Public Health Taxes and Health Care Costs
I don’t really like it when people attribute to me views I don’t hold, so I’ll say in response to Paul Campos that I know perfectly well that if the public adopted healthier lifestyles this would do little to reduce health care costs. Indeed, as he says,depending on exactly what happens healthier lifestyles might lead to higher health care costs.
I don’t think the case for taxing public health hazards at all rests on any such claim. Instead, as I’ve been saying, the case for such taxes rests on the claim that raising revenue through some source or other is going to be necessary when the recession ends. As you can see, Obama administration’s budget (demarcated with the dotted lines) leaves revenue as a percent of GDP far too low to pay for the government services we need:
That dotted line already assumes you’re repealing Bush’s tax cuts for the rich. You could—and we probably should—raise taxes even further on the rich. But I don’t think there’s a realistic way to get all the way to where we need to go purely through that mechanism. So the isse becomes that if you’re going to have broad-based sources of revenue, it makes sense to obtain a decent chunk of that revenue through taxes that, at the margin, encourage healthier behavior rather than through taxes that, at the margin, discourage economic activity.
79 Responses to “Public Health Taxes and Health Care Costs”
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May 1st, 2009 at 6:49 pm
Numbers, please. How much to be had from, say, doubling the inheritance tax, vs. expected revenue from taxing items associated with unhealthy behaviors. Etc.
Also this: when ranking unhealthy things, should pleasurableness be a factor?
May 1st, 2009 at 7:08 pm
Don’t worry about it, Matt – Campos sees puritanism and fat hatred everywhere. And he has about 3 sources that he cites over and over again to “prove” that there’s been no increase in obesity in America, and besides, obesity doesn’t harm health, and besides, bad health from obesity saves money.
LGM is much, much worse for having him on board.
May 1st, 2009 at 7:42 pm
Do you know what is the big hole in the deficit spending paradigm?
It is actually really bad for the rich, those who pay the most taxes. Why? In general we hear how every American’s share of the debt is some tens of thousands of dollars. Well, this isn’t really true. National debt isn’t distributed evenly among all citizens. In the end, the rich will pay most of the debt, this is a fact.
The question is why would they would allow this situation to develop. The rational policy for the American rich would be to heavily tax corporations (with a progressive tax). Why? Because large corporations are partly owned by non-Americans. Reducing taxes on large corporations allows the export of profits to foreign owners.
May 1st, 2009 at 7:42 pm
Heh. When you get to the point where taxing the rich isn’t enough, you might want to consider that expenses are too high. OTOH Maybe the bottom half of the country should pay income taxes again.
May 1st, 2009 at 8:02 pm
“if you’re going to have broad-based sources of revenue, it makes sense to obtain a decent chunk of that revenue through taxes that, at the margin, encourage healthier behavior rather”
This is bullshit thinking. And Matthew is not alone in the lefty DC cocoon in thinking this way.
If you want a broader tax base than income taxes permit, then be forthright and advocate for a VAT.
Trying to micromanage public decision-making in the guise of revenue raising is bullshit thinking. We don’t tax cigarettes to raise revenue. We tax cigarettes because we’re trying to reduce smoking rates. Trying to expand such taxes beyond the blindingly obvious cases is a disaster in both political and policy senses.
The folks who have taken Nudge a bit too seriously know just enough to cause some real damage.
May 1st, 2009 at 8:26 pm
So the isse becomes that if you’re going to have broad-based sources of revenue, it makes sense to obtain a decent chunk of that revenue through taxes that, at the margin, encourage healthier behavior rather than through taxes that, at the margin, discourage economic activity.
What Petey said.
Also, to a certain extent, nearly all taxes “discourage economic activity” at the margin. Taxing HFCS, after all, is going to hurt the folks who sell farm equipment to corn growers. I don’t know that it’s possible to come up with a tax scheme that doesn’t generate some degree of dead weigh loss.
Now, maybe what Matt should be saying is that a VAT isn’t politically feasible, and that therefore, because we’re going to need more revenue, it’ll be easier to raise taxes on things we can demagogue as unhealthy. But we’d really be better off just converting Obama’s “only 2% will pay higher income taxes” to, say, “only 20% will pay higher income taxes.” I mean, that would still leave 4/5ths of the country alone. And, yes, I’d advise openness to a VAT. Narrowing the tax base isn’t a good idea. Far better to tax all goods and services and keep the rate as low as possible than put Coca Cola out of business. (And please, no bitching about the non-progressivity of a VAT. There isn’t a single effective social democracy — not a one — that’s able to pull off a commitment to a robust safety net while eschewing consumption taxation; also, rather obviously — but it has to be stated because it never is obvious on these threads — the big picture has to be looked at after taxes/transfers before one can judge whether or not a given economic/taxation system is just).
May 1st, 2009 at 8:29 pm
So the isse becomes that if you’re going to have broad-based sources of revenue, it makes sense to obtain a decent chunk of that revenue through taxes that, at the margin, encourage healthier behavior rather than through taxes that, at the margin, discourage economic activity.
What Petey said.
Also, to a certain extent, nearly all taxes “discourage economic activity” at the margin. Taxing HFCS, after all, is going to hurt the folks who sell farm equipment to corn growers. I don’t know that it’s possible to come up with a tax scheme that doesn’t generate some degree of dead weigh loss.
