Beer Today, Gone Tomorrow
Ask almost anyone under 30 about their politics, and chances are that they will confess to being basically apathetic on most issues. Young Oregonians no longer have that luxury, as our legislature now seems poised to destroy all that is great about the state of Oregon. Let’s face it: the reason most of us get through the long, rainy winters, the reason we are able to put up with endless hippe drivel is Oregon’s abundance of high-quality, reasonably priced microbrews. Indeed, if Oregon has a single global claim to fame, it is as the microbrew center of the world, a mecca for all things hoppy, malty and alcoholic. Enter the dour killjoys…
The Register-Guard’s cover story today tells us that Oregon’s delightfully low beer tax of about 3/4 of a penny per 12 oz glass is likely to increase soon to the highest level in the nation, thanks to the new Democratic majority in the state legistlature. And it’s not just going up a little bit either, thanks to state Senator Bill Morrissette (D-Sprfld) who “is working on a draft bill to increase the Oregon beer tax to a total of about 10.5 cents per 12 oz. glass” according to the RG story. Rep. Jackie Dingfelder (D-Portland) is also quoted as saying “To me, it’s at the top of the list of things to do this time.” Talk about getting your legislative priorities straight.
The justifications for this move seems to be first, that more money needs to be spent on alcohol abuse prevention, and second that the beer tax is simply low in comparison to other alcohol taxes. Former OLCC director Pam Erickson tells us that the wine tax is about average compared to other states, and that the “sale of hard liquor in state-controlled stores generates a reasonable amount of money for the state through markups” but that “the existing beer tax is so low, it’s almost not worth collecting.” Aw, how tragic. Maybe the state’s world-class beer industry would be worthwhile to the legislature if it became a state-managed monopoly just like hard booze… wouldn’t that show Oregon’s micro-death merchants the meaning of responsible citizenship.
Although there is a clause in the proposal that would exempt breweries that produce less than 200,000 barrels per year from the new tax, established not-quite-micros like Widmer and Deschutes produce enough to potentially get hit hard. Ultimately, Oregon microbreweries are some of the most vibrant businesses in our economy, and have huge potential for continued growth, especially in exports. In a globalizing economy, our state needs to recognize that products such as microbrews and Oregon pinot noir are as much part of Oregon’s international branding as timber, salmon and seasonal affective disorder. We urge our state leaders to reject this unnecessary, regressive and short-sighted tax, and rather to celebrate the economic and other benefits of Oregon’s status as one of the world’s premier brewing regions.
Free Kool-Aid for everyone!
TO ARMS TO ARMS!
Hey, dudes, I’m a minarchist…Andy’s the crazy anarcho-capitalist. I am, however, thinking that the blog is in need of some sort of lefty exorcism:
THE POWER OF MILL COMPELS YOU, THE POWER OF MILL COMPELS YOU!
We start talking about beer, and look where it ends up.
You’re right, Andy… people would be much better off without government. Who’s up for the Revolution?
Anyone?
You have many arguments there, but let me counter by saying why is there the greatest number of crippled and disabled people living in the US? The reason for both the min wage and the previous example is that we are wealthiest people ever in the history of the world, so the labor that is stolen through taxation isn’t missed as much (marginal benefits).
Here is an example. Say there are 10 workers making a total of $1000/mo equally between them. Now lets say they make min wage of $10 (each work 10 hours) and it increases by 10%. Now the business owner sells something with a price elasticity of greater than 1, like most businesses do. The wage increase cannot be passed on to the consumer. If the business was perfectly competitive, an increase of 10% in wages yields a decrease of 10% labor purchased. So how does that help poor people? What min wage laws do is transfer income from those who become unemployed to those who still have a job.
Do you like it because it sounds good? You feel good when you say people should make more money? I want people to make more money too, but I refuse to use violence to make that happen. And it is laws and violence that destroy wealth creation.
Please tell me you didn’t actually just not scare quote “solve poverty”.
Please tell me you didn’t actually just scare-quote “free market”.
“Any economist worth their salt understands the limitations inherent in using abstract models to understand something as dynamic and unpredictable as economic activity
Easy, Andy.
You are right, democracy doesn’t always make the “right choice.” What the 40-some percent of Americans who vote want often flies in the face of common sense, let alone economic theory.
Tell you what. Why don’t you show me the one country that has never had a minimum wage where you would most like to live and work. Put differently, why do the largest economies all have minimum wages? Why is there no great historical example of a “free market” benevolently ordering society without the active participation of government? Any economist worth their salt understands the limitations inherent in using abstract models to understand something as dynamic and unpredictable as economic activity… just as any political scientist worth their salt understands the difference between critical discourse and propaganda.
What are you talking about Ted?
