Tuesday, 21 March 2017

Alcohol, productivity and morality

Work has been pretty busy lately, so I hope readers will forgive me posting about what might seem to be ‘old news’.  But, as anyone who’s studied policy relating to alcohol or other drugs for any length of time will surely agree, the issues tend not to go away, but cycle round to be viewed in a new light.  And it’s precisely that sense of history that’s prompted this post.

The blog started with a neat ‘parable’, credited to economist Frederic Bastiat, of a shopkeeper whose window is smashed, who tries to look on the bright side by saying that at least replacing the window will keep the glazier in business.  The point is, of course, that the shopkeeper would have been able to spend the same money on something else had the window not been broken, and kept maybe a cobbler in business while seeing a tangible improvement in his own life.  And similarly, it’s claimed, we shouldn’t worry about harming the economy if we reduce alcohol consumption or even the money spent on alcohol, as this can simply go on something else.

My initial reaction was to take issue with Aveek on two points.  First, whether the alcohol industry is really anything like the glazier in the story.  Isn’t the role of the glazier played by the police, NHS, or alcohol charities, repairing damage caused by alcohol?

But I suppose if the alcohol industry really is the glazier, then we’re not suggesting that all windows/alcohol are bad, or a waste of money; simply those where the spend is the result of some kind of damage.  By my understanding, the analogy would then run that we shouldn’t be vandalising (or consuming somehow irresponsibly), but windows/alcohol can be useful, beautiful, and part of a healthy economy.  Windows in themselves aren’t undesirable or immoral.

And this got me thinking: maybe I’m over-thinking this.

Aristotle! if you had had the advantage of being ‘the freshest modern’ instead of the greatest ancient, would you not have mingled your praise of metaphorical speech, as a sign of high intelligence, with a lamentation that intelligence so rarely shows itself in speech without metaphor, — that we can so seldom declare what a thing is, except by saying it is something else?  (Eliot, The Mill on the Floss)

So let’s aside whether the alcohol is like glass, and focus on the second area where I was going to take issue with the argument: that economics has anything to do with this at all.

Setting aside Aveek’s personal position, as everything I’ve read by him suggests he’s open, honest and sincere, I started to wonder how well this argument fitted with whatever corporate view the IAS might have.  I just wasn’t convinced that their hearts would really be in it.

I started to think of why I set up this blog in the first place: frustration at the disingenuous nature of much public policy debate in the two fields I’ve worked in.  Drug treatment was justified by painting ‘addicts’ as dangerous, and higher education funding was justified by boosting economic productivity.

Neither actually gets to the heart of why I think these things should be supported.  Drug workers haven’t come into the field to reduce crime, and most academics don’t see their vocation as being to enhance graduate ‘employability’ or develop a productive ‘spin-out’ company.

Moreover, from a pragmatic point of view, I’d worry that when economic times get hard despite the continued existence of Oxford University, or acquisitive crime becomes less of a hot-button topic, the power of those narratives falls.  You haven’t won the fundamental argument that these policies are a ‘good thing’.

Similarly, I wondered, was economics really why the IAS opposed alcohol, or certain forms of alcohol consumption?  What if the data shifted and suggested that alcohol was a genuine boost for the economy?  (That’s certainly a tactic being used by people seeking cannabis policy reform.)  Would that change their minds?  Of course not.  So I was going to write about how the IAS is using economics disingenuously to justify what is really about morality or public health.

But then I realised I was doing exactly what I complain about other people doing: simplifying the argument into an either/or, or looking for the single factor that ‘explains’ their position.

I stepped back, and started to think about how, in reality, we tend not to separate economics from morality.  Whether it’s debates about benefits or executive pay, the argument can rarely be boiled down to a question of objective market factors.

And the same applies to this issue of alcohol and morality, health and economics.  There’s a long history of ideas of productivity being linked with discipline, morality and temperance – just think of the Protestant Ethic and the strong influence of non-conformists in the temperance movement.

In fact, the IAS has its roots precisely in that tradition, being an outgrowth of the UK Alliance, itself founded by non-conformist advocates of temperance.

(I’m hoping I don’t get pulled up too much on my knowledge of Victorian religion and the temperance movement – I’m just making a broad point.)

So my point – apart from illustrating how I argue against myself in my own head – is simply to note how several motivations and perspectives might well come together at once.  When we think about productivity, we might well be thinking about morality too, and that might be tied up with an idea of a healthy, active body as much as an economically productive mind.  It really is a coherent vision of how we could all be fitter, happier and more productive if we only drank less.

The only problem with this is that, precisely because the worldview is coherent and consistent, it challenges the idea that these debates about economics are somehow objective.  This is, as ever, a discussion about ‘the good life’, to return to Aristotle.  And, inevitably, we won’t all share the same vision of what that is.