Now, maybe what Matt should be saying is that a VAT isn’t politically feasible, and that therefore, because we’re going to need more revenue, it’ll be easier to raise taxes on things we can demagogue as unhealthy. But we’d really be better off just converting Obama’s “only 2% will pay higher income taxes” to, say, “only 20% will pay higher income taxes.” I mean, that would still leave 4/5ths of the country alone. And, yes, I’d advise openness to a VAT. Narrowing the tax base isn’t a good idea. Far better to tax all goods and services and keep the rate as low as possible than put Coca Cola out of business. (And please, no bitching about the non-progressivity of a VAT. There isn’t a single effective social democracy — not a one — that’s able to pull off a commitment to a robust safety net while eschewing consumption taxation; also, rather obviously — but it has to be stated because it never is obvious on these threads — the big picture has to be looked at after taxes/transfers before one can judge whether or not a given economic/taxation system is just).
May 1st, 2009 at 8:34 pm
We don’t tax cigarettes to raise revenue. We tax cigarettes because we’re trying to reduce smoking rates.
Although here I guess I disagree with Petey. Surely we do both: we raise tax revenue AND we discourage a harmful activity. Don’t we?
May 1st, 2009 at 8:46 pm
The real problem here is the implicit assumption, all too common, of government infallibility – namely, that policymakers know what does and does not constitute ‘healthier behavior’ when deciding which ‘healthy behavior’ to uniformly ‘encourage’. History is full of counterexamples, but this does not discourage or as far as I can tell even cross the mind of Matthew.
May 1st, 2009 at 9:27 pm
For years, one of my friends who smokes bought hand rolling tobacco since it was a lot cheaper than ready made cigarettes. President Obama raised the federal tax on rolling tobacco will go from $1.09 to $24.78 per pound (2273% tax increase). My friend still smokes, but is worse off under the Obama administration.
He exercises and eats vegetables, but I guess Obama doesn’t like him smoking even though Obama smokes himself…
May 1st, 2009 at 9:27 pm
Paul is being too clever by half. The point is not only the health care costs for treating people who are obese and smoke compared to healthy people who die from Alzheimers (although living longer doesn’t necessarily mean you consume more health care). People who are obese and who smoke have lower productivity when they are “healthy.” They have more sick days because of back and joint pain, complications of diabetes, respiratory illnesses, etc.
Paul’s faux sophistication disguises a profound ignorance about the actual costs to society of self-abuse.
@9:
Informed policymakers, like all informed citizens, do know what constitutes the healthy behavior to encourage. Like Obama encouraging people to wash their hands, cover their coughs and stay home when they’re sick. Stuff like that–together with advice to lose weight, stop smoking, don’t drive while drunk, wear a helmet when you ride a motorcycle and wear suncreen on a beach–is stuff any middle schooler could understand. It saves lives and it saves money.
When you indulge your risky lifestyle, you’re raising my insurance rates and my tax rates. You’re basically stealing from me.
When people like “Sonic Charmer” sign a waiver saying that they want to die alone on the street when they find themselves destitute from health care costs, that’s when my interest in their behavior ends. But if you plan to use either insurance or welfare/medicaid/medicare to compensate for your bad behavior, you’re doing it at my expense.
May 1st, 2009 at 9:52 pm
yeah, what jroth said.
campos has written some good stuff at lgm, but whenever it comes to food issues, he freaks out in a major way and gets hysterical. he’s sure the fat police are coming to take him away, and he’s not going to give up his twinkies until you pry them from his cold, dead fingers.
dunno why an otherwise sensible, occasionally insightful guy has such a huge blindspot, but i was certainly not surprised that he went ballistic over matt’s earlier post.
May 1st, 2009 at 10:11 pm
Ah yes, Joel, that’s exactly the same as punitive taxation to teach a lesson to people who want to chill out with a bag of Sun Chips and a Budweiser.
Who the hell are you to scold other people for enjoying their pleasures and liberties? Oh, excuse me, their “bad behavior?”
May 1st, 2009 at 10:19 pm
“Who the hell are you to scold other people for enjoying their pleasures and liberties?”
You have the liberty to steal from me to pay for the consequences of your “pleasures” and “liberties?” Yes, I consider that “bad behavior.” That’s who the hell I am.
When you come reaching for insurance money or the government because you can no longer pay for your cancer chemotherapy, your diabetes treatments or your heart transplant, you’re stealing from others, my little troll.
Grow up, little boy.
May 1st, 2009 at 10:56 pm
MY’s analysis begs the question.
If Campos is right, then doing things like raising cigarette taxes increases health care costs. By doing things like allowing people to, say, live to 85 instead of 75. Those extra 10 years cost the govt a tone of money in Medicare and Social Security costs.
MY just assumes these taxes to be revenue positive. But are they? Yes, adding a dollar tax to a pack of cigarettes will generate revenue. But it will also add costs in Medicare and Social Security pay-outs.
Which is bigger?
Astoundingly, MY just sort of punts. And complains that people like Campos do not appreciate the subtle brilliance of his analysis. Uh… what gives? If you are going to concede that improving health can add health care costs, why assume sin taxes are revenue positive? Is that just what bitter ex-smokers do?
Dude. Light one up. Think it through. You know you want one.
May 1st, 2009 at 11:10 pm
Joel – your vote on this counts as much as any other participant’s but I suspect that when it comes to it, most Americans would join me in preferring a more liberal health plan, and a less Spartan approach to life in general, than you appear to advocate.
