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First off, I want to say that I don't smoke.
On the one hand, if people find pleasure in doing something that will most likely lower their life expectancy that's just fine by me. We're all going to die someday. Smokers should be aware of the risks by now. I'm generally not in favor of government attempting to dictate risk management onto individuals.
On the other hand, I am in favor of smoking bans to protect me from smoke in public places and the workplace. That does not mean that I would be opposed to private restaurants that allow smokers to smoke though, since nobody is forcing me to patronize them. Further, one would think that in a capitalistic society, the free market itself would eventually open up at least a few smoke-free restaurants to cater to my desires.
So anyway, that's my stance on smoking.
We are repeatedly told that smokers are a financial burden to us all. It is used as a justification to increase the taxes on smokers as a way to pay for it. However, is smoking actually a financial burden on society?
May 14, 2009
Do smokers cost society money?
A Dutch study published last year in the Public Library of Science Medicine journal said that health care costs for smokers were about $326,000 from age 20 on, compared to about $417,000 for thin and healthy people.
The reason: The thin, healthy people lived much longer.
It seems that the "smoking burden" myth falls into the Iraq's weapons of mass destruction filing cabinet. Big surprise there.
Now there is talk of a soda pop tax.
Pro-Con Should Congress tax soda pop to pay for health care?
Let's start with the "No" camp first. That's the camp I'm in. It's a tax on food. That means it hits the poor the hardest (since the poor spend a larger percentage of their incomes on food). How is that even remotely fair?
You know how everyone was telling us to invest in “Forever” stamps before the postal rates went up this week?
Here’s an even more useful tip: Stock up on soda.
Been there, done that.
Here's a glimpse from the "Yes" camp.
The thinking, in part, is that, as with smoking, those who sell soda and those who consume soda ought to help pay for the cost of health care associated with the product.
As seen above, smokers do not appear to be a financial burden on society. They cost more per month (as seen in insurance rates for smokers vs. non-smokers) but they live fewer months. Further, it doesn't even speak of the savings to Social Security and Medicare as smokers die earlier than average. If we based the tax solely on the thinking that smokers "ought to help pay for the cost of health care associated with the product", then smokers should actually be given a rebate, not an extra sin tax.
Why is it automatically assumed that those who consume soda will be a financial burden too? It is not possible to remain permanently healthy no matter what we do. Eventually, we all become less healthy and at some point we will all die. Prolonging it seems to me to be the bigger financial burden on society. Picture what would happen to Social Security and Medicare if we all live to be 100 years old.
I really didn't want to go down this path. I don't enjoy putting a price on human life. However, that's exactly what the government is trying to do with these sin taxes, and in my opinion they've got the math completely backwards.
The true sin is finding new excuses to tax the poor while turning a blind eye to the outsourcing of jobs to China, India, and Mexico. In this respect, I'm completely in favor of sin taxes. Let's tax the sinners.
January 6, 2009
Congress just took a pay raise - Didn't they tell you?
I think it's a mighty fine thing that we taxpayers can afford to give our duly elected representatives a raise in pay. It's a sure sign of how well we are doing as a nation. Never mind the fact that the recent congressional pay raise of $4,700 equals almost 20% of what I earn annually, or equals about 10% of the annual salary of a teacher, fire fighter, or cop. Those hard working legislators deserve every dollar they get -- all $169,300 of them.
Real Estate Newsletter Articles this Week: Existing-Home Sales Increased to
4.15 million SAAR in November
-
At the Calculated Risk Real Estate Newsletter this week:
[image: Existing Home Sales]*Click on graph for larger image.*
• NAR: Existing-Home Sales Increase...
11 hours ago
17 comments:
Oh man, first the gold issue and now smoking! I think StagMark and me are meant to be in dialogue!
I do smoke. Sadly I started very late, at about age 22. Last year the wife and I quit, using chantix for 6 months. It was great if you discount the severe stomach pain and the 3 months that I did not sleep! I restarted about 2 months ago.
The biggest risk of smoking is heart disease, but the stats are skwewed because the same population that smokes in the biggest numbers is the same pool that takes poor care of themselves. It is a "corrupt" data set. Cancer risk is elevated, but the sad fact is only 1 of 5 people will get cancer and even subtratcted for smoking, the stats do not change, and it is VERY family related. If the smoking tax went away, all 50 states would go broke, so in a clown Keyenesian way its good.
Again, only a complete idiot would smoke cigarettes, you have to be totally stupid. I am.
Anyways, love the blog and I was almost laughing myself to death writing the "letter" to Patterson tonight.
PS What did you think of the rock blogging?
GYSC,
I am NOT suggesting that smoking is a good idea!
I'm just heckling the idea that smokers are a huge financial drain on society and are therefore easy targets for taxation.
