The One Thing That Philip J. Cook and Wayland Ellis Both Agree On

Sometimes an idea comes along that is so compelling that even polar opposites of a particular ideological or public policy spectrum are willing to at least grudgingly embrace.  And sometimes that idea is not only not a new one, but has existed since practically forever yet has been largely underutilized all the same despite all the evidence in its favor.

Take the following two authors and researchers:  Philip J. Cook (author of Paying the Tab:  The Costs And Benefits of Alcohol Control) and Wayland Ellis (author of Abolish the Drinking Age:  The Conservative Case Against Alcohol Regulation).  The two can be considered to be each other's foil in many ways in regards to alcohol.  Cook is American, pro-21, pro-regulation, leans a bit more liberal than conservative, and leans more communitarian than libertarian.  In contrast, Ellis is British, anti-21, anti-regulation, conservative by British standards, and leans quite libertarian even by American standards.   

And yet, there is one thing that they both agree on:  the single most effective public policy measure to reduce alcohol-related harms is higher alcohol prices, such as through higher alcohol taxes.  Cook arrives at that conclusion enthusiastically while Ellis arrives at it perhaps a bit grudgingly, but the conclusion is the same regardless despite their otherwise polar opposite views on the drinking age and alcohol regulation in general.  Now that really says something!

And it pans out, given the reams upon reams of research evidence that arrive at that same conclusion in a wide variety of times, places, demographics, and functional forms.  Twenty-One Debunked generally agrees more with Cook than Ellis on most of the topics under discussion with the notable exception of the drinking age of course.  Especially since Cook's own 1984 study with Tauchen was one of the now-outdated studies that convinced the feds to force states to raise the drinking age to 21 in the first place.  We agree with Cook on some things, Ellis on others, and clearly agree with both on the issue of alcohol taxes.  Alcohol prices relative to inflation and income are currently at a record low in the USA, in no small part because taxes are at at a record low as well.  And there really is no overarching benefit to society for alcohol to be that cheap, while there is plenty of proven and serious harm from the excessive drinking (among all ages) that such cheap alcohol encourages.

Twenty-One Debunked supports lowering the drinking age to 18, while also raising and equalizing the federal alcohol taxes across the board to $24/proof-gallon, equal to the inflation-adjusted 1991 level for distilled spirits.  That would be a little more than an extra dollar for a six-pack of beer or an extra dollar on a fifth of liquor.  That could be done more gradually by first raising it to $16/proof-gallon and then to $24 a year later. Additionally, we would also be fine with (though not necessarily wedded to) the idea of setting a minimum price of $0.50-0.75 per standard drink or at least banning the practice of retailers selling alcohol below cost (already banned in many states).   Cook would support the latter idea of a price floor while Ellis would most likely not, but both would at least support higher alcohol taxes.

So what are we waiting for?

Would A Price Floor for Alcohol Be A Good Idea?

With the issue of alcohol taxes now coming to the forefront lately, there is also another policy measure designed to reduce the problems and externalities associated with excessive consumption of alcohol:  minimum unit pricing.  That is, a setting a minimum price per standard unit* of alcohol, which like excise taxes would increase the price of the cheap stuff (that is favored by heavy drinkers) but unlike taxes would have no effect on beverages whose price is already higher than the new minimum.  After all, the effect of taxes operates through the mechanism of higher prices, so the public health benefits should be similar for both taxes and a price floor, or some combination of the two.  The biggest differences would be in efficiency (who bears the costs) versus revenue (who gets it)--though even for taxes alone, the largest effect size, at the margins, would be on the heaviest drinkers as well, for obvious reasons.

One can see the effects of a price floor on both cheap alcohol in general as well as in bulk quantities.  Take a 40 oz. bottle of 8% ABV malt liquor that now costs $2.99.  That contains a whopping 5.3 standard American drinks*.  If the price floor was then set at $0.75 per standard drink, for example, the price would go up to $3.99, a small but significant jump that really would add up for a heavy (and/or very young) drinker.  A six-pack of 12 oz. cans of say, Budweiser (5% ABV) that sells for $5.99 per six-pack, already above that hypothetical price floor at $1.00 per standard drink--and that is a low-ball price for a six-pack in the USA--would be unaffected.  A 12-pack of the same product selling for $9.99 would still be unaffected, and an 18-pack could be sold for as little as $13.50.  But that 30-pack now on sale for $14.99?  Well, the price for that would go up to $22.50.  And that 15.5 gallon keg that currently sells for $100 or less, excluding deposit?  Well, that contains about 168 standard drinks, so the minimum price for that would jump to $126 per keg.  And those prices for bulk quantities would really add up for anyone who frequently throws or attends keggers or other large drinking parties--leading to somewhat fewer such occasions and/or less beer to go around at such parties.  And now combine that with even a modest tax hike and you get a marginal effect size that is greater than either measure alone.

What about the hard stuff?  Well, we see that while most of it would remain unafffected by a price floor, the cheaper end of the scale would be nonetheless be affected as well in a similar manner to beer.  Take a "handle" (i.e. a 1.75 L bottle) of the cheapest vodka, whiskey, or whatever that currently costs $12.99 in some places.  That contains about 40 shots of 1.5 oz each, so at 80 proof that would equal roughly 40 standard drinks per bottle.  If the minimum price were set at $0.75 per standard drink, that bottle would now cost about $30.  Even a mere $0.50 per drink floor price would raise the price of the cheap booze to around $20 or so.  So while distilled spirits would be the least affected category overall, they would in fact be even more affected than beer at the lower end.   And this would also lesssen the yawning disparity between on- and off-premise prices, thus reducing the urge to "pre-load" or "front-load" with cheap booze before going out to the bar, pub, or club.

So yes, Twenty-One Debunked would be fine with a price floor of $0.75 per standard drink, just as we would be fine with raising alcohol taxes across the board to as high as $24/proof-gallon for all beverage types.   A combination of both would also be good as well.  Given how moderate and responsible drinkers would barely be affected at all by either measure as noted (as long as the thresholds are not set much higher than the ones above), they hardly qualify as blunt instruments and are in fact highly efficient in practice.  That's a small price to pay for liberty.

* One "standard American drink" or "standard unit" of alcohol is equal to one measure of the following:  one 12 ounce can/mug/glass of beer at 5% ABV, one 5 ounce glass of wine at 12% ABV, or one 1.5 ounce shot of distilled spirits at 80 proof (40% ABV).  This is known as alcohol equivalence.  Contrary to popular opinion, these all contain the same amount of alcohol.  So keep this in mind if or when you drink.