The Economic Impacts of Prohibition

As a part of my analysis of the ISIS survey figures, I’ve been wondering if I can make an assessment of the economic impact when a substantial fraction of the population stops going to pubs and restaurants, sees less of friends and family, and stays home much more.

One question I’ve got is: what is there that such people will spend more money on? Because antismokers say that, even if smokers spend less in pubs and restaurants, they’ll spend more elsewhere, and so there’s no overall economic impact. But if people are staying home, and seeing less of their friends, what might they be spending more money on?

I suppose that, if smokers are spending more time at home, one possible outlet these days is via the internet. They could spend more on music, movies, books, computers. And maybe also on drugs and pornography and online gambling and gaming. And maybe they’d buy more alcohol and take-away meals. The home would become a place of solitary vice.

But I can’t say I’ve done any of these things myself. I spend a lot of time online, but I buy next to nothing there except the occasional book. The thing I have done much more of is mathematics – and that’s a very inexpensive hobby. Has anyone spent more or much more on anything since smoking bans overtook them?

The other thing I’ve been wondering is what the effect of reduced all round spending is likely to be on credit. I don’t have a credit card, and buy everything either with cash or a cash card. But some people seem to buy almost everything with a credit card. I imagine there were quite a few people who would run up a tab at a bar or restaurant, and pay on the way out with a credit card. So what happens when lots of people start using their credit cards much less? What is the response of banks?

My guess is that, if people don’t use their credit cards so much, banks will drop their interest rates to encourage more borrowing, with interest rates acting as the ‘price’ of money. That’s how supply and demand works.

Equally, if people stop spending, they’ll save a lot of money, and they’ll probably look around for somewhere to invest the excess cash, buying shares, bonds, etc. Money will drain out of the economy into these sorts of investments. And it’ll drain out of banks too. So banks will begin to face liquidity problems.

And the financial crisis that began in 2007 (hard on the heels of the UK smoking ban) saw interest rates tumbling, and banks going bust (e.g. Lehman brothers).

I was reading about the economic impacts of US prohibition in the 1920s.

Economics of Prohibition

Prohibition’s supporters were initially surprised by what did not come to pass during the dry era. When the law went into effect, they expected sales of clothing and household goods to skyrocket. Real estate developers and landlords expected rents to rise as saloons closed and neighborhoods improved. Chewing gum, grape juice, and soft drink companies all expected growth. Theater producers expected new crowds as Americans looked for new ways to entertain themselves without alcohol. None of it came to pass.

Instead, the unintended consequences proved to be a decline in amusement and entertainment industries across the board. Restaurants failed, as they could no longer make a profit without legal liquor sales. Theater revenues declined rather than increase, and few of the other economic benefits that had been predicted came to pass.

On the whole, the initial economic effects of Prohibition were largely negative. The closing of breweries, distilleries and saloons led to the elimination of thousands of jobs, and in turn thousands more jobs were eliminated for barrel makers, truckers, waiters, and other related trades.

Sounds like people stayed home back then too. Of course, some people would say that we are not living in a new prohibition era, because the sale of tobacco has not been prohibited. But, while you can still buy tobacco (at vastly inflated prices), you have been prohibited from smoking it almost everywhere. And people are staying home. And bars and restaurants are closing.

One big difference perhaps is that modern Tobacco Prohibition is being introduced piecemeal. In the USA a state-wide ban was introduced in California in 1995, in Delaware in 2002, in New York and Connecticut in 2003, in Massachusetts and Maine and Idaho in 2004, in Montana in 2005, in Ohio and Colorado and Hawaii and New Jersey in 2006, in New Hampshire and Minnesota in 2007, in Maryland and Illinois and Iowa in 2008, in Michigan and Kansas in 2010, and North Dakota in 2012. It’s mostly the southern states which haven’t enacted state-wide bans, but in many of these there seem to be town or municipality bans.

Elsewhere in the world Italy introduced a ban in 2005, Australia in 2006, UK and Denmark and Finland in 2007, France and Holland and Turkey in 2008, all of Canada by 2008, Austria in 2009, Greece in 2010, Spain and Belgium and Poland in 2011.

It’s a creeping global tobacco prohibition. It’s much bigger that US Prohibition. And its effects, in terms of reduced consumer spending, come gradually rather than all at once. It’s a slow, gradual squeeze.

The decade after 2000 also looks a lot like the decade after 1920. Business was booming until suddenly the banks started folding up. And now it seems that all the attempts to boost demand and kickstart the ailing US and European economies (none of which involve lifting public smoking bans, of course) aren’t working.

I’m a bit surprised that no economists are considering the possibility that gradually multiplying smoking bans all around the world are having big effects on consumer behaviour. But then, smoking bans aren’t news. And Tobacco Control is very good at getting across the media message that smoking bans are a ‘great success’, and ‘particularly among smokers’, most of whom, they tell us, ‘want to give up smoking’ anyway. And politicians and the media all believe them, and go along with the ‘success story’. So the economists instead look at interest rates and bank lending policies and the price of tomatoes. They look at everything except smoking bans.

But I think that there’s a good case to be made that smoking bans have an all-round slight negative effect on the economies in which they are introduced, and that these small negative effects add up as more and more bans are introduced, so that as one US state bans smoking and consumer demand falls slightly, it fractionally affects other US states. And the same goes in Europe and everywhere else in the world.

It might be an interesting exercise to take the populations of the various US and European states, and suppose that there’s a 1% or 2% fall in spending in each one when smoking bans are introduced, and see what it amounts to over time as the bans are introduced.