We have to be taxed. That much is clear. Let's at least tax fairly. I argue that a lot of these sin taxes target the poor far more than they target the rich. I'm also a believer that the rising income inequality is/was a major part of our economic problems (as it was heading into The Great Depression).
Taken to the extreme, "subprime" hamburger is clearly more dangerous than top quality prime rib (if meat recalls are any indicator). So do we slap some taxes on "subprime" hamburger too?
While we are at it, should we ban white bread? We all know it isn't that healthy.
Let them eat cake?
Cheap cars are generally not as safe as luxury cars. Slap some taxes on them too?
Living in a poor neighborhood isn't as safe as living in a gated community. Perhaps an extra property tax sin could be imposed to help pay for the extra law enforcement needed?
See what you've done? I'm thinking like a politician and I'm feeling very dirty now. Sigh.
I'm taking you down with me though, lol. Brace for it!
Our governor talked of slapping a sales tax on gold bullion before the election (in addition to the capital gains tax it already has), and she actually won the election. There's been no further mention of it that I know of, but that sort of taxation thinking might appear if gold hoarding is thought to be a sin by a goverment running big deficits someday. Just something to think about.
Let's hope you don't start Friday Night Rock Taxin' Bloggin' someday. You'd probably need much darker songs! Hahaha! Sigh.
Stag,
I'm not sure if I've posted my solution to our health care here before or not. Anyway:
http://en.wikipedia.org/wiki/Christian_Science#Medicine
I'm joking, but in a serious kind of way.
After we're done bailing out the banks and the wealthy, money is going to become very scarce. I seriously doubt money will be available for meaningful health care reform. Most can expect to work longer and receive less as far as social security is CONcerned too.
What a system. What a sham(e)!
These bailouts are infuriating.
The dangers of smoking cigarettes may be one of the few things that "everyone knows" about health and lifestyle that is actually true. For instance, the "thin and healthy people" remark implies that the thin live longer. But they don't, it would seem - it's better to be "overweight" though not, I gather, "obese".
dearieme,
You make a good point. I remember reading that "thin" and healthy isn't the healthiest.
Here's another link that also includes the cost of obese care.
http://seattletimes.nwsource.com/html/nationworld/2004164306_health05.html
"Cancer incidence, except for lung cancer, was the same in all three groups. Obese people had the most diabetes, and healthy people had the most strokes. Ultimately, the thin and healthy group cost the most, about $417,000, from age 20 on.
The cost of care for obese people was $371,000, and for smokers, about $326,000."
Still looking for some kind of data on "average and healthy".
dearieme,
I now remember what I'd read in the past. Being thin does not guarantee being healthy. An active overweight person can be healthier than a sedentary thin person.
The "healthy" part of "thin and healthy" is no doubt doing most of the work.
mab,
From your link...
"Most Christian Scientists are practical when it comes to using material aids such as vision correction, splints for broken bones and dental services and will use what seems appropriate at the time."
Most? I would have died had my appendix not been removed. My gall bladder is gone too. I've had a broken collar bone. I'm wearing glasses so that I can see. I've got a few crowns in my mouth and quite a few fillings. I also had 78 stitches once thanks to a dog being attached to my face as a kid.
Thank God I'm an agnostic! Badum-ching!
"I'm joking, but in a serious kind of way."
I hear that! Hahaha!
Stag,
I strongly believe that when push comes to shove, money interests will trump social secutity and medicare promises. Private/municipal pension & medical promises won't be met either.
I defintely foresee benefit cuts. We've squandered our wealth. A Christian Science type medicare rationalization for the majority is in the offing.
Today's CEOs, financiers and politicians have no honor. It's all about the bonus. Shortermism. The social security & medicare surpluses have been looted. All part of the biggest swindle in history.
Benefit cuts are coming, I'm certain of it.
Clawbacks? We can't do that, it's "time to move forward." And you can't raise taxes in a recession, every eCONomist says agrees. But you can renig on promises.
Anything for the eCONomy.
Oh well, at least real estate prices in the Hamptons will be somewhat insulated.
What a sham(e).
Hahahaha! Suckers.
mab,
What you are suggesting is just an extension of what we are currently seeing.
On the cover of Time magazine's May 25th edition it says, "You can kiss your benefits goodbye too." No joke. The theme is, "The Future of Work."
It also says, "...but there's a world of opportunity if you figure out a new path."
Good luck on that one! If you figure it out? If? Something tells me that millions of unemployed are not going to figure it out.
As a side note, what exactly did George Jetson do for a living? I know he went to work, but why was he needed? Everything else seemed automated, even the maid.
Stag,
As a side note, what exactly did George Jetson do for a living? I know he went to work, but why was he needed? Everything else seemed automated, even the maid.
