBS network radio anchor mentioned that the ten cent tax on espresso coffee will produce various wonderful public projects, such as child care facilities, in greater Seattle. Thus the reporter managed to provide a boost to the idea, mentioning only that the extorted funds will be very helpful to some needy people in the city.

What about the millions of folks who will be the victims of the extortion? Did the CBS anchor say anything about what the loss of millions of dollars will do to other projects, ones that might have been funded by espresso coffee drinkers? Of course not, proving, once again, the insight of Frederick Bastiat, the 19th century French political economist who wrote "That which is seen, that which is not seen," the essay which explains how because political projects get a lot of visibility, their costs tend to be largely unreported, even unnoticed. Our CBS radio network anchor's conduct is a typical instance of Bastiat's point.

Of course, there is something else amiss with the CBS anchor's conduct - it is entirely unprofessional. By reporting only on what the proposed espresso tax is partially going to produce - and only "partially" because, after all, the taxation process will also eat up a good deal of the funds obtained - this rather prominent CBS journalist was exhibiting an undeniable bias. It is just this bias that many journalists - especially at CBS, the target of the expose book, Bias (Perennial, 2002), by Bernard Goldberg - are contesting. Yet here is an instance of it that stares us in the face.

Of course, the CBS anchor would claim that he was merely reporting what the politicians claimed. Yet, why was he not reporting what critics of the tax claimed?

Taxes, as all extorted funds, not only take resources from projects taxpayers would prefer as against what the politicians prefer. But they also increase the control of politicians and decrease that of citizens. That, indeed, is the point of trying to keep one's funds under one's own control - not greed, not meanness, not lack of compassion, not stinginess. It is to be in the position to provide the direction to one's resources, whatever that direction may be.

The ten cents robbed from espresso consumers in Seattle - and the billions of dollars from the American public - by politicians and bureaucrats might have been left to those who own those funds to use and dispose for various projects, be these personal, familiar, social, religions, philanthropic, or recreational. The central point though is that it would have been the owners of the resources who decided what use is made of them, not the politicians and bureaucrats.

And that is just what makes taxes so important to those politicians and bureaucrats - the more taxes there are, the more power they have!

Sanctions: 2 Sanction this ArticleEditMark as your favorite article

Discuss this Article (3 messages)