I’ll end with a poll in respect of your local smoking ban, wherever in the world you live:

About Frank Davis

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53 Responses to The Economic Impacts of Prohibition

  1. Iro Cyr says:

    Hi Frank, long time I have posted :-)

    Firstly let me correct you on Canadian bans. They were enacted piece meal province by province with Quebec and Ontario being almost last in 2006 (Alberta I believe was the last in 2008).

    This out of the way, the only thing I spend my money on now is more trips to smoker friendly countries. I take longer vacations and I do it at least twice a year as compared to only one long trip per year I used to take back then. I spend more money spoiling my grandchildren and I also spend it in smoker-friendly Indian casinos in N.Y. state (1 1/2 hrs. from home). Otherwise I spend much less money than I used to in restos, on new clothes, on concerts and what have you.

    Typical of the North American that I used to be, I used to change my car every 4 or 5 years but ever since the smoking ban that has made me feel like an outcast I am in no mood for any luxury or fancy living thus I have had the same car for the last 8 years and I don’t intend to change it anytime soon. All in all I am not having fun as often as I used to but when I do have fun I go all the way and I feel good knowing that I am mostly spending my money outside my province which treated me and still treats me worse than a second class citizen. I will never forget the words of our then Health Minister when one smoker’s rights advocate asked to join the parliamentary hearings on the smoking ban considering that it’s every citizen’s right to be part of the hearings and received this reply from the HM : ”When you’re under the influence of a substance, you no longer have any rights”. If a smoker no longer has any rights it goes without saying that he doesn’t have any duty or responsibility towards his country either!

  2. Junican says:

    The Government has been going on and on about ‘forcing’ Banks to lend, but if few people (and companies) see any reason to borrow, how can Banks lend?

      • harleyrider1978 says:

        They killed lending by increasing the requirements on loans. The next case was needing to have at least 20-30% cash down payment on new or older homes to make the deal. Then add in of the 15 or so more million homes that have been foreclosed on,those folks credit rating is ruined and cannot get a loan. Then add in a credit score thats good so you can rent an apartment to live in. What we have is whats become knowm as OBAMAVILLES/HOOVERVILLES today. Basically low rent camp grounds where you can live cheap without a credit check. Anything that will go down the road on 2 wheels or more and has a roof is all you need. Thats the cold hard facts and it isnt getting any better as we are just about to hit the end run of pumping and printing this year or next.

        We all know why theyve been printing money for so long and thats to keep their precious government hierachy working and going as they havent been able to get the revenues to run without a deficit for at least 6 years now……….

        The comming effect is another Great Depression. Whether the Administration and its liberal media can shut the fuck up long enuf to admit it……..Instead their simply fiddle players on the deck of the titanic as the waves come crashing over the bow! bloopbloop bloop……………

  3. Frank, I think your point about the traditional wisdom (that smokers will simply spend more money elsewhere) not being true is correct. The hospitality arena is, I believe, a pretty important sector of the economy, and a lot of the money spent there has traditionally been spent by “the 99%” — the smokers and drinkers who regularly go out for a beer and some fun rather than turn in early so as to be sharp for the next morning’s board meeting.

    Once you reduce the “fun” of going out to the pub to any degree (such as having yourself or your friends interrupting their intercourse to go stand outside several times an evening) there’s clearly going to be a tendency to go out less often or stay out and consume for shorter periods. Fine — you then accumulate some money and *maybe* spend it on something else. On the other hand, you may simply take a few extra days off of work, or spend a bit longer unemployed if you lose a job because you’re not hurting for money as much. Or drink your beer or soda at home rather than at the pub or mall, and thereby employ fewer service people per dollar you spend. Add a whole bunch of those things together and you get the “multiplier effect.” The study Dave Kuneman and I did at yielded a result that amazed even us: over the course of fifteen years or so it looked like California’s restaurant and bar smoking bans cost the state on the order of a hundred billion dollars!

    If our figuring on that was indeed accurate, and we expand it over time and geography, it could easily be true that in general smoking bans have cost the world economy on the order of a full TRILLION dollars at this point.

    Are people healthier because of that? Maybe. Hard to say what toll the social/psychological damage has inflicted on health. But there’s a feedback loop to think about there as well. If the New England Journal of Medicine’s figures I used at are accurate, we could be looking at another trillion or so due to increased long-term health costs due to lower smoking rates and having to support and pay for the medically expensive and relatively “non-productive” gerontological years.

    Is it a good thing if people live longer like that? Sure. (Although some would argue they don’t WANT to toddle around at 90 years old, most of them wouldn’t want to particularly pull their plug on any given day even if they WERE 90!) But we can’t ignore the fact that there’s an economic cost for all of us when that happens. A country supporting a huge load of wheelchair scooting nonogenarians is going to have a hard time keeping up with a country whose population is primarily in the productive 20 to 60 year old range… that would seem to be simple economic reality.

    Hitler might say “Bump ’em all off when they hit 60.” Thankfully we’re not doing that. But we can’t simply ignore the fact that our extended lives add to a social economic cost.

    Heh, sorry about going on so long here, but yeah, simply assuming that bans will have no economic effect because “smokers will just spend money elsewhere” is silly and untrue. And the overall effect COULD be large enough to have had at least a small but real impact on the larger national and world economies. I don’t believe economic theory is really precise enough to tell us *how* small (or large) though. I’ll be the first to admit that the hundred billion figure that Dave and I came up with years ago could be WAYYYY off the mark.