It was more of an illusion of "work." Much like bankers working and "earning" their bonuses.
http://en.wikipedia.org/wiki/The_jetsons#Plot
mab,
Holy cow! I had no idea that The Jetsons had such an impact on me. I just remember it in bits and pieces.
"George's work day consists of pressing a single computer button. Despite this, characters often complain of exhausting hard labor and difficulties of living with the remaining inconveniences."
I've used that single computer button extrapolation many times. Thanks for pointing out where the seed was planted in my head!
Reality will never meet up with fiction (the illusion).
"George Jetson works three hours a day and three days a week..."
Not going to happen in a capitalistic society. Automation will allow some workers to do the work of many people as they continue to work 40+ hour weeks. The rest will be in the unemployment line. Those that are still working won't see huge pay raises though (as there will be a glut of workers perfectly willing to do their jobs cheaper).
This can be seen in farming jobs. There are fewer and fewer workers but they are working far more productively as machines do more and more of the work.
Non-farm payrolls came first. From the standpoint of companies, it was a resounding success. Next up, non-banking payrolls (computers doing more and more of the work) and non-retail payrolls (automated checkout lanes and the computer driven Internet doing more and more of the work).
In theory, we could use non-sense payrolls to fill the gap (government jobs to dig holes and then refill them). Just one problem. Non-sense jobs would create a serious drag on our country's ability to compete in the global marketplace.
I see no solution for the mess we're in.
Stag,
Not going to happen in a capitalistic society.
Well, it's definitely not going to happen in our current society. But I'm not sure capitalism is the reason.
In my view, we have two economies. The first economy produces real goods and is ruthlessly competitive. It punishes mistakes and waste. It demands ingenuity, efficiency and constant improvement.
The second eCONomy is the credit producing and absorbing eCONomy. It operates separate from the goods producing economy and is not competitive in the usual sense. The credit eCONomy consists primarily of the finance and real estate industries. One produces, one absorbs credit. The credit eCONomy's growth is guaranteed by the system's need for new debt. The sham eCONomy is extractive and yet it is perceived to be critical for the health of the real economy. That perception is a big lie.
If we were to suddenly and cheaply solve our energy needs tomorrow what would happen to the two economies? Which would fare better? Keep in mind that credit must always expand.
The more successful the real economy, the more expensive the sham economy's products like stocks, bonds and real estate must become. Yet the ability of the goods producing economy to afford said products diminishes with its successes. A unfair outcome in my opinion.
Bernanke & Greenspan were very foolish in allowing stocks and real estate to become so far over-valued. Inflating credit from here is near impossible. Absent the government legitimizing all the sham credit via guarantees and new debt, our system would have imploded.
Imo, when Buffett says he only invests in businesses he understands, he's not saying he doesn't understand tech. I believe he is saying that he doesn't see how any tech investment can withstand the ruthlessly competitive environment over time. Very few techs do. And even then, their initial fat margins are squeezed.
Buffett has no such qualms when it comes to investing in shams. Until recently, shams have had a "durable competitive advantage." Buffett has always had a very good understanding of credit and inflation. That said, I can't figure out how he missed the housing/credit bubble. In any event, he seems to have refound his bearings - with the help of the government.
Creative destruction only applies to one of the economies. The majority have been robbed of their hard work.
As long as George Jetson owes money, he will have no peace. As I recall, his wife and daughter were big spenders.
What a system. What a sham(e).
First they raised taxes on the smokers but I wasn't a smoker so I said nothing, then they raised the tax on sodas but I don't drink sodas so I did nothing,...............
Kevin
mab,
Buffett didn't miss the housing bubble. He was a believer back in 2005. How one could see a housing bubble without seeing a credit bubble is anyone's guess though.
Perhaps it was his fear of inflation? In hindsight, I would have done better in the short-term had I had less fear of inflation (not that it really hurt me), at least so far. That being said, there's still plenty of time in the long-term to be justifiably terrified. Eternity hasn't exactly been kind to previous faith-based currencies.
Kevin,
Domino theory!
A guy buys a pack of smokes and a soda and is given too much change. He says nothing.
The next day he buys the same items and is given too much change yet again. He says nothing.
The pattern repeats all week. He says nothing.
The next week he buys the items and is overcharged. He exclaims, "You've made a mistake. This is completely unacceptable!"
The clerk says, "You certainly didn't complain last week."
The guy replies, "I'm a reasonable man. I was concerned by your first mistake. The second mistake made me cringe. The third and fourth mistakes caused me great pain. I bit my tongue on your fifth mistake, to the point it actually bled. Today's mistake goes well beyond emotional and physical harm. I'm now being financially damaged too!"
SPAM deleted.
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