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Obama's new cigarette tax -- Bravo!
There are still a bunch of wild-eyed Republicans claiming that Obama's new cigarette tax is yet another example of a "socialist president." or, at best, a "tax-and-spend liberal." Such absurdities!
These puritan capitalists hate whenever the government "interferes" with the marketplace--even when it makes sense. Sure, obviously you don't want government to discourage the benefits of innovation and the efficiencies of ethical production and distribution. Who among us would be willing to impose a burdensome sales tax on aspirin, toothpaste, or toilet paper?
But there's a time for everything--and surely there's a time for more taxation and greater regulation. President Obama demonstrated this wisdom when he signed into law the new cigarette tax hike, which goes into effect today, raising the federal per-pack sales tax from 39 cents to $1.01--the single largest cigarette tax hike in U.S. history. Obama vowed to use the new revenue (about $33 billion over 4.5 years) to help fund the newly expanded Children's Health Insurance Program (better known as CHIP). Of course, I can still hear the lamentations of those bug-eyed conservatives spewing the vulgarity: "tax and spend!"
But Obama's new tax hike makes absolute sense: it actually saves money--and saves lives.
According to the CDC, cigarette smoking, which is a major contributor to heart disease, cancer and lung disease, costs the economy a whopping $193 billion in health care expenses and lost time from work. Strategically, the steep new tax will hit where it really hurts: the smoker's wallet! Heavy adult smokers won't be phased. But many smokers who just started (and who are in the quitable stages of addiction) will kick the habit. And many young people--who tend to be highly sensitive to cigarette affordability--will back off (liek I did 30 years ago). They just can't scrap the extra cash from the piggy bank.
Historically, every 10% increase in the price of cigarettes reduces youth smoking by about 7%, and reduces overall cigarette consumption by about 4%. For those who are unfamiliar with the epidemiology of tobacco-related diseases, these reductions may seem modest but they're actually quite significant because of the consistently high risk of poor health that accompanies both young and older cigarette smokers (not to mention the public consequences of second-hand smoke).
Obama's tripling the cigarette tax is a very sensible public health intervention and an effective way to raise tens of billions of dollars for a federal treasury strangulated by new military spending.
Here are a few other public health "vices" that deserve a steep federal tax:
Fast food: Let a greasy burger cost, let's say, $12.50, and oily french fries cost $7.50. And watch how many people bail out of this $20 lunch. And then watch the nation's economic burden of obesity, heart disease, and high blood pressure take a distinctive plunge.
Alcohol: Let a 6-pack, or a fifth of Jack Daniels, cost, shall we say, $25. And let a "forty" cost 10 bucks. Then watch the economic burden of crime, liver disease, and DUI fatalities (and injuries) plummet.
Pornography: Let a cheap-thrill video cost about $50 and a magazine cost about $20. Then devise an international cooperative whereby internet porn is fiercely taxed (or shut down completely). And watch the rates of sexual molestation and sexual violence against children and teens (that have sharply risen with the advent of the internet) begin to fall, along with the economic health burden of counseling and treatment for stunted sexual development. And then watch the cultural value of girls and women begin to rise.
Then, spend the trillions of new revenue on beneficial things like schools, public health programs, parks, and community development. And watch the overall health and wellness of society begin to rise (instead of fall).
I'm sure Obama wouldn't dare take on these other more controvserial industries, at least not by targeting their consumers with a hefty tax...but I'll keep hope alive.
These puritan capitalists hate whenever the government "interferes" with the marketplace--even when it makes sense. Sure, obviously you don't want government to discourage the benefits of innovation and the efficiencies of ethical production and distribution. Who among us would be willing to impose a burdensome sales tax on aspirin, toothpaste, or toilet paper?
But there's a time for everything--and surely there's a time for more taxation and greater regulation. President Obama demonstrated this wisdom when he signed into law the new cigarette tax hike, which goes into effect today, raising the federal per-pack sales tax from 39 cents to $1.01--the single largest cigarette tax hike in U.S. history. Obama vowed to use the new revenue (about $33 billion over 4.5 years) to help fund the newly expanded Children's Health Insurance Program (better known as CHIP). Of course, I can still hear the lamentations of those bug-eyed conservatives spewing the vulgarity: "tax and spend!"