    – MJM

    • Frank Davis says:

      Add a whole bunch of those things together and you get the “multiplier effect.”

      My understanding of the ‘multiplier effect’ is that when I stop buying drinks at my local pub, then the breweries that supply the pub get a correspondingly smaller order for new barrels of beer, and so do the hauliers that haul beer from breweries to pubs. And because the breweries are buying less hops to make beer, farmers grow less hops, or sell them at a lower price. So there are knock-on effects which go in all directions. And multipliers can be 2 or 3 or more times the original fall (or rise) in sales.

      I’ve been trying to find out what would be an appropriate multiplier for consumer spending. It seems to me that it’s likely to be fairly large.

      over the course of fifteen years or so it looked like California’s restaurant and bar smoking bans cost the state on the order of a hundred billion dollars!

      Well, the State of California is more or less bankrupt, so I’m not surprised.

      Are people healthier because of that? Maybe. Hard to say what toll the social/psychological damage has inflicted on health.

      I don’t think people can possibly be healthier. Even if smoking bans actually do save one or two lives a year per country, what about the increased toll in colds and flu from being made to stand outside in all weathers, and the increased associated death toll from these. Plus the breakdown of communities in which people all kept an eye out for each other.

      • harleyrider1978 says:

        For want of an indoor smoking area california might have saved itself……..

        • smokervoter says:

          Truer words were never spoken Harley. When California bars went smokefree, millions, and I do mean millions of partiers flooded Tijuana, Mexico every weekend. I’ve still got the mental picture in my mind of looking down the main boulevard there at a “swirling mass of grays and Black and white” (thanks Keith). The loss of revenue for San Diego bar owners in particular had to be immense. I remember reading an article in the Los Angeles Times that pointed out that more people went to Tijuana than Disneyland on the weekends.

          Do the math; x-amount of people spending x-amount of money times 52 weeks times year after year and the amount is staggering.

          Then there was me at the cantina telling everyone within earshot that they could legally bring back 10 cartons of Mexican cigarettes with them. The common misnomer at the time was that you could only bring back one carton (a sleeve to my British friends here). I singlehandedly must have cost the California state treasury and Rob “Meathead” Reiner millions of dollars.

          Just for laughs, we’d sometimes stop in at one of the cutesy-fartsy San Diego nightclubs, with their goody-two-shoe organo-hipsters all luxuriating in the cherished smokefree environment, back in California. They’d be in there celebrating in stony silence with their maximum 15 fellow fun-lovers listening to bad avant-garde piano jazz. You could hear a pin drop.

  4. Actually, I was being a little sloppy in my language there. The real “multiplier effect” applies mainly to the sort of idea where when I don’t go out to the pub, the waitress makes fewer tips, decides that she can’t afford a car, thereby helping in the layoff of auto workers and gas station attendants, who then don’t have the money to … etc. It’s the whole, “For want of a nail, a kingdom was lost” thing… the butterfly effect. But smokers are a heckuva lot of butterflies.

  5. Klaus K. says:

    The first smoking bans in Europe came in Ireland & Norway in 2004 – two small countries, each with 4-5 mill people.

    There was a huge rise in economy all over Europe from Q2 2003 until Q3 2007. In Denmark we had a consumer driven upswing, that was made possible because Danes were allowed in 2002 to take more favourable loans in their real estate – same principle as in the US.

    The Danish smoking ban came in Aug. 2007, but the only obvious effect on the economy was like yours: The pub & restaurant industry and the breweries both dropped within 12 months after the ban. It was hard times for Carlsberg because of the British ban, it was said. Elsewhere everything seemed quite normal: No obvious negative reaction in the broader economy. Everything looked good on the horizon – especially the hotel-business, which were expecting a prolonged upswing.

    The first mention of potential economic trouble in Danish media was not until June 2008, when it was said that government should have dampened the economy in previos years because now we risked a recession. It was not really alarming. The Lemann Brothers crash was mid Sep 2008 and then followed the financial crash, until big bailouts stabilized things about March 2009. It was not until New Year 2009 however that Danish companies started to fire employees.

    What I am saying is, that noboby expected anything bad to happen until June 2008. I think you are asking a very good question: Why haven’t anyone questioned the role of the smoking bans in the so-called financial crisis? The answers of course could be the standard economy-knowledge: That people spend their money on something else, as you point out. And then again: It is very possible that the smoking bans are the single dominant reason for the crash – although other reasons clearly also exist.

    I found this graph from Denmark. It shows Danish retail sales 2005-2010. See what you can make of it:

    Blue line: Food and other daily goods
    Red line: Clothes
    Green line: Other consumer goods

    Please note that the official explanation in Denmark is that the financial crisis hit us with the Lemann Brothers crash 15. Sep 2008. As you can see, at that time the retail sales were already down to the bottom of the graph: The Lemann crash could not have caused that. The figures BTW did not return to earlier levels as of 2012.

    • Frank Davis says:

      Your graph, annotated as described.

      Danish consumer trends

      Here’s a graph of UK household consumption trends. The UK smoking ban came into force in the third quarter of 2007.

      UK household consumption trends

    • beobrigitte says:

      Both graphs, if viewed from a smoker’s perspective, are RIGHT.

      NOTHING other than ashtrays in cafes will get me into town for shopping. The longer it takes to entice me to go shopping, the more I get used to accumulate cash in my bank and else where, securing my pension. (I read recently that tobacco industries are worthwhile investing in)

      Isn’t it a pity we smokers are “sub-standard” beings?

