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12/17/2018

Vox Makes “The Case for Raising the Alcohol Tax”; The Week Tears It Down

As industry members seek to extend the federal excise tax break on beer, wine and spirits next year, the “alcohol tax debate” continues to simmer.  Vox, a website that “explains the news,” took a lengthy look at “the case for raising the alcohol tax” last week, coming down firmly on the side that “it’s time to raise the alcohol tax.”  Author German Lopez makes many familiar points.

First, he cites the 88,000 annual deaths from “excessive drinking” in the US, a death toll higher than “deaths due to guns, cars, drug overdoses, or HIV/AIDs ever have been in a single year in America.”  Then come numerous citations to research and quotations of researchers that make “a tax hike one of the most evidence-based ideas in alcohol policy.” Indeed, “the literature is really overwhelming,” offers veteran researcher-advocate Alex Wagenaar.  Similar claims about studies that purportedly show tax increases lead to declines in alcohol-related problems are provided by Traci Toomey, (University of Minnesota), David Roodman (Open Philanthropy), Mark Kleiman (Marron Institute), William Kerr (Alcohol Research Group) and others.   Alcohol taxes may hit lower-income drinkers more harshly than higher income drinkers, Lopez acknowledges, but they could also “produce disproportionate benefits” for lower income drinkers as well, since their resulting drinking declines may lead to more “positive effects” on health, fewer car crashes, and more.  Then too, revenues raised from higher taxes could also be targeted to support programs benefitting lower-income drinkers, the author suggests.

Yet taxes are unpopular, Roodman points out.  And of course, there’s a “massive, multibillion-dollar industry that can lobby lawmakers to keep taxes low or even cut them.”  And while some argue that higher taxes might prevent benefits of moderate drinking, Lopez joins the new bandwagon and dismisses the “questionable” studies that link moderate drinking to health benefits.  He also, of course, cites the Lancet study conclusion that “No level of alcohol consumption improves health.” Finally, and for good measure, to truly balance alcohol policy in the US, Lopez concludes by advocating “not just an alcohol tax, but a minimum price, regulations on alcohol outlets and programs that restrict problem drinkers’ ability to drink.”

“This is Shoddy Work”   The Vox article got the attention of Matthew Walther, national correspondent for The Week, and he buys none of it, concluding that “raising taxes on alcohol is a terrible idea.”  He sharply questions the “tedious verbiage” and “moronic assumptions” made by some of the researchers cited by Vox and especially rips the “bar napkin math presented as ‘research’ by the aptly named Adam Looney of the Brookings Institution.”  Recall, Looney predicted that the federal excise tax cuts would result in “approximately 1,550 total alcohol- related deaths annually from all causes.” Most of the “science” is based on findings from Wagenaar and others that suggest tax hikes would result in saved lives.  Looney “assumes that there is some kind of statistical constant at work whereby the reverse - a lowering of taxes by a certain percent – will ipso facto lead to a certain number of otherwise preventable deaths,” Walther points out. But, “math does not work that way. Neither does life,” he observes, adding: “This is shoddy work.” If alcohol is such a “public health crisis” and “really so dangerous,” he asks, why not “simply ban it outright?  It is difficult to think of anything crueler than to allow someone to engage in behavior that you think will harm him and then make him pay extra for it.” And the beat goes on.

Publishing Info

  • Year: 2018
  • Volume: 35
  • Issue #: 39
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 2019 Beer Marketer's Insights Seminar

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The 2019 Beer Insights Seminar will be held in New York City, on Sunday evening, November 17th to Monday, November 18th at Convene.