On prominent display on the south Jersey shore.
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“Within eight months after the change in the law took effect, Viking Yachts, the largest U.S. yacht manufacturer, laid off 1,140 of its 1,400 employees,” reports George Mason University economics professor Walter E. Williams.
By the time the law was rescinded in 1993, Viking Yachts was down to 68 employees.
Not far from where we are in Sea Isle, Egg Harbor Yacht, one of the oldest boatyards in South Jersey, filed for bankruptcy and laid off its 250 workers in 1991, a year after the yacht tax was enacted.
“When it was all over, 25,000 workers had lost their jobs building yachts, and 75,000 more jobs were lost in companies that supplied yacht parts and materials,” states Williams. “The Joint Economic Committee concluded that the value of jobs lost in just the first six months of the luxury tax was $159.6 million.”
And the impact of the luxury tax hike on deficit reduction? Instead of adding the projected $31 million to federal coffers in 1991, the net effect of the luxury tax was $7.6 million more in federal red ink in fiscal 1991.
The impact of the luxury tax on “fairness” and equality? Workers lost their jobs and “the rich” still had their preexisting yachts. The redistributionists aimed at the wealthy and hit the middle class.
That’s not unlike the scenario at the Utz house. If the protesters had been successful in stopping the construction, the Rices would still have their preexisting $12 million beach house and the carpenters, roofers, landscapers, etc., would have paid the price with higher levels of joblessness.
Rather than judging what the Rice family “needs” and carping about the home’s number of master bedrooms, the picketers should have been counting the number of contractors’ trucks lined up in front of the house during the three years of construction.
In addition to those on-site jobs, add the number of jobs in manufacturing, marketing, and shipping for all the sinks, beds, tables, cabinets, chairs, roofing, stone, appliances, doors, windows, landscaping, etc., and new home was a one-man stimulus package.
The protesters may sneer at “the rich” and “unfair” advantages but Utz Foods began as a family business in 1921 when William and Salie Utz began making potato chips in their home in Hanover, Pa., producing 50 pounds of potato chips per hour in their kitchen.
Now in its third generation as a family business and still in Hanover, not China, Utz currently employs 2,200 people and is the largest independent privately held snack brand in the United States, producing a million pounds of potato chips and 900,000 pounds of pretzels per week.
That’s not unlike the Heinz story in my hometown of Pittsburgh. Now a Fortune 500 company, Heinz got its start when 8-year-old Henry John Heinz began selling vegetables to neighbors from his family’s garden. At the age of 12, Heinz was growing horseradish root on several acres and selling his homemade horseradish door-to-door in a wagon.
It is precisely that spirit of entrepreneurship, new ideas, risk taking, investing, productivity, and ambition that we have to commend and incentivize, not demonize, if we want a society with more growth, more employment, less joblessness, and less poverty.
As Milton Friedman put it, succinctly and accurately, “So that the record is absolutely crystal clear, that there is no alternative way so far discovered of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.”
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?