  6. Nightlight says:

    You just need to look similar size economies, such as China, where smoking is riding high — despite the communism, their economy is growing, overtaking USA. During the peak of British Empire, smoking was so popular, it was compulsory in the elite boy schools. When USA was at its peak relative to the rest of the world, in 1950s and 1960s, the smoking was also at its peak. Western Europe rose rapidly from 16th century on, paralleling the rise of smoking there.

    This effect works at the level of social organisms the same way it works with individual human smokers. Social organism is an ‘intelligent network’, the same kind of distributed self-programming computer as our organism is (which is built up from cellular biochemical networks, to organ networks such as brain, to whole body network). This parallelism goes well beyond analogy, since these intelligent networks use the same kind of programming patterns and algorihtms — for details & references see the post “Biochemical networks and their algorithms”!msg/ .

    One can thus say that social organism smokes through its cells (individual smokers, tobacco industry and the rest of the economic web supporting these), just as your organism smokes via its cells (not just lung cells which absorb the medicinal substances from tobacco smoke, but the whole “delivery web”, from your fingers holding the cigarette to you lung cells). Note that, from the perspective of your cells, “you” are an abstract entity (like god to us), and entire smoking is done by them.

    With strong parallelism between these networks at different levels, one can transport knowledge and insights from one realm to another (mapping in details between social phenomena and the biochemicla effects of tobacco smoke; indivudial smokers are “lung cells” of social organism absorbing tobacco smoke). For example, the national elation and productivity boost in nations where smoking is on the rising curve is the same process that you can observe on yourself, after you get up in the morning and have coffee with first few cigarettes. Similarly, the economic downturn in a nation overtaken with antismoking, is analogous to your own feel in a period of tobacco deprivation. Of course, when you finally get to a first cigarette at the end of that period, it feels like the best one of the day.

    Hence, the western nations, intoxicated temporarily by the pharma drugs (ingested chiefly through the media, politicians and bureaucracies, soaking in the pharma bucks), will continue to decline until a severe crash, followed by massive, possibly violent backlash, which will swipe away the present corrupt leaderships and elevate liberty minded men to the top. At that point, all prohibitions (including the so called ‘drug war’ on non-pharma drugs, smoking restrictions and hypertaxation) will be reversed as well, while all the scum from the previous era will be denormalized, in prisons hopefully, and these nations will be on the rise again in all respects.

    • Frank Davis says:

      Similarly, the economic downturn in a nation overtaken with antismoking, is analogous to your own feel in a period of tobacco deprivation

      These days I’m seriously wondering whether much of the junk science around (and there’s one heck of a lot of it) is because the researchers don’t smoke, and don’t make connections, but come at everything with dogmatic preconceptions. Antismoking ‘science’ seems to work this way. They ‘know’ that smoking is bad for people, and set out to prove what they already ‘know’. The same dogmatism is found in climate science. And it isn’t science. Science needs an open-minded willingness to see things in new ways, and draw different conclusions.

      Perhaps the same dogmatism pervades economics. The economists ‘know’ that smoking bans are a ‘great success’ and so they don’t (can’t) consider the possibility that they have highly negative impacts on the economy (as well as elsewhere).

      Same with the antismoking EU, with its dogmatic insistence on a single European state and a single currency.

      It’s as if there are a lot of stupid people navigating the ship of state. And none of them really understand anything. And will listen to nobody. In such circumstances, disaster is inevitable.

      • nisakiman says:

        Yes, you’re absolutely right there Frank. Any research, be it political, economic or medical that is done these days is done within the confines of the received orthodoxy, and anything which appears to contradict the belief system is willfully ignored.

        And smoking is the elephant in all their rooms at the moment. What we need to do is keep feeding it (the elephant) so it gets bigger and bigger and bigger until finally they will be unable to pretend it’s not there anymore.

        It’s going to take a while, I think…

  7. SadButMadLad says:

    Correlation and causation.

    Whilst smoking bans and alcohol bans (and potentially fat bans and sugar bans) can cause a downwards turn in economies the scale of the current one is more down to the financial crisis caused by banks lending stupidly for overpriced properties and also crap management within the banks driven more by political ideology than common sense.

  8. You may find this of interest, Frank:

    OCU (a consumers and users organization in Spain) is strongly biased against tobacco, so their data showing a strong approval for the smoking ban in Spain is no surprise. What does come as a surprise is that their data also shows a remarkable decrease in the frequency and time people who smoke spend in bars, restaurants, etc:

    Much less:
    41.4% of those who smoke 5 cigarettes or less per day.
    65.2% of those who smoke 5-15 per day.
    82.1% of those who smoke over 15 per day.

    Time spent.
    Much less:
    40.6% of those who smoke 5 cigarettes or less per day.
    77.3% of those who smoke 5-15 per day.
    87.9% of those who smoke over 15 per day.

    They polled online for a week back in 2011 among people of their own polling department. They got 1.562 answers.

  9. Rose says:

    Has anyone spent more or much more on anything since smoking bans overtook them?”

    When people feel under siege they begin to act like it.

    For example, where I would have bought a product, now I learn how to make it from the raw materials, and better if possible, every saving feels like a minor triumph. The breadmaker I was given for Christmas last year must have paid for itself several times over, not only bread, but chapatis, pizzas, hot cross buns, and stollens, each at a fraction of the price I would have paid without thinking about it.
    I would never have believed that I would ever get to the stage of calculating the cost of buying my favourite sweet pepper against growing my own and delight in the fact that I had saved £30 pounds.I now compare the cost of my seed potatoes that I once grew only as a hobby,against what I would have had to pay for new potatoes in the shops
    And you know what? I give these things away! I don’t care about the money, it just pleases me that the money I save is no longer going into the coffers of those who so clearly despise me.