But Obama's new tax hike makes absolute sense: it actually saves money--and saves lives.
According to the CDC, cigarette smoking, which is a major contributor to heart disease, cancer and lung disease, costs the economy a whopping $193 billion in health care expenses and lost time from work. Strategically, the steep new tax will hit where it really hurts: the smoker's wallet! Heavy adult smokers won't be phased. But many smokers who just started (and who are in the quitable stages of addiction) will kick the habit. And many young people--who tend to be highly sensitive to cigarette affordability--will back off (liek I did 30 years ago). They just can't scrap the extra cash from the piggy bank.
Historically, every 10% increase in the price of cigarettes reduces youth smoking by about 7%, and reduces overall cigarette consumption by about 4%. For those who are unfamiliar with the epidemiology of tobacco-related diseases, these reductions may seem modest but they're actually quite significant because of the consistently high risk of poor health that accompanies both young and older cigarette smokers (not to mention the public consequences of second-hand smoke).
Obama's tripling the cigarette tax is a very sensible public health intervention and an effective way to raise tens of billions of dollars for a federal treasury strangulated by new military spending.
Here are a few other public health "vices" that deserve a steep federal tax:
Fast food: Let a greasy burger cost, let's say, $12.50, and oily french fries cost $7.50. And watch how many people bail out of this $20 lunch. And then watch the nation's economic burden of obesity, heart disease, and high blood pressure take a distinctive plunge.
Alcohol: Let a 6-pack, or a fifth of Jack Daniels, cost, shall we say, $25. And let a "forty" cost 10 bucks. Then watch the economic burden of crime, liver disease, and DUI fatalities (and injuries) plummet.
Pornography: Let a cheap-thrill video cost about $50 and a magazine cost about $20. Then devise an international cooperative whereby internet porn is fiercely taxed (or shut down completely). And watch the rates of sexual molestation and sexual violence against children and teens (that have sharply risen with the advent of the internet) begin to fall, along with the economic health burden of counseling and treatment for stunted sexual development. And then watch the cultural value of girls and women begin to rise.
Then, spend the trillions of new revenue on beneficial things like schools, public health programs, parks, and community development. And watch the overall health and wellness of society begin to rise (instead of fall).
I'm sure Obama wouldn't dare take on these other more controvserial industries, at least not by targeting their consumers with a hefty tax...but I'll keep hope alive.
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Comment by White Lion on April 1, 2009 at 12:43pm -
Pornography? You've gone a little too far....LOL
Seriously, I don't think you thought the alcohol thing all of the way through. Remember alcoholism is a disease, and with increased costs, thugs will do what they have to do to get their drink on. To suggest a radical increase in the price of forties and beer will result in a sharp drop off in urban crime is ludicrous at best, I think it will the opposite effect. You of all people should understand the dynamics of the hood and the people's thought processes.
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Comment by Shaman on April 2, 2009 at 11:22am -
White Lion, just think about the flipside of what you're saying. In other words, if we reduce the alcohol tax (and thereby increase its elastic demand) then crime should drop, right? Nope, it doesn’t work that way.
I think you're confusing taxation with criminalization. But these are two very different animals. Yes, during the notorious Prohibition Era, the criminalization of alcohol sent the industry into an underground bloodbath. But the main perpetrators of violent crime during that era were not the consumers but the underground producers and distributors vying for market control (which is why I support substantial decriminalization of illicit drugs because we should not respond to human disease (addiction) with criminal law 101. )
In our modern era, there are several studies which have clearly shown that state and local governments who increase their alcohol tax tend to reduce crime. That’s because (1) alcohol consumers are surprisingly responsive to price changes, and (2) tax hikes on alcohol tend to reduce consumption, which, in turn, tends to decrease medical and social problems associated with alcohol abuse, including crime.
