Paying For Unintended Consequences

June 4, 2012 § Leave a comment

I started reading Jason Ripley’s study as the feasibility of privatization in BC. A couple of stats jumped out at me. The first was the number of transactions. He estimates about 38m transactions per year. The second was the value of health care costs that are not covered by current LDB income and are a direct result of irresponsible liquor consumption. I’m not clear, I will have to re-read the section, how he was able to state that $60m were not covered by the current net income of the LDB, regardless I might have an answer.

In the study he notes the positive effect that minimum pricing, if at the correct level, has on irresponsible consumption. He also notes on a number of occasions that problem consumption is attributed most at the low end of the price scale. Specifically the highest alcohol for the lowest price.

Here is the solution. The caveat is that it will require government to directly feed the income from this proposal to cover excess health care costs. Something, that up until now, they have been reluctant to do.

$60m divided by 38m is $1.58/ transaction. Apply this to every separate transaction and have the funds go directly to health care. This would be a flat charge that is applied to every transaction no matter the value.

I wonder if a study can ever be done on the unintended positive effects of moderate consumption.

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