Tag Archives: Philadelphia sin taxes

City to Citizens: Please Smoke and Drink More

The city of Philadelphia has a revenue problem – or, to be more precise, a not-enough-revenue problem.  Its school district faces a deficit of more than $300 million, and while city officials hope to get most of that money from their state government – which, technically, runs the city’s schools and, in withholding money, is failing to fulfill a responsibility it strong-armed away from the city more than a decade ago – they understand that before the state will help them, they’ll first need to demonstrate that the city is prepared to do its part, too.

Enter sin taxes – you know, extra taxes governments levy on things that are supposed to be bad for us.

Just a few years ago, Philadelphia’s mayor, facing a budget shortfall of his own – the city and school district are separate – proposed a tax on soda and other sugar-sweetened beverages.  He said such beverages harm people and that the tax could both discourage their use and help pay for programs to encourage people to cut down on their, well, on their sinning.  He failed:  people saw right through his silly attempt at gimmicky governing.

Now the mayor is targeting a whole new set of sins, proposing a new tax of two dollars on every pack of cigarettes sold in the city, with all of the new tax revenue going directly to the school district.  He also wants to increase from ten to fifteen percent the current tax on every glass of alcohol sold at local bars and restaurants.

Let us set aside, for the sake of discussion, the very real possibility that the sinners, faced with these new taxes, will simply choose to make their sinful purchases outside the city limits.  Let us also set aside the problem of labeling as “sins” products that are legal.  If they were that bad, wouldn’t their use be against the law?  (The Curmudgeon would love to argue that they should, in fact, be against the law, but that’s an entirely different subject.)

Part of the dubious premise of sin taxes is that there’s no proof they work – no proof, that is, that making people pay an extra fee to engage in their dubious consumption will actually curb that dubious consumption.

But an even bigger part of the dubious premise is the possibility that one day, a sin tax might actually work – and work well.

Work too well.

Consider this:  Philadelphia city officials estimate that their cigarette and booze tax would raise about $65 million for city schools.  But what if it doesn’t?  What if people who drink at bars and restaurants and smoke cigarettes find the taxes so onerous – remember, Philadelphia has a pretty large population of low-income residents – that they curb their evil ways and reduce their consumption of these sinful products?

That would be a humdinger of a problem for city officials, wouldn’t it?  After all, they’re betting on their new sin taxes raising $65 million a year, and if the taxes work and reduce consumption, they won’t raise what’s needed and city officials will be back at square one, looking up at a big school budget deficit.

So where does that leave the city today?  it leaves the city of Philadelphia in the business of depending on its residents’ smoking and drinking habits for its financial health.  It is, in fact, now in the ridiculous position of needing to encourage people to smoke and drink – and maybe, even smoke and drink more than they ever have.

Ultimately, this is about bad government – really, about government with neither courage nor vision.  It’s about politicians for whom the end goal is gaining (and retaining) office, not achieving something once they do.  Philadelphia, for example, has an infrastructure that was essentially designed in the late 1950s and early 1960s, when the city’s population was a half-million greater than it is today.  As a result, it has too many schools, too many playgrounds, too many libraries, too many swimming pools, and too many city employees for such a scaled-down population, but the easiest way to turn a politician into a frightened demagogue is to threaten to close a facility in a favored neighborhood.  Somewhere in the depths of city government is the money to run the schools, but it would take someone with real intestinal fortitude to go get it.  Today, the city’s government is led mostly by people sadly lacking in such fortitude.

And that leaves governing with gimmicks – gimmicks that make the city’s government the equivalent of Joe Camel, the Dos Equis guy, and the National Football League:  pimps for the tobacco industry and pimps for the beer and wine and hard liquor industries.

So what are these, pardon the expression, leaders telling the people they are supposed to be leading?    The are telling them to become chain-smoking, beer-drinking, wine-gulping idiots so the extra taxes they pay will help prop up the city’s financially beleaguered schools and benefit the 150,000 children who attend those schools.

That’s right:  drink more, smoke more.

Do it – for the kids!