Does pleasure weigh anything at all on your scale? Other people’s pleasure, I mean.
May 1st, 2009 at 11:10 pm
Even if it is politically feasible, I’m not sure I like the idea of the government deciding what should be virtue and what should be vice.
Plus sales taxes are generally regressive and often have a strong correlation with decreasing demand.
Maybe I’m unrealistic, but I was hoping that once we move towards a government funded healthcare system, the government will be able to collectively bargain down prices, in a way that divided insurers cannot. If we were paying the same per-capita cost for healthcare that they do in Canada, we wouldn’t need any extra taxes to cover the costs.
I’ll admit up-front that not all of the savings will come from generally popular things.
Some of the cost savings will be because it is cheaper to insure larger groups, because payouts will have less correlation. As I mentioned above, some of the savings will come from the ability for the government to force hospitals, doctors, and producers of medical supplies and equipment to take a haircut. Obama has mentioned efficiency increases due to making medical records electronic, although I’d be surprised if it is a major contributor. Those are the popular cost-savers.
But some of the savings will come because the government can indemnify itself against legal liability. Whereas a private insurer can be sued for mistakes in decisions about coverage, the government can indemnify themselves against such suits. Decreasing legal expenses will decrease costs.
But perhaps the least popular cost cutting measure that government can enact is to eventually tell people “No”. If they don’t fund treatments that will be unlikely to work or ones that will only give a short extension to the life of someone who has already lived a long life, the cost savings will be huge. As cold hearted as this might sound, these decisions reflect real world constraints that we have been unable or unwilling to address, in the same way that we are constrained by gravity.
May 1st, 2009 at 11:17 pm
@15: look, there’s no percentage in arguing that we should keep cigarette taxes low … so people will die young and thereby reduce health care costs.
The goal is not revenue-efficiency, the goal is human quality of life! So, whatever the marginal effects on revenue, an “unintended consequence” that involves people living longer is going to be hard to portray as a bad sort of unintended consequence.
By contrast, I’m sympathetic to Petey’s argument earlier, which I would rephrase this way: “if MY is right that income tax is systematically inadequate to provide needed revenue, we need a coherent supplement, not a bunch of ad hoc patches.”
Also, I’d like to hear MY’s explanation of why we can’t get where we need to be just by soaking the rich. Is the problem economic — diminishing returns? Or is it just not politically feasible? And if the latter, how come MY’s usual policy of treating political expediency as a variable rather than a constant doesn’t apply here?
May 1st, 2009 at 11:19 pm
Before we tax twinkies, couldn’t we, I dunno, drastically cut the defense budget?
May 1st, 2009 at 11:27 pm
@Patrick C: Instead of government health care, could we reduce health care expenses by passing tort reform?
May 1st, 2009 at 11:27 pm
Off-topic, but the party ID graphs JMM posted at TPM tonight are brutal. If I were a Republican I’d be in the market for a really good anti-depressant.
May 1st, 2009 at 11:36 pm
That begs the question as to what is healthy. There is a definitive answer on cigarettes and taxes on cigarettes are valid. Cigarette smoking clearly is a leading cause of cancer. Cancer is terrible and the proof that cigarettes cause cancer is overwhelming. The benefits of exercise are clear too. All the other healthy lifestyle advice changes daily. And it gets worse from there. Fundamentalists claim the fundamentalist way of life is healthy. Should taxes be set to bring about the fundamentalist way of life? Of course not but the fundamentalist do argue that fundamentalist way of life is healthy. I think this whole nudge deal vis-a-vis healthy lifestyles is a huge mistake.
May 1st, 2009 at 11:46 pm
Bye.
May 1st, 2009 at 11:51 pm
zod has a good point: One week, coffee is bad; the next week articles say two cups a day is good. One day, studies say red wine is good; the next day, there is a study that it causes cancer.
I smoke, but I know it’s bad. I know I’ll quit someday but I am upset that Obama broke his campaign pledge:
Certainly he has raised some of my taxes. He smokes, but of course he can easily afford the tax increase because of his salary and book deals. A lot of people don’t have the same income and can’t instantly quit just because of a tax increase.
May 2nd, 2009 at 12:38 am
I’ll believe that liberals are really against iunhealthy behavior when they focus the same disapproval on sexual risks that they do on food and smoking risks. But increasingly the left is demanding that all sexual mores be destroeyd and everyone should just do everyone else (read the latest posts by Amanda Marcotte and Jessica Valenti about “the culture of purity” at TPMCafe if you do not believe me).
People who are obese and who smoke have lower productivity when they are “healthy.”
So what? They don’t owe the government that producitivity.
May 2nd, 2009 at 1:14 am
You walk down a supermarket aisle and you rate everything one to five. Anything rated one is extra, extra healthy, basically vitamins and fiber in a bag. Five is garbage. We all know what it is. It is concentrated sugar-death or any Energy Drink.
You don’t want to destroy commerce, so you tax anything rated five just a nickel. You raise $50 billion and you build a giant wind farm to provide clean energy for all Americans, Coke stays in business, and you keep contentious health issues out of the equation. Pundits be damned.
What is so fucking complicated?
May 2nd, 2009 at 4:49 am
Not only is Matthews idea unsound economically, but it’s socially unjust. Taxing junk food will raise more revenue, sure, but if it also encourages healthier eating habits, it will lead to higher health care expenditures in the long run. There’s no net budgetary gain in other words, he’s simply increased the slope of both the revenue and outlay curves.
