"You didn't build it!"
Meanwhile, just because it's another pet peeve, I fired off a letter to Mr. Bill over at FOX, and decided to share this little issue with my readers. When I heard Fearless Leader babble his insult to business owners the other day, I almost puked. The situation described below has been going on for a while, and it's a microcosm of what's wrong with the American economy.
Dear Mr. O’Reilly—or Anonymous staff member:
Regardless of how you consider smoking, I want to tell you a little tale about the state of capitalism in America today.
Until recently, there was an upsurge in the proliferation of “Roll Your Own” [RYO] shops in America. These were small, entrepreneurial businesses where one could purchase tobacco, paper cigarette tubes with attached filters, and for a modest fee, feed these ingredients into a machine that would produce a finished product in a matter of minutes. A carton of these cigarettes cost $26 and change, as opposed to $40+ for a carton of, say, Dorals, or $50 for high-line Marlboros.
These machines—about the size of a soft-drink vending machine—cost $35,000 apiece. The entrepreneurs who invested in them were assured by market research that they would pay for themselves fairly quickly. It’s the supply-and-demand thing; there will always be smokers, which is why the federal and local governments love us: we’re cash cows and slaves to whatever “sin tax” they care to levy on our addiction. As Stossel points out to you frequently, it’s a matter of choice. The hypocrisy enters the equation when—for all their self-righteous lip service about “we’re only hiking prices on cigarettes to discourage people from smoking”—the fact is the government loves us, and the loss of tax revenue if everyone quit smoking tomorrow would be substantial.
When President Obama signed his ballyhooed Federal Transportation Funding Act a short time ago, he put God-knows how many small business owners out of business. In Section 100122 of the bill, there is an amendment to, of all things, Subsection (d) of section 5702 of the Internal Revenue Code of 1986, amending this obscure legislation to prohibit the use of these cigarette rolling machines “in commerce.” (See attachment to this e-mail.) When President Obama signed that bill, suddenly hundreds—perhaps thousands—of entrepreneurs were put of business.
I don’t blame the president for this particular outrage. I have a good idea where it came from: “Big Tobacco.” The lobbyists and lawyers from R.J. Reynolds and Phillip Morris did their butt-stroking in Congress, and this little goodie got tacked onto a completely irrelevant piece of legislation. It’s the perpetuation of a monopoly. In immediate proximity to my home, shops in Hiawassee, Georgia and Murphy, North Carolina have already shut down. I expect the shop in Blue Ridge, Georgia—where I have been a regular customer since they opened—to shut down before the end of the year. That particular shop has two of the fully automated production machines, for an initial investment of $70,000, plus the overhead of leasing retail space in a strip mall, employee salaries and other coverage, advertising, etc. You see where this is going. Without talking to the owner, I’m guessing he has $250,000 tied up in this business, and is now dead in the water.
To reiterate, this isn’t about smoking, pro or con. It’s about the death of small business in America, and the nefarious means employed to accomplish this end. The owner and founder of Tobacco Warehouse doesn’t even smoke; he was taking a swing at capitalism. They produced a competitive product at a substantially lower cost than a mega-corporation, and for his efforts he is now effectively bankrupted. At least three employees are now in danger of being out of work, and I have no idea about the financial devastation wreaked upon this gentleman.
Back in mid-March, as my wife and I were driving home from Atlanta, a “consumer advocate” named Clark Howell [WSB-Atlanta] came on the car radio. He started with a preamble about “I don’t condone smoking, but…” and then launched into a description of RYO shops and how you could save big bucks by patronizing RYO shops and doing-it-yourself on their machines. I looked at my wife in the moment and said “That’s it. That’s the death knell for those shops. RJR will shut ‘em down one way or another.” When I said it, I had no idea it would happen so swiftly. A little nibble out of the profits of these monopolistic corporations, and BANG! the little guys are out of business.
I’m a Libertarian coming up on 60, and I have always believed in and defended the ideals of America, but this is just so wrong in so many ways. I don’t condone smoking to anyone, and have already invested in a do-it-yourself rolling machine, because “Big Tobacco” will never get another penny from me, except what I’ll have to pay for the “makings.” For the third time, this isn’t about the politically correct regard for smoking; feel free to substitute any other good or service for the plight of these RYO shop owners. I’m trying to draw your attention to an aspect of the death of small business in America. In a time when the economy is going to hell, the machinations of anyone, foreign or domestic, to destroy the backbone of capitalism—small, individual business enterprises—should be challenged.
If you, Anonymous Staff Person, would like to raise this concern at a production meeting as a topic, I would be grateful. Mr. Bill constantly touts himself as “looking out for the folks.” Well, there are plenty of folks being devastated by this devious bit of legislation. I don’t know what you might do besides call it to the public’s attention, and I doubt that anyone at FOX will read this, because of its length. Still, I tried by writing this exposition. I feel better now for the effort. I think I’ll go have a cup of coffee and a cigarette.
Robert [my full name]
Somewhere on Gray Fox Trail
[hometown, etc. blah, blah]