Every state has passed a CONSTITUTIONAL ban on gay marriage. What don’t they get?
If the real point is there might not be a min wage, then isn’t that a good point? Yes, that is the point – all current economic research says that min wage does not help the poor, so if it doesn’t achieve its own goal, why keep it?
Dang those greedy capitalists stealing all the money! They are hiding it in their bellies…we must go cut it out of them and spread the money to the proletariat and when everyone has everything they need that was stolen from them, we will live in eternal bliss.
As Alfred Nock says, “You can’t tell someone something they don’t already ‘know’.”
“Commerce Department data released on September 28 show that in the first half of 2006, the share of national income that went to wages and salaries was at the lowest level on record, with data going back to 1929.”
http://www.cbpp.org/8-31-06inc.htm
“the average workweek for all minimum wage workers was less than 10 hours in 1998.”
Surely this doesn’t account for the common practice of having multiple part-time jobs… I haven’t yet found a number that tells me how many jobs the average part-time employee has.
“Minimum wages curb employer-provided training opportunities for low-wage workers and may reduce educational attainment for some at-risk groups.”
Huh? So this means that the basic 7-11 training is going to make you want to drop out of school? “Well, I guess now that I know how to make the Slurpy machine work, I’m on easy street… guess I’ll drop out of community college.” Oh, and the “may-for some at risk groups” language is not wildly convincing.
At the end of the day, your only real point is that there might as well not be a minimum wage. If this is such a great idea, why are all the states passing increases? What don’t they get?
I’ll keep in mind that pesky facts (such as most people earning minimum wage being recent immigrants or young) are “prejudiced and unfounded”. Never mind the data (from the above-linked Asymmetrical Info post, emphasis mine):
It’s funny that would shouldn’t focus on the economic/academic reasons not to raise the min wage it’s clearly economic and we would want the government to have academically sound actions right?
You’re right you’re not going to win this argument, because it’s a failure and the min wage has been disproven to help the poor increase their income. What if all I did was post on this blog all day, and I worked really hard at it and I searched youtube for funny clips for everyone but alas, made not a dime? Sure, many think I may “deserve” to be compensated, but it’s clear that no one would feel that my services warrant compensation if no one contributed anything to me.
You tell me santorum, what should the min wage be? If a higher min wage is better in your unsupportable opinion, how high? $10/hr? $50/hr? Why not? More is better right? What criteria do you use to know that the min wage is too high, let alone too low?
“And if you can find me somebody earning $5.15 an hour at a Nashville Taco Bell who is 1) English-speaking 2) Literate and 3) Over the age of 25, I
I made $5.15 per hour a while ago, and I lived fine. It’s people like “The Santorum” who can’t get off their fat asses and actually try to find a job worth while.
He needs to go pick berries. Displace some illegal aliens.
So the real Rick Santorum lives in Portland. That’s interesting …
Continue …
Will a small increase in the minimum wage cause catastrophic problems across the economy? Probably not. Will it cause some middle class teenagers and some poor, unskilled folks to not have jobs anymore? Some, but small increases will have small effects.
If the minimum wage is below the going market rate (which in many cases it is) the thing constitutes a useless price floor, so what’s the point of having it? And, really, you’re going to have to raise it a hell of a lot [PDF, Pg 5] to make it a generally effective price floor [insert usual disclaimers and caveats here].
The other issue is that it’s a remarkably bad poverty fighting tool, being that the vast majority of people earning the minimum wage are not supporting themselves on it: they’re mostly middle class teenagers, so they reap most of the gains from any increase. The EITC is a much better poverty fighting tool, so if fighting poverty is your concern expansion of the EITC is a much, much better place to start. I’ve long been in favor of Megan McArdle’s tax plan. Negative income tax for the working poor, zeroing out around $30k a year, eliminate all other income subsidies, eliminate all tax deductions. If you want to agitate that the government has a duty to help those without much human capital, fine, but a higher minimum wage isn’t really a good way to achieve your stated goal.
And if you can find me somebody earning $5.15 an hour at a Nashville Taco Bell who is 1) English-speaking 2) Literate and 3) Over the age of 25, I’ll be pretty surprised.
Well, kids were never apart of the equation.
I know I can’t win this argument, especially in this forum but still I’ll plug away.
Arguments against raising the minimum wage, universal health care, and other federally funded benefits to the poor always seem to come from the people who don’t need them. Show me someone making $5.15 an hour in Nashville Taco Bell that will agree with your statements, Timothy.
We should at least be able to agree that the federal minimum wage isn’t keeping up with inflation, making it tougher to live on $5.15 an hour than it was, oh, 1997 when it was last raised. I’ll bite: what practical reason is there *not* to kick it up to at least $6?