His idea is socially unjust because he’s asking the people who will use fewer health care resources over the course of their lifetime to subsidize the health care costs of those who will use more of the health care resources.
The answer to this problem is obviously to impose taxes on things like health food and vitamin supplements. The people who eat this crap are the ones who will consume the most health care resources. Let them pay for their own health care. Taxing health food works economically by decreasing the slope of government outlays on health care while simultaneously increasing the slope of the revenues.
I, for one, do not think being pressured by the government into popping pills, eating cardboard, and drinking soy “milk” is an increase in the quality of life. It reminds me first of the joke that the quality of the food may suck but there’s plenty of it and second of the Physical Jerks in Orwell’s 1984….
“Thirty to forty group take your places. Thirties to forties! Arms bending and stretching. One, two, three, four…”
May 2nd, 2009 at 5:24 am
God damn, nothing seems to bring the fury of the right than the existential fear of someone judging their food!! Join me, comrade, in our rallying cry: Hamburgers or Death!!
May 2nd, 2009 at 5:27 am
I Go through article as well as all the comments, i was socked when i reached to graph and more details of health expenses. this is really very big digit i have ever seen. Thanks for sharing.
May 2nd, 2009 at 6:19 am
That’s a pretty dishonest post by whatshisname. Hell, even I’m for high taxes on alcohol, and I’m drinking the fine microbrews all the time, probably too much.
I refrained on post this earlier though, but the desire to implement higher sin taxes to pay for health care is ultimately unsustainable, if you raise taxes enough, people will actually consume less of this stuff, perhaps even kick the bad habits, and at some point you’re left with a budget gap because of it.
Regardless, on its own merits, taxes on bad behavior (in terms of social costs) aren’t a bad idea for the very real benefits that could occur from them, but we should never rely on them for budgets going forward, at least not for very long, because if you tax something high enough, people will stop or refrain to a lower frequency, and then the tax income starts to dry up, or at least falls far short of the initial returns.
May 2nd, 2009 at 7:33 am
@eb,
“Does pleasure weigh anything at all on your scale? Other people’s pleasure, I mean.”
Sure. Just don’t ask me to pay for the consequences. There are plenty of ways to get pleasure out of life without smoking, becoming obese or an alcoholic. If your only means of getting pleasure involves activities that later require insurance money or medicaid/medicare to pay for the consequences, you are simply asking others to pay for the consequences of your self-indulgence. Face it: if you smoke, you probably have or will get cancer and/or heart disease. If you are obese, you probably are or will become diabetic and have heart disease. If you are an alcoholic, you will probably lose your job and your home.
Unless you foreswear any tax or insurance money to pay to repair the damage you do to yourself, you are not taking personal responsibility for your actions. Your freedom ends when you expect me to carry the can for your preventable mistakes.
May 2nd, 2009 at 10:06 am
Re Joel at 11: “Paul’s faux sophistication disguises a profound ignorance about the actual costs to society of self-abuse. ”
——–
Er..what are we talking about here,exactly ?
May 2nd, 2009 at 10:16 am
“Er..what are we talking about here,exactly ?”
Well, to start with, this canard:
” . . . probably because they resonate with some deeply embedded cultural puritanism . . . ”
It has nothing to do with “cultural puritanism,” whatever the hell that is. It has everything to do with people who deliberately indulge in risky behavior paying the costs that predictably flow from that behavior.
Hope that helps.
May 2nd, 2009 at 11:00 am
Certainly he has raised some of my taxes. He smokes, but of course he can easily afford the tax increase because of his salary and book deals. A lot of people don’t have the same income and can’t instantly quit just because of a tax increase.
Oh, boo fucking hoo.
May 2nd, 2009 at 11:15 am
“It has nothing to do with “cultural puritanism,” whatever the hell that is. It has everything to do with people who deliberately indulge in risky behavior paying the costs that predictably flow from that behavior. Hope that helps.”
It doesn’t help because, of course, this is not why we tax cigarettes.
If it was, we’d tax bungee jumping and working in coal mines too. But we don’t.
- We don’t tax cigarettes because we want the users to bear the future costs of their behavior.
- We do tax cigarettes because tobacco is both destructive and addictive, and we want to make it a bit more difficult for folks to get addicted.
Folks like Matthew (and many others) seem incredibly unclear on this point.
Think about the limited number of areas where sin taxes are collected with general popular support: tobacco, alcohol, and gambling. All of these have a significant addiction problem.
We’re not trying to make smokers, drinkers, and gamblers pay for their societal costs. Instead, we’re trying to reduce general levels of addiction to tobacco, drink, and dice.
In short, it’s a pretty bad error to think of sin taxes as user fees.
Hope that helps, but I suspect it won’t. There are a substantial number of idiots who have strong opinions on this issue precisely because they are cultural puritans.
May 2nd, 2009 at 11:30 am
“There are a substantial number of idiots who have strong opinions on this issue precisely because they are cultural puritans.”
Well, I’ll defer to your authority on the subject of idiocy. You seem to excel in that behavior.
For the rest of us, the idea that sin taxes both can deter and can pay for at least some of the costs of self-abuse are not mutually exclusive. I’m sorry you find this so hard to understand. You clearly have strong opinions on this issue precisely because you have to believe that others can only be motivated by “cultural puritanism” (whatever the hell that is).