    I have spent much more on vegetable seed, seed potatoes, fruit trees, soft fruit bushes and compost for the garden, which before the ban used to be mostly flower borders, but I think of that more as an investment.

    • beobrigitte says:

      Rose, you can save the money you spend on seeds by going for a walk, collecting them!
      My potatoes I have already separated; the ones I grow are on the top shelf, the ones I eat are in a cool, dark place. I have carried over the chilli and pepper plants from last year (doing well inside!).
      I will start tobacco this year .

      And, yes, I haven’t been to town shopping for ages. Why should I? This government treats me like a leper, the least I can do is TO STAY AWAY from shopping precincts.

      • Rose says:

        Brigitte, I’m now saving the seeds from the plants I grow, growing extra plants and distributing them to family,friends and neighbours, so everybody saves money.
        Not that I have anything against garden centres and seedsmen, they haven’t made me feel unwelcome even once.

        I only grow the early new potatoes that cost a fortune in the shops, the grey slugs round here are too ferocious for a main crop.
        My favourites are International Kidney (Jersey Royals ) and Charlotte.

        I think you’ll find tobacco great fun to grow, but it’s a hungry plant and can deplete the soil, so I’d be generous with the manure.
        As an experiment, I grew tobacco in the same spot for several years and with liberal spreading of well rotted manure, before planting out and after the Autumn digging, the ground was fine.

  10. prog says:

    As a couple, I estimate that we have probably saved c. £15000 since July 2007. But everything else seems to have increased in price to swallow that saving. Not sure of the precise figure but I think over half of gross earnings ultimately goes towards taxes, licenses etc. Take motoring for example. Assuming the car is paid for the vast majority of running costs are due to licensing and fuel duty (which have soared since 2007). And I guess much of what people receive in benefits finds its way back in the form of duties and VAT. Maybe one reason why they ‘print’ so much money – its a sort of investment by the government. Fool’s gold though.

  11. Matt says:

    It’s quite possible that, for many, money no longer spent on social activities is being used to pay off mortgages more quickly. This, despite being a sensible and beneficial thing to do, is presumably seen as “bad for the economy” because it results in the banks receiving less interest in the long term. It’s certainly what I would have been doing if my income had remained the same. Instead I chose to quit my employment on the basis that there was no point earning (and being taxed on) much more than I needed to live off.

    That being said, an alternative view is that for many the “savings” have effectively gone into a black hole. Government policy has been busily inflating the costs of essentials such as food, fuel and housing whilst wages and salaries have remained pretty static for several years, meaning that money no longer spent on socialising may now be simply covering the bills.

  12. Jonathan Bagley says:

    I spend more on holidays abroad since I stopped going into pubs, restaurants and cafes. If this is widespread, it will make a difference, perhaps around 1% to 2% of net income for those who adopt similar behaviour..

  13. Jonathan Bagley says:

    A minimum alcohol price will similarly make a difference to spending in the UK when home brewing, wine making and illegal distilling gain popularity. Holidays and short breaks are what spare money tends to go on. We currently have a very low proportion of non excise alcohol consumption compared to Sweden, for example. Many people now in their fifties and sixties made their own beer and wine back in the seventies and eighties. Last week’s Guardian featured an article about home brewing – I can’t remember the last time I saw one.

  14. Jonathan Bagley says:

    Add in ecigs. My weekly vat now £1 a week. Weekly vat and taxes for a legal 20 a day smoker, around £35 a week.

  15. Steve Kelly says:

    In the USA, in fact beginning in the colonial era, tobacco was amongst the most important economic drivers. It remained a vast industry into modern times. Of course that’s been cut down. I simply lost my taste for restaurants & bars when the bans came in. I don’t go. I might get take-out food a bit more often than before but not much. I buy economically at the grocery store. I drink less, & when I do, never ever at bars, not once, not one drink in years. Society has deemed us rodents. Society suffers for it. Good enough for society. Society still wants our rodent blood and rodent lung donations though. (Have you seen the recent articles where the lung organizations are now begging for smokers’ lungs, even from long term & heavy smokers, having shown that our rodent lungs work perfectly and last forever when transplanted into real human beings? An example: I used to donate blood. Not anymore. I’ll take my rodent lungs to my rodent grave, too, thank you very much. Or are they going to ban smokers from the graveyards now, so we don’t contaminate the soil, and the healthy non-smoker corpses? Then the economy will lose our burial fees too. Anyway, the economy has lost any contribution from me that I don’t have to make, already. I make my own cigarettes, as well, so Big Tobacco and the taxman have lost on me that way.

    • beobrigitte says:

      I used to donate blood. Not anymore.

      For me it was a hard decision to make; I am a ‘universal donor’ with the additional benefit of having a high hemoglobin.
      Nevertheless, I did look at the “denormalisation programme”. According to this I MURDER people.

      I stopped donating blood.

  16. Michael F says:

    The biggest impact would have to be tourism. In Australia with probably the harshest TC laws in the world. Pipe tobacco is about AUD27 an ounce. Tourism is in decline. Part of it is hotels, food and transport. People accept that. I think the tobacco price and restrictions are the strongest factor though. Young people holiday in Asia rather than stay at home in Australia because in Asia you get cheap rooms, 50c beers, easy women and $1 pack of smokes. When I have been to Asia I have found a majority of the tourists to be smokers. Why would tourist come to Australia when a pack of smokes cost as much as 1/3 of a cheap hotel rooms and you are restricted where you can smoke. For example a tourist can not enjoy a smoke at a pub or club with their booze which means they go home earlier. If you can’t party how you like to then there is no point going out to party.

