My best friend owns a cigar store. When the original SCHIP legislation was being crafted he was terrified that the proposed 6000% tax on cigars would put him out of business, and although he is a die-hard Democrat, he was angry at Washington.
We discussed the implications of the tax if it were limited to $1/cigar; how that might actually help his bottom line by making his customers believe that their smoking was actually helping kids get health care. Such a tax would hurt him on the 'low end' cigars [$3-5 /cigar] but would have no effect on the high-profit cigars--he sells mostly Fuentes, particularly OPUS X.
Anyway, I decided to read the legislation so that I could help him deal with this dilemma of wanting to help the progressive cause without destroying his livelihood.
Guess what: SCHIP is not paid for by taxes on tobacco.
That is a misrepresentation by its sponsors. And many diarists here at DKos have fallen into the same line. The children's health plan outlined in the SCHIP legislation is paid for out of general revenues. It is funded in the same way Predator drones or F-22's are funded. There is no dedicated income stream each smoker is chipping in for--that is pure public relations.
The tax on tobacco levied in the SCHIP bill is a 'pay-as-you-go' provision; an exercise in responsible governing instituted by Democrats in the face of the Rove-Cheney political machine. And while I, a non-smoker, support 'sin' taxes in general, the idea that we can keep taxing tobacco and alcohol and lotteries, just so we don't have to go before the electorate and make the case for taxing wealth, is unfair and bad policy. These taxes, ultimately, are regressive.
So Kossacks, don't applaud too loudly when you see the GOP break out in crocodile tears because SCHIP is helping people they can't stand and who won't vote for them. Their anger is tempered by the fact that a tax has not been levied on the people they truly care about--the rich--who won't be using the SCHIP program anyway, which is basically how the GOP thinks all social programs should be funded..
even when they are not.