May 2nd, 2009 at 11:58 am
Re Joel at 32 and 33:
———–
Whew. I was afraid that when you referred to taxing for the cost to society of “self-abuse” you were referring to ..you know ..spanking the monkey.
Which admittedly would be a damm quick way to balance the budget. Although it seems to me that collection would be a problem without an undesirable expansion of current government surveillance programs.
May 2nd, 2009 at 12:09 pm
As someone who quit smoking 25 years ago — and who later contracted Type II diabetes from the subsequent weight gain, I would suggest that the situation is somewhat more complex than Joel suggests.
Many of our health problems result from the corporate rat race — people working long hours and hence being too tired to exercise, eating what’s in the vending machines, stress, etc — and yet that rat race is arguably the goose that lays the golden eggs.
At least it is if your career is based upon raising $700 Million in contributions for a political campaign.
Also at least some obesity is the result of genes that were well suited for Ice Age conditions but are less so for modern life. Do we assess based upon genetic makeup? Do DNA tests prior to levying insurance premiums? Isn’t the purpose of insurance to spread costs across a large population.
One can say that those guilty of “self abuse” should pay for their “irresponsibility”. But do doctors , soldiers or corporate executives who work stressful 80-hour weeks but who smoke contribute less to society than some housewife who is in great shape because she lays on her ass and bitches at the maid?
As Winston Churchill noted during World War II, most of the world’s work is done by people who don’t feel very well.
May 2nd, 2009 at 12:23 pm
Or should I say –pundits whose sole contribution to society is to sit on their asses and bitch about the sins of the masses?
Do we really want to screw policemen, firemen, and soldiers for smoking as a way to deal with the stress and danger of their lives?
If Joel is going to be our beady-eyed little accountant, could he tell us if the additional health costs of the sinners are outweighed by the savings to Social Security and Medicare resulting from their early demise?
An increase in the death rate might let the government get out from under those $40 Trillion in unfunded liabilities.
Plus, if Joel is such a cost-saver, where was he when Bush was launching an unnecessary $2 Trillion war and letting Wall Street cause a $10 Trillion financial trainwreck? Seems to me our wealthy elites should let the hoi polloi have a few indulgences — in the hope that said hoi polloi won’t chop the elites’ fucking heads off.
May 2nd, 2009 at 1:13 pm
Man, you try to raise a little cash for the government on the sly and everyone goes crazy. You can’t slip nothin’ by nobody these days.
May 2nd, 2009 at 1:47 pm
” . . . where was he when Bush was launching an unnecessary $2 Trillion war and letting Wall Street cause a $10 Trillion financial trainwreck?”
Voting for the opposition. Donating money to the opposition. The Bush administration was a disaster for this country. I’ve never defended it.
Don, your smoking, your weight gain and your job are your choices. Quit posturing as the victim. Of course, you’d have to exercise a little self-control–not not mention just exercise. And maybe you (and others) could decide that making gobs of money isn’t worth the stress if you can’t handle it without losing control of your weight.
I’m sorry to tell you, but this ain’t hard. There are plenty of habits, plenty of jobs and plenty of hobbies that don’t require you to smoke, become obese and to stress beyond your ability to cope. Take a little personal responsibility.
May 2nd, 2009 at 2:49 pm
Joel, your wallet is clenched to tight it may be harmful to your health, not to mention painful. But that’s OK, I’ll let you share my health-care pool anyway.
However, you might feel better – healthier, even, at least mentally – if you try to be a little less judgmental of other people’s choices.
May 2nd, 2009 at 3:24 pm
Paul may be onto something there about the trade-offs in health care costs between treating lifestyle-related and old age-related diseases. But he flushes down the crapper anything remotely worthwhile in his post when he lays this stinker on us: “. . .the notion we can cut health care costs significantly by getting people to drink less soda and eat fewer Doritos is unsupported by any evidence.”
Maybe I’m supposed to read his book to see what kind of homework he’s done on this topic, but 15-20 minutes searching on Medline suggested to me there are numerous studies available that could rebut such a bold statement.
It’s a clever ploy to make health promotion initiatives one of the fronts in the culture war (the new Puritans, indeed). Nice try, but it’s still only another example of manufactured uncertainty, to defer any meaningful action on reducing health risks and improving quality of life through lifestyle changes (read David Michael’s book, if you want see what manufactured uncertainty is about). Arguing that health promotion is a right-wing issue is also specious. Wingnuts also have made the point that health promotion advocates were fascists because the Nazis had smoking cessation programs.
May 2nd, 2009 at 8:12 pm
leaves revenue as a percent of GDP far too low to pay for the government services we need:
The amount of federal revenue that comes from excise taxes is less than 5% of the budget (and obviously an even smaller % of the GDP). And raising them has always resulted in a revenue % gain less than the % tax increase. Of the top of my head, I think the cigarette tax increase of 150% (up 61 cents from 39 cents to a dollar) was projected to increase revenue by 130% (up 8 billion from 6 billion to 14 billion) – because some 15% of people were projected to stop smoking because of the increase.
Now, smoking has already seen a pretty sizable drop off (a lot due to previous state tax increases), so the elasticity of demand for that ’sin’ is currently likely on the low side. But for many other ’sin’ taxes (including gasoline if you want), you’re likely going to reach diminishing returns pretty quickly as you’ll be hitting the front end of the wave of people who will switch to other options or just quit entirely. Which, as has been mentioned before, is the ostensible rational of sin taxes; counting on them for government revenue growth is counterproductive and more than a tad hypocritical.
