64. Tax In Price

Tax In Price
Bob Komives
::

Artificially,
our government raises

(or lowers)

the price of a good or a service
so that
we change our patterns of purchase,
so that

(for communal benefit)

we change our private investment.

||

The U.S. American government does not forbid that we work on the 4th of July, but rather requires that employers pay extra to those of us who do work. That is a tax in price. We raise the cost of labor on the holiday to induce employers to give us the day off. When our government put a tariff on certain electronic equipment imported from Japan, it raised the cost to consumers in the USA. When it twisted the collective arm of Japanese auto makers to put a quota on exports to the USA Japanese manufacturers began to export to us more expensive cars. The increased prices and changes in products induced some of us to buy other products --perhaps made in the USA by a Japanese firm, perhaps made by a USA company in Mexico. Some of us may have changed to the more expensive, more luxurious Japanese autos, because, though it was more luxury than we needed, we were willing to sacrifice in some other part of our budget in order to have Japanese quality in our transportation. With or without intent, our government induced these changes in the way we play our roles as consumers. The tariff brought money into the USA treasury, while the quota gave higher per-item profit to the Japanese companies. Both tariff and quota induced a reallocation of our resources in U.S. America. Both were price taxation because changes in price and product-for-price caused the reallocation. These reallocated resources were the income (and loss) from the tax in price. Any money that came into the USA treasury was incidental by-product, not income.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV
:: 64. Tax In Price ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::