Again, keep in mind that I'm not suggesting that we abolish the sale of alcohol and send the market underground with glocks and uzis. I’m simply saying that we boost the tax and thereby moderate its consumption. States that have done this do not suddenly experience a rash of killing sprees by winos who are $5 short on a six-pack or a pint of whiskey. Indeed, any negligible increases in petty crimes (like theft) and public nuisance behavior (like aggressive panhandling), are dramatically offset by reductions in the far more costly alcohol-related health problems, including cirrhosis, heart disease, cancer, obesity, diabetes, fetal death syndrome, domestic violence, depression, and DUI fatalities.
Think about it: alcohol accounts for a whopping 40% of all fatal car crashes. There are over 20,000 alcohol-induced deaths in the U.S. each year--and that does not include DUI fatalities. And if these deaths are not sufficiently compelling then maybe the economics is: Fetal alcohol syndrome alone runs about $2 billion annually. And total costs for alcohol, including medical treatment, mortality, and lost productivity, are in the $200 billion range. About 40% of that is paid by the taxpayer.
Of course, the problem here is not that stiff taxes don’t moderate consumption and reduce its deadly consequences; the problem is that the big alcohol lobbyist on Capitol Hill (and on state and local legislatures) are too powerful to allow such a strategy to slash their revenues. The same thing is true for the food, tobacco, and entertainment industries. We have more than enough evidence to know what is healthy for humans and what is not. There's no deficit of data on the health burden of alcohol. The real deficit is one of political will by those in power. And thankfully, Obama stood on the right side of this issue when he signed into law a massive tax burden on one of the most powerful industries on earth. That’s very encouraging news for those of us who work in public health. Bravo!
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Comment by White Lion on April 2, 2009 at 4:02pm
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1) Can you shorten your responses a bit...LOL
2) If you increase the price of an addictive drug (alcohol), people will drink no matter what. So if it gets to the point where they can no longer afford it, they will find other ways to purchase "by any means necessary".
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Comment by Shaman on April 2, 2009 at 4:46pm
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Regarding your second point: it's only true for alcoholics. But most drinkers are not alcoholics.
Again, using very basic concepts here from Economics 101 and Epidemiology 101: The demand for alcohol does not have unlimited "elasticity." When the price goes up, some consumers keep buying and some consumers bail out. But the overall consumption decreases and the overall health and social consquences decrease. Same with tobacco.
I can't break it down any simpler than that. But I'd be happy to send you the leading research studies from NIDA and other top public health scientists if you'd like. It's the same data that we use at the National Medical Association.
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Comment by White Lion on April 2, 2009 at 5:00pm
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My point is alcoholics are more inclined to commit crime and have liver disease. So I believe the net effect after thinking it through a little further will be minimal and not "plummet" like you put it. Of course these are all theories and no one will know for sure. I'm simply employing a bit of common sense here.
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Comment by White Lion on April 2, 2009 at 5:04pm
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By the way, I can show you "research studies" arguing the earth is flat....LOL
All depends upon who's conducting and funding these "research studies".
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Comment by Shaman on April 2, 2009 at 5:28pm
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Sure, there are some studies that claim cigarette smoking doesn't cause cancer, and fast food doesn't cause obesity. You're right, the public health research industry can get pretty ridiculous. LOL!
But White Lion, I gotta be honest with you here. The data on alcohol are as overwhelming as the data on tobacco. But, as with all health problems, folks believe what they wanna believe. And sadly, black folks tend to have the worse health literacy, the most erroneous health beliefs, and the highest mortality in the nation. Of course, these data too could be bogus (but here again the data are overwhelming).
Again, in the end, folks do what they wanna. But I expect my elected officials to make public health decisions that are based not on whim and unlearned speculation but on the preponderance of the evidence. And I expect them to hire public health experts who actually know the evidence.
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Comment by White Lion on April 2, 2009 at 6:12pm
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You're flipping the script on me, I'm not arguing the negative effects of alcohol. Time to move on.
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Comment by Shaman on April 2, 2009 at 6:34pm
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Uh, sure, no problemo.
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