May 2nd, 2009 at 10:57 pm
I dunno — It seems to me that this is all about “let’s fuck the working poor –their lives aren’t miserable enough already”.
Because if you want to discourage the wealthy and powerful, you need to jack THEIR excise taxes way up. Make President Obama, for example, pay $100 for every pack he smokes.
I myself would prefer that the President not be wrestling with the throes of nicotine withdrawal while he’s deciding , for example, whether to start major military operations against nuclear armed Iran and its ally nuclear armed China. Or when he’s deciding whether he’s gonna take any more shit from Putin re Georgia. Even a limited nuclear war would make our healthcare costs soar way out of sight.
Of course, Obama is hurting his health in the long term –so I think he deserves our gratitude for putting the health of the nation first. THANK YOU FOR SMOKING, MR PRESIDENT!
May 2nd, 2009 at 11:03 pm
It seems to me that the group that is buttfucked by Joel’s attitude are blue collar workers — like the coal miners I grew up with. They smoke because (a) it helps filter out the coal dust and puts off the day when they have to start sucking on oxygen tanks because of black lung and (b) they’re likely to have a 1 ton piece of slate drop on them before they reach 60 anyway.
Of course, last time I checked about 50 percent of our electricity is still generated from coal. And without electricity, our cities die. Of course, gay metromales in the fashion industry don’t realize this — they think fairies from Ireland make the lights go on when the switch is flipped.
So maybe instead of fucking the coal miners, we should fuck the metromales. Put an excise tax on every dumbshit comment posted on the Internet — because such unfairly burden society with white noise in policy debates, are a drain on Internet bandwidth, and consume unnecessary electricity to run the server farms.
May 3rd, 2009 at 3:40 am
@46 There’s approximately 80,000 total coal miners in the U.S. Less than 100 a year die in coal mining related accidents. Long term health prospects of coal miners have improved with increased health and safety regulations requiring mines to have coal dust filtration systems and the availability of individual filtration masks/respirators. Curiously enough, medical studies don’t seem to show that cigarette smoke has a beneficial effect for coal miners. In fact, rather than filtering out coal dust, cigarette smoke combined with coal dust inhalation causes even greater damage to human lungs than either one alone.
May 3rd, 2009 at 3:45 am
Smoke’m @20: No, because the costs of malpractice suits and such are a tiny, almost neglible, part of the whole health care costs.
May 3rd, 2009 at 10:34 am
Re Dave R at 47: “There’s approximately 80,000 total coal miners in the U.S. Less than 100 a year die in coal mining related accidents. Long term health prospects of coal miners have improved with increased health and safety regulations requiring mines to have coal dust filtration systems and the availability of individual filtration masks/respirators.”
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1) About 1000 coal miners still die per year from black lung disease.
And the decline in those numbers from earlier years is mostly the result of the decline in coal miners , as the industry has shrunk.
Ref: http://www.msha.gov/s&hinfo/blacklung/homepage.htm
May 3rd, 2009 at 9:25 pm
“However, you might feel better – healthier, even, at least mentally – if you try to be a little less judgmental of other people’s choices.”
LOL! Can’t stand the truth, so you attack the messenger, eh, eb?
“They smoke because (a) it helps filter out the coal dust and puts off the day when they have to start sucking on oxygen tanks because of black lung . . . ”
This is pure, unadulterated rubbish. By what mechanism does injecting smoke and tar into a miner’s lungs “filter out the coal dust?” That comment is stupid on stilts.
You are a fool, Don. A proudly ignorant fool.
May 3rd, 2009 at 11:51 pm
Re “You are a fool, Don. A proudly ignorant fool.”
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Really?
I worked for 15 months in a coal mine to get through college. What’s your experience?
None, is my guess. Because you would get your stupid little social-engineering ass whipped if you ever showed up in a real coal mining town — or any place else where people have to do real work for a living.
May 4th, 2009 at 9:08 pm
[...] care and life style changes came up in the blogosphere in an exchange between Paul Campos, Matthew Yglesias, and Ezra [...]
May 4th, 2009 at 10:46 pm
Here’s an idea – CUT SPENDING
May 4th, 2009 at 11:02 pm
The new puritanism seems to be rivaling the old for ugliness; the old New Englanders’ version was based on a perverted notion of God, this version seems to be based on selfishness – “I won’t pay for these fat / drunk / smoking / meat-eating / non-jogging wankers.”
May 4th, 2009 at 11:05 pm
So if I eat bran and put in my 30 minutes a day of government-mandated exercise, and I still get cancer or diabetes or run over by a bus, do I get that tax refunded? Not bloody likely, huh?
Smoking is an easy target because there’s a very clear causal link between the activity and negative health effects. Amazingly, though, not every activity with a negative health effect is a direct result of an unhealthy lifestyle choice. There’s a lot of individual variation within that, as well – some people can eat whatever they want and stay skinny, some people can get fat off rice cakes. It’s absolutely certain that any regulatory scheme you come up with is going to fail to take individual differences into account; in fact, it probably has to, lest it run afoul of anti-discrimination laws and due process claims.