Don’t forget about the wonderful opportunties available in the distribution of narcotics.
If you’re earning minimum wage you shouldn’t reproduce (because you probably can’t afford it), if you’re dumb enough to that’s on you. But, aside from that.
1) Have a roommate or two to diffuse the cost of living.
2) Cancel my cable and internet.
3) Work more than 40 hours a week.
4) Try to find a better job in the time I have.
Although I find it interesting that you’re more interested in emotive arguments about how hard it is for some people (and hey, it is) than you are about the arguments over whether or not a higher minimum wage actually helps the people it purports to help, whether it’s actually an effective anti-poverty tool or not, etc.
Does anybody have the obligation to pay you more than your unskilled/non-loyal ass deserves?
Should have said generates instead of deserves.
If you find yourself working for $5.15 p/h and struggling to make it, how productive are you? Is your “work” generating enough money to cover your salary/overhead/supplies/insurance? Does anybody have the obligation to pay you more than your unskilled/non-loyal ass deserves? I’d say no most of the time, however I do accept that unscrupulous investors and business owners often undervalue the profit their minimum wage workers generate. Owners have a moral obligation to provide a fair wage to their loyal employees and most do. Mandating the value of unskilled labor doesn’t actually relate to an increase in production or profit and doesn’t benefit somebody who can’t produce “a living wage” for whatever reason.
Santorum I know things are tough but I’m sure a former senator like yourself could find a job for at least $7 p/h.
“If you can last six months on the federal minimum without outside support I
No, I’ll spare you that. I’m interested in the nitty-gritty realities of the federal minimum wage, not the economic/academic view. Spare me your ivory tower/”let them eat cake” stance on the issue and answer me this: if you found yourself working 40 hours a week for $5.15 an hour, do you think you could pull it off and how would you do it? If prices go up, making life harder for people in this bracket, shouldn’t their wages go up too?
Yes, I’ll get right on quitting my much more lucrative job so I can satisfy your driving need to prove some sort of point.
What’s the point? That the 25% of minimum wage workers who try to support themselves on it have kind of a rough time? We know that, it’s bleedingly obvious, but raising the minimum wage emphatically does not help them unless you think demand for low-skilled labor is vertical which it emphatically isn’t.
Can we skip to the part where you break out that old Card & Krueger study and I go on and point out that it was based on surveys and otherwise problematic? Do you want to initiate the argument about the duties of the state or shall I?
To be fair, they would be the most “efficient” six months of your life…
…who
It appears that something Sir Oliver was referencing has mysteriously disappeared from a comment…curiouser and curiouser.
Why, Olly, I’m quite sure I don’t understand what you’re talking about…
“PS – that was tongue in cheek. People have a hard time telling the difference around here. The mere fact that I misspelled maim should have been a hint.”
Wait, now I’m confused. Does that mean the statements containing the words “comparrison” and “suprisingly” were tongue-in-cheek as well?
And the word shall come down from the mountain!
Didn’t your mother tell you it was not appropriate to yell “socialist” on a crowded conservative blog? Someone could get seriously hurt …
Dude, who shares a six-pack?
Tim: try sharing a six-pack with her some time… she’s no beer socialist, trust me.
Either way, if someone is going to kill, mame, or poison the public, I might as well back the horse that benefits some families in Oregon by putting people to work in living-wage jobs, without blocking their progress with unreasonable taxes.
So you’re some sort of beer socialist? Or, more precisely, some sort of beer mercantilist? Do you think they won’t apply the tax to beers from macrobreweries out of state who have the audacity to pedal their swill in Oregon? Do you think those companies won’t just pass the cost right on to their customers? They’ll levy the tax on the distributors of every cheap, nasty brew in the land…and to what end? Making those relatively more expensive and hurting the poor, downtrodden fools who consume them.
In the end, it’s exactly the same outcome as the cigarette tax because any tax levied across the whole market will get filtered down to consumers. All either does is move surplus from consumers to government and lose some of it along the way. Being for one but against the other is pretty inconsistent, but I guess that’s to be expected from somebody who’d use the phrase “living wage” without so much as a hint of irony.
PS: It’s maim.
Yup, that’s it, Graf. You got me. I drink beer, and don’t want to pay for it. I know the money is tight making $5 pizzas, but I for one plunk down the extra cash for a good Oregon beer, and will continue to do so even if a tax is passed. This has nothing to do with preference, and everything to do with getting behind local industries that need our support to grow in the global economy. Just as well, if I only cared about things that affected myself, I would not be working my ass off for the Commentator.
And let me save you this:
“If you are stupid enough to [consume product] and hand over your hard earned money to taste that sweet [product], it means that you will hand over more if the state puts a tax on it. Shout out to Andy: how
Principles are like assholes … or maybe they aren’t.
