Not many Americans are aware of today's big smuggling activity -- cigarette smuggling. Confiscatory taxes that are as high as $7 a pack, in New York City, making one pack of cigarettes sell for $13, have encouraged a thriving smuggling business across our country. Like Prohibition, confiscatory tobacco taxes are popular with Americans.
A recent study by Michael LaFaive and Todd Nesbit of the Midland, Michigan-based Mackinac Center for Public Policy titled "Cigarette Taxes and Smuggling" shows that states with the highest cigarette smuggling rates are those with the highest tobacco taxes such as Arizona (51.8 percent of the state's total consumption are smuggled), New York (47.5 percent), Rhode Island (40.5 percent), New Mexico (37.2 percent) and California (36.3 percent).
Cigarette smuggling, like yesteryear's whiskey smuggling, has become a livelihood for criminals. The Bureau of Alcohol, Tobacco, Firearms and Explosives has found that Russian, Armenian, Ukrainian, Chinese, Taiwanese and Middle Eastern (mainly Pakistani, Lebanese and Syrian) organized crime groups are highly involved in the trafficking of contraband and counterfeit cigarettes. What's worse is that some of these groups use their earnings to provide financial assistance to terrorist organizations such as Hezbollah and Hamas. That means tax-hungry politicians and anti-tobacco zealots are providing the means for aid to America's enemies.
The solution to cigarette smuggling, and the criminal activities associated with it, is to eliminate the confiscatory taxes. Unfortunately for tax-hungry politicians and anti-tobacco zealots, who see confiscatory taxes as a tool in their moral crusade against tobacco, only benefits count. For them, the costs of their agenda are irrelevant or secondary at best. And, as novelist C.S. Lewis put it, "Of all tyrannies a tyranny sincerely exercised for the good of its victims may be the most oppressive."
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