Mercantilism and the Christmas Tree
By Staff News & Analysis - November 11, 2011

Obama Administration to Delay New 15-Cent Christmas Tree Tax The U.S. Department of Agriculture is going to delay implementation and revisit a proposed new 15 cent fee on fresh-cut Christmas trees, sources tell ABC News. The fee, requested by the National Christmas Tree Association in 2009, was first announced in the Federal Registry yesterday and has generated criticism of President Obama from conservative media outlets – ABC News

Dominant Social Theme: Christmas trees need taxes, too …

Free-Market Analysis: What a relief. There won't be a Christmas tree tax after all. But this ABC News story (above) doesn't really get at the heart of the matter. And what's that? Well … Christmas tree growers apparently – for one reason or another – had to approach the US fedgov about setting up an industry association.

Either they didn't want to do it on their own, or they couldn't, which is typical these days in the US. There seems to be almost nothing that people can do on their own. In the "land of the free and the home of the brave," government approval is required for seemingly any significant business action.

Soon people may even need permission to move from place to place and will have to register with the government if they switch jobs – if they can even find a job to begin with. This is already common around the world, even in so-called democracies and republics!

The US simply lags in that particular category of control. But probably not for long. Here's an excerpt from an article posted at the Huffington Post that explains the REAL backstory, so far as we can tell:

We've all seen "Got Milk," "Beef. It's What's for Dinner," and who could forget "The Incredible, Edible Egg"? With the rise of processed food, people had abandoned their milk for cola and eggs for Pop-Tarts. Christmas trees almost got a catchy slogan, but today the right-wing blogosphere is congratulating itself on having put a stop to it.

In recent years the sales of artificial Christmas trees have grown, as they are promoted as "safer" and sold in many box stores. Natural trees have no ads on TV, and conditions for farmers are worsening because of the recession. There are no major corporate players in the natural Christmas tree business.

Like many small farmers, Christmas tree growers' business is local and their revenue is very seasonal. So this year, the Department of Agriculture passed a proposal that Christmas tree growers would pay a 15¢ fee for each tree sold. The money would be used to form a National Board, like those for milk, beef and 16 other industries, to research, promote and maintain the tree-growers' industry.

Of course, this being the Leftist Huffington Post, the author of the story, Paul Snyder, increasingly turns the affair into an editorial polemic. He writes, "The saddest part is that, under pressure from the right-wing blogosphere, the administration immediately abandoned the plan, leaving the conspiracy theorists to feel vindicated, and tree growers out in the cold."

For Snyder, the attacks on the Christmas Tree tax were actually an attack on small businesspeople who are increasingly losing live-tree market share to artificial Christmas trees made in China and elsewhere. Yes … The idea was to form an industry group and publicize the merits of live trees as the egg and milk industry has done.

But it apparently doesn't occur to Snyder to ask WHY Christmas tree growers felt obligated to ask the government to OK a 15 cent tax on Christmas trees. One explanation that DOES occur is that the growers couldn't get together to raise prices because then they would have been prosecutable by the fedgov for price fixing.

Or maybe at this point there are simply so many regs that it's impossible to do even simple things like put together an industry association and ad campaign without government approval. Call it a kind of enforced mercantilism. Even when industry leaders don't wish to involve in government in their affairs for commercial advantage, they seem to feel they must.

After Thoughts

This is a fairly insignificant story in the scheme of things but it seems to encapsulate a larger issue. Either US Christmas tree growers need the permission of government to pursue a public relations program or they believe for some reason they can't do without it. Unfortunately this is a dilemma increasingly shared by a wide array of American industry. It's one reason – a big one – why industrial growth in the US has stalled.