I couldn't help but laugh when I read a headline in the news today: Philly demands bloggers get business licenses. As you read the original story in the Philadelphia City Paper it becomes that much more absurd:
For the past three years, Marilyn Bess has operated MS Philly Organic, a small, low-traffic blog that features occasional posts about green living, out of her Manayunk home. Between her blog and infrequent contributions to ehow.com, over the last few years she says she's made about $50. To Bess, her website is a hobby. To the city of Philadelphia, it's a potential moneymaker, and the city wants its cut.
In May, the city sent Bess a letter demanding that she pay $300, the price of a business privilege license.
How on earth did the Philadelphia city government hear about her alleged business? She filed her puny earnings in her tax report like a good citizen:
She's not alone. After dutifully reporting even the smallest profits on their tax filings this year, a number — though no one knows exactly what that number is — of Philadelphia bloggers were dispatched letters informing them that they owe $300 for a privilege license, plus taxes on any profits they made.
That will show you to be honest and up front. The money she makes from her blog, like most of us, is so little that she didn't actually owe any, but she filed anyway. The city, strapped for cash and hungry for new sources of revenue began mailing out demands that people buy a business license for their blogs.
Here's the problem for Philadelphia: a blog isn't a business. Sure you can make money at it, although very few make even enough to do it for a living, but writing opinion articles and little silly posts about your cat is not a business. Not any more than writing for a newspaper or writing a novel about your experiences as a child growing up in West Nubnuck Arkansas.
The city wants to claim that bloggers are covered under the business license law, pointing to a legal clause:
"engaged in any "activity for profit," says tax attorney Michael Mandale of Center City law firm Mandale Kaufmann. This applies "whether or not they earned a profit during the preceding year," he adds.
The flaw with this attitude is that not every action done for profit is actually a business. Writers are typically considered artists and freelancers, not businessmen. Bloggers are no different; even if you advertise, you're not really engaging in a business as a blogger. You're just writing and hoping someone cares and might click on an ad.
Say, you don't buy or sell online ads on a blog, you put them up for free and hope that enough people look at the ad that you get a tiny slice of that business. The advertiser is a separate business that shares your space on that web page.
Like the little girl in Oregon City, Oregon who tried selling lemonade and got nailed by the state health inspectors, this is a case of someone engaging in management rather than leadership, and doing so because they want money. To these governments, revenue is the most important thing in their lives, not logic or wisdom. What they want to do is get enough cash that they can pay for all the things the city engages in, rather than looking for a way to fit what the city engages in with the cash they're getting.
The internet really seems to annoy governments.
Like a criminal who won't join the syndicate, the internet allows people to engage in a wide and deep free market without giving the local guys their cut. Governments want very badly to find a way to get a slice of what they believe is a huge cash flow. The truth is almost nobody makes much money online, while some make gargantuan sums but try to explain that to a bureaucrat who thinks a web page is an article about spiders.
You and I, when we are making less than we spend, have to find ways to cut back. Not so with governments, their rapacious, endless hunger for cash admits no cuts and only seeks more sources. This was some city bureaucrat's idea of how to get more cash but its simply idiotic: these people have no money to pay for a license even if by some odd legal definition a blog writer could possibly be considered a business.
And if you try to enforce this, all you'll do is drive bloggers underground or out of your city. They'll stop filing their earnings, they'll stop posting under their real name and location, and they'll move to a site that keeps their identity safer.
You won't make any money, you'll just make people trust government less, be more hostile toward politicians, and less scrupulous about their duties as a citizen. And nobody wins when that happens.