Taxes attached to industries always find their way to consumers. You’re cool with beer, but not cigs. That’s fine. Roll with it. But let’s not equivocate here. You think cigs are filthy, you don’t smoke them, and the tax will never affect you. You drink beer, you like it, the beer tax will affect you.
Dude, Blaser, that’s what it boils down to.
Principles, man. Principles.
Olly – I am flattered.
Call me pro-Oregon business. Maybe if we had a few tobacco farms in Oregon I would cut them a little slack; that, or if Joe Camel was our mascot instead of a mug of beer. Either way, if someone is going to kill, mame, or poison the public, I might as well back the horse that benefits some families in Oregon by putting people to work in living-wage jobs, without blocking their progress with unreasonable taxes.
I see where you are going with the comparrison, but I don’t think stating that people will pay more for cigs relates to the unreasonable taxation proposed on breweries, which would be to the detriment of an emerging Oregon industry. The cig tax would have been a retail tax, with individuals responsible for the increase, not the tobacco companies themselves. The propsed beer tax will be direcly assessed to breweries who produce large amounts of product and not to the consumer, although some price increases would probably be seen on the shelf eventually. For the growing Oregon economy, this propsed tax is a bad idea.
That, and beer makes people happy.
And Andy, I vote for Terminal Gravity IPA.
I propose we drown all state legislatures in pure unfiltered Bridgeport IPA; a refreshing and hoppy alternative to socialism.
Also, anyone who supports this tax increase shal be banished from the People’s Democratic Republic of Oregon for committing heresy upon that which has brought us to nirvana.
Ted, Thank God our idiotic private conversations don’t become fodder for public discourse, I’ll be more careful not to divulge our secret plots for world domination in the future. I will also try to direct my hatred of liberal idealogy at more deserving sources… like this Morrison chump.
“I wouldn
I wouldn’t even be entirely opposed to a tax increase if it was reasonal and proportional to what is in place now, but what is being proposed is astronomical. The tax shouldn’t be raised merely because of the fact that it is low compared to other states, and considering the room for growth in the micro industry, I think it would be a good idea to wait a few years and assess if there is an actual need to raise funds for prevention and treatment.
Well then Brian you are already quite affected by the People’s Liquor Distribution Centers of the Glorious People Democratic Republic of Oregon.
Ian, I wouldn’t call them quasi-socialists at all – that is reserved for the republicans. Democrats are full fledged socialists. It’s just that one side of the isle has concern for some natural rights, and the other side has concern for different natural right. Where they agree though is that natural rights should be violated; just where to place the shackels is the contention.
Doesn’t affect me. I only drink hard alcohol, I can’t stand beer.
The Cascades happen to provide some of the best hops you can grow in the world, which explains the ease of making good beer in the Pacific NW. If this goes through, I can see a lot of the larger breweries just jumping across the Columbia to Washington or across the Snake to Idaho. It’s one thing for a state to be a little bit business unfriendly (like Washington), but quite another for it to be openly hostile. And, yet, the locals and the officials can’t stop wondering why Oregon’s economy has been in the tank for 10 years.
I completely agree, Ted. One could look at France’s struggling wine industry and surmise that the less government interference there is, the better.
Democrats raising taxes by massive amounts? Shocking!
This is what you get when you vote quasi-socialists in. But, hey, at least we don’t have that anti-choice zealot Jim Torrey!
Most small brewers will stay small, mostly because they want to. Already quite a few “true” micro-brewers have expanded towards much higher production and wider distrobution levels with relatively little quality compromised. Beer has (like wine) been long associated with specific regions, and over the last 30 years, the Pacific Northwest in general and Oregon in specific have become associated with high quality, unique beers. The state should seek to exploit this perception, not by taxing these businesses into the ground, but by allowing them to thrive. As these businesses grow, and as our great micros become famous, not only would new jobs be created for production, but most likely for tourism too.
Here’s a link to the complete list of state beer excise tax rates. The U.S. median is $0.188, and Erickson says she would not settle for anything lower than $0.53. I know this wouldn’t affect the smaller micro-brewers, but I’d dislike seeing any increase at all. I want my cheap, weak beer to stay cheap and weak, and my moderately priced Widmer Hefeweizen to stay moderately priced.
LoL! well as long as guns aren’t on the top of the list… 😉
Hey, no fair bringing my ill-considered optimism into this blog. That shit was off the record, yo.
Democrats take complete control and immediatly decide to raise the BEER tax by over 1,000%. They want to make it the highest in the country! But Democrats are pro-business right Ted? With all the new business taxes expected from the new Legislature why would anyone want to open a new business here.