Monday, August 08, 2005

Unconvincing Arguments For Tax Increase

Samoa News reported, “Companies that produce water locally came out strongly in support of a legislation adding ten-cents excise tax on bottled water.” They were not alone in voicing support for the bill. Rep. Paopaoailua Joe Fiaui desires to vote for the measure ASAP, and Rep. Muavaefa’atasi Ae Ae Jr. believes bottled water from foreign countries to be part of some conspiracy to “kill us all, leaving the Koreans and other people alive here.”

Rep. Muavaefa’atasi’s statement was not the only ridiculous argument given in support of the tax increase.

Local companies demand that the public pay higher taxes for bottled water so that their businesses can stay afloat. Island Choice says that we should care about their enterprise because they employ local people. However, a customer of Island Choice’s products isn’t always an employee of the company. So what is Island Choice’s justification for non-employee consumers of their bottled water? Are they going to let the rest of us share in their profits?

I don’t recall local water companies or their employees promising to share the money they make with the rest of society. And I don’t expect them to. Businesses are in it for themselves, as it should be. That is why it is simply morally wrong for entrepreneurs to demand relief at the expense of consumers and taxpayers when things don’t go so well, because in times of milk and honey, they get to keep all the profits for themselves.

That is why after this tax increase, people will call for price controls. A clear sign that the ASG would ultimately regulate local water companies is Sam Kapu’s suggestion that “companies would raise prices however they want to” in absence of a price control board. In addition, Governor Togiola submitted a price-gouging bill last week that would legalize price-controlling measures. If local water companies want to become semi-autonomous institutions like ASPA and LBJ, then they should continue their support for the tax increase. And some companies may want that seeing how public funds will pay their bills.

If there is any conspiracy to be believed, it is that the ASG is posturing itself as a Soviet-styled command and control center of our economy.

Supporters of the tax increase also say we should be ashamed of the low wages foreign bottled companies pay their employees. But have they ever thought about what other alternatives those foreign workers would have if it wasn’t for these foreign companies. Those workers may end up as prostitutes or drug dealers if it wasn’t for their “low-paying” jobs, or they may very well starve to death. If we’re so concerned about poor people starving in countries like Africa, for example, then local companies in American Samoa shouldn’t be trying to undercut their sources of income by blocking free trade.

Rep. Muavaefa’atasi says, “Is [foreign imported water] safe for us?” Here’s a thought for the representative: If a court convicts any company of hazardous products, that will be the end of the company. Would anyone keep going to McDonalds if they were convicted of mishandling their food, which resulted in a dozen deaths? No. Businesses, as well as foreign ones, have the incentive of making more money to keep their products and services as safe as possible. Government, which regulates itself, doesn’t have a similar incentive other than elections every two or four years.

Rep. Paopaoailua says, “Hell, I don't need Fiji water. I support this bill and I'm ready to vote for it.” But why should his preferences be imposed on the rest of us? Aren’t we all free people to decide for ourselves the kind of bottled water we drink? His statement clearly shows that the House definitely doesn’t see itself as the “chamber of kids” as Senators have labeled them. Perhaps it would be more appropriate to call them the “chamber of tyrants.”


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