At the end of the day, though, if we want to encourage healthier outcomes, aren’t there better ways to do it? Instead of taxing high-fructose corn syrup because it’s especially unhealthy, why not -stop subsidizing it- and let companies go back to using good old sugar? It’s good for your budget and good for your gut! But it’s bad for presidential candidates in the Iowa caucus, so I guess it’ll never happen…
May 4th, 2009 at 11:43 pm
Heh. When you get to the point where taxing the rich isn’t enough, you might want to consider that expenses are too high. OTOH Maybe the bottom half of the country should pay income taxes again.
Well that’s just crazy talk! Matt already told us, we need these government services.
And as far as taxing the bottom half of the country, you clearly have no heart! So try to focus on a tax policy that will encourage correct behavior (work, of course, not being one of those behaviors).
May 4th, 2009 at 11:46 pm
We should probably raise taxes on people who are a strain on the public healthcare system: Smokers, the obese, people with HIV & AIDS, STDs, runners, etc…
May 4th, 2009 at 11:51 pm
Raising my taxes will discourage all kinds o’ behavior. It will discourage me from hiring house painters and lawn mowers. It will discourage me from building a deck. It will discourage me from contributing to the income of waiters, waitresses and cooks. It will discourage me from contributing to the income of workers in the travel industry. It will discourage me from working as hard next year because I decide that the effort isn’t worth the marginal return, so I will pay less in taxes. I’ll spend more time with the family and play more golf (at public courses). All those who depend on the spending of evil over $250k upper middle class America will LOSE, and the government will LOSE tax revenue. We don’t work for you. Good plan, Matty.
May 4th, 2009 at 11:56 pm
See Dotar? The plan is already working. You are now spending more time with the family and playing more golf. You are thus better exercised and less stressed, and less of a burden on the health care system. Now those resources can be reserved for the people that need them.
May 5th, 2009 at 12:24 am
So, taxing unhealthy behavior.
One could make a very good case that sodomy & homosexual men having sex with men are unhealthy behaviors, associated with several diseases and health problems of the mechanical sort.
So, Matt, are you up for a sodomy tax?
How will you enforce it?
Oh, I assume you aren’t. So are you going to tax me for eating ice cream tonight instead? What if I told you I had that ice cream after running for 20 miles?
Social engineering doesn’t work.
May 5th, 2009 at 4:08 am
[...] Looking at the gap between revenues and costs for Obama’s health care plans, Matt Yglesias over at ThinkProgress.org makes the following observation: That dotted line already assumes you’re repealing Bush’s tax cuts for the rich. You could—and we probably should—raise taxes even further on the rich. But I don’t think there’s a realistic way to get all the way to where we need to go purely through that mechanism. So the isse [sic] becomes that if you’re going to have broad-based sources of revenue, it makes sense to obtain a decent chunk of that revenue through taxes that, at the margin, encourage healthier behavior rather than through taxes that, at the margin, discourage economic activity. [...]
May 5th, 2009 at 4:52 am
Pres Obama promised a pay as you go methodology. This very claim was used in political discussions to persuade me he should have my vote. When is that gonna happen?
Heres a novel idea… lower taxes on the harmful activity of productivity, freeze spending, and we outgrow the issue altogether.
Some of you have mentioned that an unhealthy lifestyle is tantamount to theft. Its only that way because the govt is in the business of entitlements in the first place. And inherent in that argument is that the Govt has the right to control your behavior. How does that feel, my fellow serfs?
May 5th, 2009 at 7:55 am
No, because the costs of malpractice suits and such are a tiny, almost neglible, part of the whole health care costs.
They are, by the same token, concentrated almost entirely at a tiny, almost negligible part of health care costs – doctors.
May 5th, 2009 at 8:44 am
Numbers please! How much could be raised by cloning and farming the rich into pods where they both surrendered all their ill-gotten assets and invested 24/7 for the benefit of the government? How far down the income scale would we have to go with Pod People Income Payments (PPIP-2)giving literally everything to the government in order to ensure equality for every man, woman, and child of every ethnicity, gender, sexual preference? $75K per year? Seems like that would about do it.
Farm ‘em. That’s the ticket–time for the rich to pay reparations to the rest of us.
May 5th, 2009 at 9:36 am
Dear Matt,
Define “we” and define “need”. I’m not one of your “we” and I don’t necessarily need the services you want.
In the future, speak for yourself, pal.
May 5th, 2009 at 9:55 am
Who exactly do you think gets type II diabetes, dies early from heart disease and doesn’t get enough exercise? It’s not the folks playing tennis at the country club three days a week. By and large, the rich don’t smoke and aren’t fat – these taxes wallop poor and lower-middle class people. Keep taxes on tobacco high enough that poor teenagers don’t start smoking – otherwise find non-punitive ways to increase quality of life.
May 5th, 2009 at 11:13 am
“You could—and we probably should—raise taxes even further on the rich.”
Yeah, because the fact they pay the huge majority of income taxes in this country shouldn’t stop you from confiscating more of the money they earned, should it? For all the bullshit about the Democratic Party being the “party of ideas” (because trumpeting ideas from the 1930’s ie the new New Deal is groundbreaking stuff)it seems the only one they can come up with is “spend a shit load of money to buy votes, and then tax the rich”.
May 5th, 2009 at 11:18 am
“Pres Obama promised a pay as you go methodology. This very claim was used in political discussions to persuade me he should have my vote. When is that gonna happen?”