  1. Measuring the economic value of alcohol, or anything, by the number of jobs created is a bit of a red herring. The benefit of alcohol is not that the industry is worth £46 billion a year, it is that the people spending that £46 billion would not rather do anything else with that money. If alcohol did not exist they would have to spend those billions on their second preference and would therefore be worse off.

    1. First off, glad you agree that the economic benefit of the alcohol industry is not measured by its revenue or employment - that's a point that is all too often lost on people.

      The economic benefit you're describing is consumer surplus, which was beyond the scope of my report. For obvious reasons, it's hard to measure quantitatively, but the IFS make an attempt in their recent paper on optimal taxes, which suggests that even accounting for consumer surplus, alcohol taxes should be raised in order to address externalities: https://www.ifs.org.uk/uploads/publications/wps/WP201702.pdf

    2. Yes, I saw that. The IFS uses the 2003 Cabinet Office study which doesn't give a realistic estimate of externalities as I've explained here: https://iea.org.uk/wp-content/uploads/2016/07/DP_Alcohol%20and%20the%20public%20purse_63_amended2_web.pdf

  2. Hi Will,

    Thanks for taking the time to read and engage with the report. I just wanted to give you an idea of my motives and objectives in writing it, as I think you’ve mischaracterised them a bit (understandably – it’s pretty clear from the blog that you are speculating!).

    I think you’ve overestimated the extent to which this is a positive agenda, rather than a reactive one: the report is intended primarily as a rebuttal of bad arguments, particularly the idea that just because the alcohol industry makes a lot of money and employs a lot of people, that represents a positive net contribution to the economy.

    It might be helpful to give you some sense of the genesis of the report. As I’m sure you’re aware, IAS, following the academic consensus, believes that raising alcohol taxes is among the most effective ways to reduce alcohol-related harm. That’s why I’ve been working predominantly on tax issues for the last year and a half. Of course, discussions on tax are inevitably framed around the economy, even if we would prefer alcohol taxes to be used as a tool for promoting public health. I was frustrated because I thought that we had too little to say on economic questions, that we were too easily ceding this ground to what I perceived as relatively weak arguments from the alcohol industry. This report originated as a way to scrutinise the economic claims that are made by industry groups. So it wasn’t prompted by a desire to promote economic arguments, but rather a response to the inevitability that economic arguments are used in the debate, and an attempt to assess their validity.

    The report was not informed by any IAS ‘corporate worldview’. The non-conformist Protestant ethic doesn’t really inform my day-to-day activities, to be honest. The report was conceived, researched and written by me with little top-down direction. It was deliberately intended to consider economic questions more or less in isolation from the rest of the alcohol policy debate. As a result, the framework I used was a standard macroeconomic approach, and it was reviewed by independent economists. In the report, I don’t take a position on whether viewing alcohol through an economic lens is appropriate or not, I just note that it is something policymakers do in practice.

    You are almost certainly correct that in general people often have difficulty in separating economic from moral issues. But in this specific case, I made a conscious effort to make that separation, and I am pretty happy that I succeeded.

    1. Thanks for engaging, Aveek. I suppose the context is that I was really using the report as a jumping off point to riff on ideas about morality and policy that have bubbling around thanks to people and organisations like Henry Yeomans (in relation to alcohol) and VolteFace (on other drugs).

      In lots of ways, the alcohol industry mirrors all industry arguments, particularly around budget time – where suddenly industries or companies create jobs, or are responsible for specific bits of growth / GDP. And that’s where the window analogy is useful. It’s not unique to alcohol, but it seems to be a standard lobbying technique.

      I take your point about your own perspective, and seeing what you felt to be weak and questionable arguments being presented by the industry, but fundamentally this is a research/policy agenda IAS has signed off on, and that interests me, because, as I say, I don’t believe that they would change position if it turned out that alcohol caused certain health conditions that meant overall, due to lack of long-term care, or pension requirements, the state didn’t lose money through alcohol.

      What I mean is, from neither the industry or yourselves, this isn’t really about economics. As you say, you don’t take a position on whether viewing alcohol through an economic lens is appropriate or not, and this isn’t a ‘positive agenda’ for IAS; it’s a response to an industry tactic. And equally, I’m not sure theirs is much of a ‘positive agenda’ either; they’re using a standard lobbying angle, which I’m pretty sure most people involved in decision-making know is simplistic, at least in the medium/long term. Their fundamental concern is for their own profits, and that of IAS is a particular understanding of health and wellbeing that sees (particular forms of?) alcohol consumption as undesirable.

      So what I mean is: I find the whole discussion of the economic ‘benefits’ of alcohol a side show. Whatever the findings, I don’t believe it would change the position of either ‘side’. And because of the way people’s general conceptions of ‘good’ and ‘bad’ are formed from all those elements I mentioned that comprise the ‘good life’, I don’t think we should overstate the importance of economics, either in ideal or real conditions of policymaking, or portray it as a science that will produce the ‘right’ answer.

      Anyway, I think that’s enough from me! Cheers for engaging – I’d be happy to keep the discussion going.