    Quick question. I fail to understand the argument for passive smoking. According to TC passive smoking is worse than being a smoker, smoking kills smokers and passive smoking kills everyone else. Would we not be at a stage where everyone is now dead? Since everyone for the past 100 years or so has been exposed to smoking.

    • prog says:

      No, but people (including smokers) are living longer which places a huge burden on NHS resources (even after asset stripping). Also, there was greater family cohesion until the last few decades of the 20th century, so older ailing parents were looked after by their own kin. The irony is, of course, that fewer suffer (and possibly die) from infectious disease though far more now succumb to the very things that TPTB are claiming are self inflicted, but are basically due to the fact that people are living longer. Longevity does not mean a ‘healthy’ demise. Furthermore, in terms of actual numbers, most of these ailments are contracted by non smokers and moderate drinkers who contribute far less (on average) to the Treasury than smokers.

    • beobrigitte says:

      I can add another question: How many people NOWADAYS receive a letter from the Queeen to congratulate them to their 100th birthday?
      it would seem quite a lot. Clearly these old dears did not understand the instant death of active/passive smoking.

  17. Nightlight says:

    I fail to understand the argument for passive smoking. According to TC passive smoking is worse than being a smoker, smoking kills smokers and passive smoking kills everyone else. Would we not be at a stage where everyone is now dead?

    Yep it appears that SHS has evolved into a major menace. Since smokers are exposed to SHS and also to primary smoke, yet if they quit by 40 they go unpunished, it would appear that primary smoke is protective against the ravages of the SHS. Obviously they are having difficulties keeping all their stories coherent, the lies are catching up.

    In fact the above apparent paradox (from conventional wisdom) has been noted by scientists for people living or working in very harsh environment, e.g. miners, workers in heavy or chemical industry, etc. Its scientific name in literature is “Strong smoker effect” [1] — in such conditions, where all individuals are exposed to the same levels of toxins, smokers are doing better than non-smokers, while ex-smokers are the worst off. The only acceptable explanation they could come up with was that those who still smoke under such heavy conditions must be naturally healthier, hence they end up better off than non-smokers.

    The more “modern” SHS theory would “explain” the same observation by declaring that SHS from those smokers is harming non-smokers and ex-smokers (yet somehow sparing smokers).

    In fact both stories are pure rationalizations in the face of unacceptable fact — tobacco smoking is highly protective in such harsh conditions due to its potent anti-inflammatory effects and to its effect of near doubling of the key internal detox and antioxidant enzymes (glutathione, catalase and SOD). Hence, smokers are self-medicating in such situation (doubling their detox rates, suppresing chronic inflammation and cytokine storm.

    A good example is a study of German aluminum potroom workers [2], which illustrates all of the above points. Aluminum is potent pro-inflammatory toxin and the potroom workers inhale its vapors and dusts, leading to emphysema type damages. In this case, such emphysema type damages were found only in non-smokers, while the respiratory symptoms, such as cough, wheezing… were 6.7 times lower in smokers than in never-smokers, and 11 times lower than in ex-smokers. This study was discussed in more detail in thread [3](search for “aluminum” for several posts) Dr. Siegel’s blog (tobacco control doc).

    Hence, from within the antismoking matrix, it would appear that SHS is worse than primary smoke, which is what they traying rationalize in some way.

    Of course, they won’t mention that the same effects is well known in animal experiments with coexposures to industrial toxins and carcinogens — the smoking animals tolerate such envirnments better than non-smoking animals. E.g. by the time all non-smoking animals have succumbed to the toxins, there are still half of the smoking animals alive [4]. In an experiment on dogs exposed to radon, non-smoking dogs develop 7 times more lung cuncers than smoking dogs [5]. Since this is hard science, with fully randomized samples, none of the antismoking theories works here, that’s why they never bring up hard science but only junk science and lots of handwaving, like the above SHS paradox.

    [1] — Healthy smoker effect —


    [2] — Study of aluminum workers —
    Occup Environ Med 1999;56:468-472

    [3] –Post in Dr. Siegel’s blog —

    [4] — Large hamster experiments —

    [5] — Dogs exposed to radon & smoke expoeriment —

  18. anono1955 says:

    dated Jan 27, 2013

    Click to access Smoking_Ban_Brief.pdf

    The Kansas Business Right To Choose organization has studied the “report” of the Kansas Health Institute which was presented to the media and find the “report” to not only be incomplete but incorrect. (Other terms to describe this are not printable.)

    The Kansas Health Institute which purports to be unbiased, neglected to mention ANY data, which there is a mountain of, that shows the damage to our smaller businesses due to the smoking ban.

    The Kansas Health Institute did not figure in the increase in the costs of product that our businesses sell over the period of time of the “report”. The increases have been astronomical, and should reflect a huge increase in the 8% and the 10% taxes that our businesses pay and collect, to and for the State. For instance. The cost of a keg was $49 in ’99, $67 in ’05, and is now $98. When we buy the keg we pay 8% to the state. When we sell drafts and pitchers, which also went way up to cover the increases in cost, we pay 10% to the State on every sale. Pitcher and draft prices to our customers have risen dramatically and so has our 10% tax output.

    The report ignores the studies by economists which have found that smoking bans hurt bars and casinos. ( I have plenty of those if you want them.)

