Luxury Tax History Repeating Itself

by Brent Smith | October 27, 2015 12:02 am

Since 2008, tens of thousands of coal related jobs have been lost – some almost incalculable. As hundreds of coal plants have been closed, it is not just miners who are affected. As power plants close, all employees lose their jobs. Blue collar and white collar employees get the ax – managers, technicians, secretaries, everyone.
Brent Smith[1]
But that’s not where it ends. Many of these coal plants are located in rural areas. They have whole towns that spring up around them, as townspeople not only work at the plant, but small businesses are created, like restaurants, gas and service stations, grocery and convenience stores, laundromats, dry cleaners, and list goes on – all to support the plant and its employees. As these plants go away, so too do all the support businesses and all their employees.
But this rings hollow to the Obama administration. Obama cares only for himself and his radical agenda, for once again, due to his Marxist, redistributionist, green agenda, history is about to repeat itself.
Obama’s radical green agenda is about to ruin yet another industry. He and other radicals will consider it a win-win as Obama gets to not only advance his phony green plan, but at the same time, his new rule will also redistribute wealth.
Who’s the target? This time it’s the Luxury yacht industry.
In 1990, “when Congress imposed a 10 percent luxury tax,_stupidity_or_connivance/page/full[2]on yachts, private airplanes and expensive automobiles, Sen. Ted Kennedy and then-Senate Majority Leader George Mitchell crowed publicly about how the rich would finally be paying their fair share of taxes,” wrote one my heroes, Walter E. Williams.
“In the first year, one-third of U.S. yacht-building companies stopped production, and according to a report by the congressional Joint Economic Committee, the industry lost 7,600 jobs. When it was over, 25,000 workers had lost their jobs building yachts, and 75,000 more jobs were lost in companies that supplied yacht parts and material. Congress repealed the luxury tax in 1993 after realizing it was a job killer and raised little net revenue.”
You would think our politicians would learn from their mistakes, but Obama and his EPA are not politicians – they are radical ideologues and don’t think any punitive redistributive tax or regulation is a mistake. Obama is in office to advance his radical agenda. Nothing else matters.
This time the president insists that all large yachts[3] built from next year onward will have to install huge equipment on board to help curb nitrogen oxide pollution, hollowing out cabins and other usable spaces just to accommodate the massive equipment.
His “green” regulation will only apply to superyachts larger than 79 ft in length and more than 500 tons. So what, some may say. These owners are already the mega-rich. They can afford it. But it is not just yachts built in America. “The changes mean all large yachts near North America or the U.S. Caribbean will need to reduce sulfur and nitrogen oxide emissions by nearly 80 per cent,” so regardless of where the vessel was manufactured, if it enters U.S. waters, it must be so outfitted.
So what do we think will happen to U.S. yacht manufacturers? Once again, like in the early 90s, businesses will fold or downsize, as the rich go elsewhere to have their latest dreamliner built, not to mention all the businesses which cater to them. And then there are the luxury destinations these mega-rich visit. Will they now avoid theU.S. for more amenable destinations? Seems pretty likely.
Whether they are liberal or conservative, the super rich have one thing in common, other than being super rich. When possible, they will avoid paying additional punitive taxes and unwanted regulation.

History will once again repeat itself, only this time the person implementing the rule, Obama, doesn’t think or care if he’s made a mistake.

Also see,

The Mother of All Good Crises

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