The right amount of smoking

I’ve recently been watching two social trends, one with fear and one with relief.

Both are about the legality of “vices.”

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The first is gambling. I see betting ads everywhere. Gambling is taking over sports. It is also taking over our cities. Poker machines are proliferating across the poorest suburbs, while Sydney’s glittering waterfront is about to get a new casino. Packers new Barangaroo den is ostensibly for high-rollers, but of course will be for everyone within a few years of opening.

Given its corrupting influence and addictive properties, I think gambling’s reach has become too great.

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Found easily on Craigslist

The second “vice” I’ve been paying attention to is drug legalisation. I think we are on the brink of having marijuana made legal across the western world. A big part of the US has done it. Canada just voted for it. The UN itself has released a report saying the war on drugs is a really terrible idea, causing problems like the Mexican cartels.

Prohibition is a proven failed policy when it comes to alcohol – perhaps it will soon be abandoned as a policy for drugs too?

I see people very skeptical of drug control writing in the mainstream press often and I think we’re on the brink of a great relaxation.

That’s great.

But how to reconcile these two conflicting views? Banning is bad but full legalisation is bad too. There could be a slippery slope here. First society legalises a vice, then you get to the point where the industry tbecomes so rich and powerful it ends up controlling society?

There needs to be a middle ground. Smoking is a good example. We can’t ban it. The minute you do, the illegal trade pops up. And for that matter, you can’t even tax it too heavily. I’m actually a bit concerned about Labor’s plan to hike tobacco taxes so sharply.

According to research commissioned by the tobacco companies black market smokes account for 15 per cent of consumption. That research is disputed. Google Trends, however, suggests people searching for “chop chop” (a term for illegal tobacco) has risen, whereas interest in the top cigarette brand has fallen.

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The reality is – there has to be an optimal level of smoking. Setting policy to reduce use to zero creates black markets, with all the problems that entails.

We have to set policy – licensing, taxation, behavioural control campaigns, advertising laws, perhaps even government monopolies – to create a certain, appropriate amount of each vice.

With smoking, we’ve controlled it at a few key points – advertising, point of sale, pricing and packaging; and campaigned against it. The policy raises tax and also incurs costs, but is effective at raising money and reducing use, while, (hopefully) keeping the illegal trade at bay.

Would society be better if we legalised and controlled every vice under the sun? It seems crazy – I can imagine an ad break telling us not to bet, then how to quit opiates, and then the risks of starting to smoke methamphetamine, even though they would all be legal and all sources of government revenue.

The costs of so much policy seem high, and the risks of not getting the optimal amount of use right seem high. But policy can be tweaked, whereas an outright ban is a tougher thing to shift.

Figuring out the optimal level of smoking – and of drinking, sports betting, pokie machines, dope smoking and heroin injection – is a delicate question. It means society knowingly sacrifices some people to addictive behaviours that harm them.

But the alternative is to sacrifice people in an act of bad faith. I would rather make things legal and trust our policy-makers to eventually get the settings right.



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Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

13 thoughts on “The right amount of smoking”

  1. I agree. The question of balance is the right question. The legalisation argument realistically will be focussed on the seemingly softer vices first so medical mrijuana and ecstacy should be where the debate is centred. After a few years of that there will be a chance to reassess. And it can be managed so that the debate is about vices where you harm only yourself. i.e. gambling and public smoking vs ecstacy and e-cigarettes.

    Liked by 1 person

    1. The great thing about marijuana legalisation is that all the US states are doing it differently so we have a good natural experiment on what models will work. That should set the legalisation process off to a good start.


      1. yes thats true although presumably we wont learn too much about long term effects. Nonetheless all the risks including the indeterminable risks must be considered, Still i think we will be better off than we are now.


  2. The Norwegian method – sale of alcohol in Norway is a government monopoly, it is expensive but available and not in the hands of business with conflicting goals. I think this would be the only model for drug legalisation.

    Liked by 1 person

    1. Yep. Ive been to state run liquor stores in Utah and in Sweden and they work fine. State control is a proven system.


      1. proven to be workable. As for its broader effects in terms of curbing use I haven’t done the research.


  3. Couldn’t agree more – great article. The Economist argues the same as well. I would advocate legalising everything from alcohol to Heroin and setup the relevant controls and health support to match. This would have another massive benefit of taking out drug cartels’ main income stream and hopefully make it cheap enough for users to get the drugs they need through chemists rather than having to break into innocent’s houses to fund their habits… countries like Mexico may then become more habitable again


  4. It’s just a matter of time before litigation funders turn their attention to the damaging influence that mass gambling support for sport has on the next generation of addicts. Kids grow up with the message that gambling is an acceptable and condoned activity as talking heads comment on odds for each team. Sporting bodies such as the AFL have lost sight of their obligations to the community. Read it here first… some smart lawyer will pick this up and run with it…


    1. Good thinking. I’m sure this infatuation with gambling will be followed by a backlash. Litigation does seem like one of few avenues that could achieve it, by using the gambling co’s deep pockets against them.


  5. I’ve been a tobacco smoker all my life. I enjoy it.

    I’m well aware of the health risks. I know I’m trading off the pleasure I get now against the probable loss of some of my ‘drooling years’.

    I favour high levels of education and control, within reason.

    But it seems to me that one of the main problems with the anti-smoking lobby is that it’s run by zealots who see nothing short of total abolition as acceptable policy. Because they are zealots they are – by definition – ‘unreasonable’ about this.

    Beside any scientific or health qualifications they may have, their main motivation appears to be to demonstrate that they know better than we do what’s best for us. At what point do they begin to think ‘Maybe we’ve done enough’? There’s no sign of it yet.

    If tobacco taxes continue to rise inexorably, I’ll certainly explore the illegal alternatives. A push to total prohibition always produces that effect. Think of it as Newton’s Third Law of Social Control, producing an equal and opposite reaction to that intended.

    Perhaps if they had a few actual smokers on their boards and bodies, there might be a better chance of finding reasonable middle ground. I.e. that point where an effective disincentive doesn’t effectively become punishment …

    I’m available if they are interested.


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