"Most taxation has an over-burden in the form of distorting economic activity. But raising alcohol taxes actually moves us in the direction of economic efficiency. Even ignoring the costs alcohol imposes on the people who drink too much of it and on their families, the external costs of heavy drinking–costs on various public budgets plus losses to individuals as a result of drinking people outside their families – are several times as high as the taxes collected on it. So even in purely free-market terms, alcohol is currently grossly under-taxed; in effect, the rest of us get to subsidize the brewers and their best customers through our health insurance bills, our auto-insurance bills, and our police budgets."
—Okay, now I am starting to get concerned about all these deficit reduction plans.
9
Don't worry, the idea that using taxation to correct negative externalities is a free-market solution is really not a road that Republicans want to go down, because it leads to a carbon tax.
Bottle Cap and Trade
When Hell freezes over and the white, country-club Republicans who control Congress vote to impose onerous liquor taxes, I'll have enough ice to get me through most of a weekend.
I hate to admit it, but increasing alcohol tax might be a workable plan. Liberals can embrace the paternalistic (not that they call it that) encouragement to modify lifestyles, a la the cigarette tax; Republicans get yet another tax which will be paid disproportionately by the poor, and everyone gets to look like they're making a real effort at fixing the deficit without actually cutting entitlements or large increases on income tax to the wealthy – the only two things which actually might balance the stupid fucking budget.
Don't get your hopes up – repealing the alcohol tax was the only referendum that passed in the Socialist Republic of Massachusetts this year. Even our paternalistic liberals like their cheap booze.
Isn't this just a convoluted endorsement of Prop 19?
People who play these bullshitty externality games should be required to account for the "hidden" benefits, too. Those of alcohol include "improved health for many" and "preventing the utter collapse of civil society."
Hello, I am a person that would like the budget to be balanced. Oh, what's that? My taxes might go up? Nevermind!
Welcome to the world.
First, fags. Now, booze. Next, the Swear Box.