    The Kansas Health Institute did not mention the many huge chain restaurants that have opened and who carry the same license as the little bar on the corner! This is great for tax revenue as they really stick it to customers on their drink prices, but, and this is a big but, their profits do not stay in Kansas. Our little businesses are Kansan owned and operated!
    Our money buys homes and pays property taxes on same! Our profits, if any, stay in Kansas.

    The Kansas Health Institute did not mention what I consider to be a major conflict of interest, which is their funding from the biggest grantee who promotes smoking bans in the world. That is Robert Wood Johnson Foundation, who operate their grant funding on their holdings in Johnson and Johnson stock. J&J sell the gums and patches, which the State is STILL buying and handing out for free, in spite of the recent Harvard study which shows them to be no more effective than cold turkey!

    The Kansas Health Institute purports to be the friendly and honest and unbiased advisor to the government of Kansas on health policy.

    I guess one out of three ain’t bad?

  19. harleyrider1978 says:

    Record withdrawals at U.S. banks as Americans lose trust in financial system

    Thursday, January 31, 2013 by: Ethan A. Huff, staff writer

    Learn more:

  20. Mr A says:

    I don’t spend it on anything else. Since July 2007 I’ve gone from having a grand in my bank account to having 50 grand. If anything, I spend less money altogether. I used to go out 4 or 5 times a week – now I go out maybe once a quarter. So the money I spend in pubs, bars, nightclubs, lapdancing joints, restaurants etc has gone from almost £1500 a month to virtually zero. As I don’t go out, I no longer take taxis. As I don’t go out, I only buy new clothes when my current ones wear out. In fact, the only thing I’ve spent any money on was a new sports car, and that was more out of a feeling of “I have to do SOMETHING with this saved money” than anything else. And THAT was only what I used to spend in 5 months of going out.

    My lifestyle now is very much like someone who is in prison (as in many ways that is how I feel). So where prisoners may pump iron and work out to kill the time, I now do a lot of running, mountain biking, weights etc – all things which cost virtually nothing and contribute virtually nothing to the economy (I don’t even pay gym fees as I work out at home). I’m just killing time. And still that money continues to pile up. I’m not complaining but if I had a choice between having a grand in savings and being able to enjoy going out, and having 50 grand but not seeing the point in doing something which used to be my main past-time as I can’t relax, I would go for the former every time.

  21. smokingscot says:

    Lots of fancy words spring to mind “Discretionary Spending”, “Spontaneous Decisions” and “Impulse Purchases”.

    On the basic assumption you guys have had similar experiences, you’ll know these have all been shot to bits. Now it depends on things like the weather and anything like a weekend away can be such a fuss, what with trying to find a place where smoking is still allowed. Almost everything has to be thought through and planned well in advance.

    Re what we do with our money, well we’re no different to the rest of the population in that regard and leaving cash on deposit is neither rewarding nor clever. Anyone with an interest in personal investments will know it’s been real assets or collectibles or tangibles for quite some time.

    On one hand it’s resulted in the big fellows monetizing food, with corn and coffee both terribly rewarding if you can be bothered to jump in and out the market several times a day. Metals and oil are also big at the moment – and quantitative easing (another fancy word) has allowed those with access to cash at 1% pa to play those markets.

    I track classic motorcycles and they’ve proven to be first class investments, with some trebling in value since 2007. I believe it’s the same with watches, Toby jugs, classic cars and even Legs has been shocked at the prices he’s getting for model railways.

    (My personal favorite, and ideal as a living room ornament, has to be this jewel)

    Do it sensibly, with intent, and your gains are tax free.

    Unfortunately these have almost run their course with the possible exception of watches.

    Currencies are good at the moment, however it’s always best to use an on-line broker to trade forex. Find a reputable broker that leaves it up to you to do the tax side of things (yea, sure). Ditto equities, if you want to take a medium term view.

    But the best deal at the moment is the annual budget. We all know the retail on tobacco will go up by at least 7% and probably 10%. It’s 100% rock solid. Got to be wired in to work that one well – and that’s one reason why retirement villas in certain parts of the world (mainly, but not exclusively, the Indian sub continent) are full of exotic marble and intricate wood carvings… and a Lexus in the garage.

    • nisakiman says:

      (My personal favorite, and ideal as a living room ornament, has to be this jewel)

      Heh! Nice one! In my youth, I was quite into bikes (I had a Norton Dominator 88, 500 twin and an Aerial KH [?], also 500 twin if I remember right, among others. Loved the Dommie, super ride but it used to piss oil all over the place. Must have replaced the gaskets a dozen times, but it still leaked). Anyway, a guy I knew used to work in a local metal plating plant. So he bought himself a brand new Triumph Bonneville and immediately proceeded to strip it right down. Everything ferric (frame, suspension, nuts and bolts etc), he chrome plated, except the fuel tank, oil tank and battery box, which he painted two-tone light and dark blue. Even the cable covers were flat-wound chrome. The cylinder block and head and all other alloys he polished to a mirror sheen, Then he put it all back together again and mounted it in the front window of his council house, where it remained for the following six months until I left. It really was stunning. I’ve no idea how long it stayed there or if he ever rode it!

      Sorry, bit of a memory-triggered ramble there. Must be the red wine… :)

  22. Tony says:

    I thought restaurants would lose revenue due to the smoking ban and at least in my locale they appear to have done so. On the other hand I expected take-away revenue to increase. However my local Indian saw an immediate drop following the ban which initially surprised me.