Hahahahahahahahahahaha. In order for this guy to pay his budget as we go, he would have to tax you from the moment you left the womb. Amazing how the very same geniuses who trumpet Obama’s so-called tax cut (though not a single, solitary rate was cut)for the middle class turn right around and demand we tax people based upon lifestyle choices. I think that huge $10/wk extra you are getting will be gone pretty fast, don’t you?
May 5th, 2009 at 11:27 am
As you can see, Obama administration’s budget…leaves revenue as a percent of GDP far too low to pay for the government services we need:
I’m with Mark – I don’t need these services (farm subsidies, ponzai schemes, GM bailout) and I won’t pay for them. I have removed myself from the ‘evil rich’ list as well so you all can tax someone else.
May 5th, 2009 at 12:50 pm
I like this blog post only because its transparent. Raising taxes on “unhealthy” habits won’t save the government any money or change the habits significantly. And the virtue of “progressive taxation” is not so virtuous when the coffers are running low. So all of the principles arguments aside, yeah it’s just about the money.
May 5th, 2009 at 1:37 pm
What about raising taxes on unhealthy sex habits, illegal drug use and accepting blood transfusions? Those things are all vectors for the spread of AIDS and other chronic diseases like Hepatitis. Those things cost society an absolute sh1t ton of money, and I don’t see why I should have to pay for them. Hello? Hello?
Dang, it got quiet in here fast.
May 5th, 2009 at 1:38 pm
I think it’s important to have this debate, and while I passionately disagree with almost every (but not all!) utterance that Matthew makes, I applaud him for his openness.
Two questions:
1. Who decides what is healthy and what is unhealthy, and how precisely is it enforced? For example: one-two glasses of wine are supposed to healthy; what happens if I have four?
2. What exactly are the government services we “need”, and does cost matter at all?
If Matthew ever makes even a token attempt to answer these questions I will be most impressed. I’m sure I’ll die of shock (as would many – but not all! – of his readers) if that happens, but then we could tax his blog for being unhealthy.
May 5th, 2009 at 2:54 pm
Wow–for a lefty website there is certainly an abundance of sensible comments. Mr. Yglesias’s comments certainly suggest an implied communal ownership of the assets/earnings of the most productive taxpayers, as well as a puritanical approach to reducing pleasurable activities through taxation. If true, consider the following policies (given as examples of the folly of Matt’s premises): (1) Tax all sexual activity unless the sexually active person posts a bond to pay for all costs of the activity; motherhood (especially single motherhood, with its increased sociological risks to the offspring), HIV/AIDS, other STD’s, abortion, handcuff burn treatment, etc. (2) Tax all food consumed in excess of 1500 calories/day for adults. (3) Tax all persons out in the sun who aren’t using sunscreen. (4) Tax all persons with BMI > 25. (5) Progressively increase taxes on alcoholic beverages until E.R.’s record alcohol-related accidents (motor vehicle and otherwise, domestic violence while drinking, alcohol intoxication (especially underage)) at zero percent. (6) Legalize drugs, then tax all illicit drugs (smoked, injected, snorted, ingested) by the same multiplier (tax divided by cost-to-produce) as it taxes tobacco. (7) Tax all recreational activities likely to result in injury/medical costs, such as skiing, softball, racquetball, etc. (8) Tax all vegans with insufficient protein intake. Like user-taxes, these can be collectively called abuser taxes.
May 5th, 2009 at 5:51 pm
If these unhealthy habits equal “theft”, in the form of disproportionate spending of govt resources on the abusers rather than the healthy.. Then why not outlaw the behavior?
Because it’s NOT about discouraging behavior. Yglesias knows it. It’s about growing and expanding govt control. And the method is creating more bureacracy, to “fix” the consequences of the last bureacratic “fix”.
Oh. And to buy more votes under the guise of how compassionate we are.
We don’t need a crystal ball to see where we are headed. Just look at California’s fiscal situation.
May 6th, 2009 at 2:32 pm
Schizophrenics like to self medicate with tobacco – a LOT.
Schizophrenia and Tobacco
And they are among the heaviest of users. So maybe we need a Schizophrenia Tax. Or an increase of the current Schizophrenia Tax.
Maybe there will come a day when only crazy people pay taxes.
May 6th, 2009 at 3:02 pm
If we raise cigarette taxes enough – black market marijuana will be cheaper. Consider a pack a day guy. At $5 a pack that is $150 a month. That is a fair amount of pot.
May 6th, 2009 at 3:05 pm
…health promotion advocates were fascists because the Nazis had smoking cessation programs.
And fascism was a variant of socialism. You know National SOCIALISTS.
May 6th, 2009 at 3:08 pm
[...] 000-005: Middle Class Tax Rates The numbers show that His Excellency, President Obama, will be required to implement a tax increase for the middle class. Many of you have been speculating about this in private forums. This a reminder that you must NOT [...]
May 6th, 2009 at 5:06 pm
After eight years in which the preposterousness of supply-side economics was demonstrated, we are now about to demonstrate the preposterousness of funding big government with steeply progressive taxation.
In both cases, it comes down hack politicians promising the mass of presumed voters something for nothing.
The revenue gap cannot be made up without heavily taxing almost everybody. And Obama should be honest about that. Instead, he wants to get his programs through, unfunded, and present the bill later — or leave it to his successor. Remind you of anyone?
Same circus, different clowns.