    But then, we used to pick up a take-away on our way back from the pub. And as we no longer go to the pub, getting a take-away requires a special round trip which is a significant disincentive, as is the alternative of paying a delivery charge. So we eat them much less often..

  23. harleyrider1978 says:

    Add Canada to the growing list of announced bankrupt countries this week!

    Ontario on brink of fiscal fiasco: Fraser report

    7:54 am, January 31st, 2013

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    Ontario on brink of fiscal fiasco: Fraser report
    Ontario’s new premier, Kathleen Wynne, holds her first press conference at the Delta Chelsea Hotel in downtown Toronto



    TORONTO — Ontario and its ballooning debt are on a collision course with fiscal reality, a new Fraser Institute report suggests.

    The province’s net debt could swell to 66% of GDP by 2019-20 if the government doesn’t slow the rate of health and education spending adopted over the past decade, the report’s authors conclude.

    The State of Ontario’s Indebtedness — Warning Signs to Act, says the province is in far worse shape debt-wise than cash-strapped California, and could use the lessons learned from Greece to avoid a similar fiscal fate.

    The report states that Ontario’s total debt as of 2010-11 was $236.6 billion, compared to California’s $143.9 billion.

    “Ontario’s bonded debt is almost two-thirds larger than California’s even though California is a much larger jurisdiction in terms of both the size of its economy and its population,” the report states. “Simply put, across every comparable measure available, Ontario’s indebtedness is markedly worse than California’s.

    “For those Ontarians who look at California in puzzlement over its inability to solve its deficit and debt challenges, this … strongly encourages them to look inward at the severity of their own indebtedness.”

    California differs from Ontario because it has strict limits on how much debt it can accumulate.
    Ontario’s economy has grown by 133% since 1990-91, while the debt shot up 571% over that same period.

    The 2008-09 recession and one-time infrastructure and energy expenses — such as the assumption of stranded Ontario debt — were culprits, as was the fact that the interest rate demanded by buyers of Ontario debt exceeded the rate of growth in the economy every year since 1990-91.

    The authors concluded that Ontario’s debt problem is not of the magnitude that prompted drastic belt-tightening in Greece, but argued the status quo and inaction are no longer options.

    The two jurisdictions share a history of spending far outpacing revenue growth, leading to sizable structural deficits.

    The State of Ontario’s Indebtedness notes that the current Ontario government has recently signalled its intentions to slow the growth in spending.

    But one of the roadmaps to savings, economist Don Drummond’s Commission on the Reform of Ontario’s Public Services, has been largely ignored by the government, the report states.

    “The conclusions of the Drummond Report should have been a wake-up call for the Ontario Government regarding the immediate need for reform of the province’s spending,” it says. “Instead, the government has chosen to try to simply slow the rate of growth in spending over the next few years without any serious reform.”

    Incoming premier Kathleen Wynne has already said that she will revisit the Drummond report.

    “Limiting the rate of growth in health and education spending is the key,” the report says. “A broader program of spending restraint hastens the day when the debt burden stops increasing and can begin to fall … a broad program of spending restraint can stop the growth in the debt burden almost in its tracks.”

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  24. harleyrider1978 says:

    Did I say a great depression was comming for like the last 3 years or so!!!

  25. jaxthefirst says:

    I’d like to know what the anti-smokers think I’m going to spend my extra money on. From whence does the reasoning come that because I’m not going to the pub any more I’m immediately going to rush out and buy myself a dozen new pairs of shoes?? I’ve already got plenty of perfectly good shoes – why would I want any more? By what leap of logic do they think that not being able to enjoy socialising any more is going to make me want to spend hours in the shops spending all the money I’m no longer splashing out on socialising? A day’s shopping these days becomes torture the moment the first coffee-break or lunch-stop rolls around, so why bother going? How have they come to the conclusion that because I’m not doing as much “stuff” as I used to then my need to purchase material goods is going to increase in direct correlation to the reduction in the time I spend doing all the things that I used to do?? As many on here have commented, doing less invariably means needing less – fewer smart clothes, fewer cards and presents for celebratory occasions, fewer taxi trips, fewer holiday clothes, fewer cosmetics and make-up …… the list goes on.

    I guess this leap of logic is just another indication of the mindset of the average anti-smoking zealot. As has been mentioned on here before, non-smokers, by and large, just don’t “get” smoking and so can’t really grasp the sledgehammer effect which the ban has had on so many smokers. And anti-smokers “get” smoking least of all. Hence their propensity for glib, simplistic comments like this. I’d like to hear their explanation as to why, instead of “simply spending my money elsewhere,” as they so optimistically say, since the ban – without even trying – I seem to have amassed a more substantial chunk of money in my current account than I managed to amass over the previous 30 years of diligent payment into a savings account, and which continues to languish there, consistently untouched for best part of five years, for the simple reason that there is nothing now that I feel even remotely inclined to spend it on.

  26. Pingback: Averting Their Eyes | Frank Davis

  27. Mr A says:

    The “coincidence” of economic downturns and the credit crunch is an unfortunate one – as we know from looking at the antis’ junk science – correlation does not equal causation so our observations can be easily discounted.

    However, I’d be interested in seeing if any nations/states instituted bans a long time before the crunch (say, 2004) and experienced economic damage, despite an otherwise booming economy. That would be decent proof of Frank’s thesis. As would any evidence from nations/states that reversed their ban and similarly reversed their economic downturn, despite the prevailing economic / fiscal conditions.

  28. Pingback: Various Impacts of Smoking Bans | Frank Davis

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