Calif.: Nickel a Drink to Keep the Deficit Away

Calif.: Nickel a Drink to Keep the Deficit Away
November 10, 2008

News Summary

Just days after Calif. Gov. Arnold Schwarzenegger proposed raising alcohol taxes by five cents per drink to patch up the $11.2 billion deficit in the state budget, other states are being urged to follow suit.

The San Jose Mercury News reported Nov. 7 that Schwarzenegger proposed the alcohol tax along with taxes on veterinary clinics, auto repair, and golfing fees to raise $4.7 billion in new revenue. Republicans have said they will oppose the proposal, but Schwarzenegger is still hopeful that it will pass.

"A drastic situation like this takes drastic measures," Schwarzenegger said.

Such an increase in other states could raise as much as $355 million in New York, and $430 million in Florida, according to Marin Institute, a California-based alcohol industry watchdog. "A nickel a drink -- it's the change we need to fix budgets around the nation," said Bruce Lee Livingston, executive director of Marin Institute. "The largest states, such as New York and Florida can avoid cutting essential programs through long-overdue alcohol tax increases."

COMMENTS ON THIS ARTICLE:

Posted by Donald B Parsons on 12 Nov 08 08:18 AM EST

Sure the government BREAKS the bank by earmarking money for their pet projects and all sorts of B.S. crap and then want taxpayers to shell out more money instead of being fiscally responsible. Lets let "WE THE PEOPLE" have a say in what our government spends our money on before they spend it. Lets have some transparency and accountability in government instead serving their own self interests. We here in Maine just shot down such a tax hike so good luck Mr. Terminator. Heres a piece of advice for you STOP LOCKING UP NON-VIOLENT DRUG OFFENDERS and use that money WISELY. Almost 1 MILLION NON-VIOLENT DRUG OFFENDERS PER YEAR for the past 10 years adds up to A LOT OF $$$$$$$$$ .....

Posted by John fron Oceanside on 12 Nov 08 10:22 AM EST

Hey Donald part of Arnold's proposal is to let out some drug offenders. What that means is drug dealers because in Calif. Drug Users go to treatment and it has been that way for the past 15 years, even before DPA got Prop 36 passes.

Posted by Been there on 12 Nov 08 01:38 PM EST

Nickel a Drink? Sounds familiar ... I believe there was a nickel a drink campaign way back in the late '80's with the revenue going to programs, emergency rooms, prevention and other worthwhile causes that are a needed commodity as a direct result of the alcohol industry's product and advertising. It was a smart initiative then but didn’t pass because of the tactics of big alcohol- no reason is can't work now as long as Auggie Busch and his cronies don't strong-arm again. BTW-I believe the Century Council was established to counter-act that specific initiative. As far as non-violent drug offenders, they are offenders and should be held accountable along with any opportunity for treatment but ONLY on a volunteer basis with no special privileges. Ever hear of co-dependent behavior?

Posted by Donald B Parsons on 13 Nov 08 09:09 AM EST

Proof is in the pudding and I haven't seen any supporting facts. To the contrary , we hear about how full the prisons are and talk of building more. Prisons were supposed to keep the dangerous people away from harming society not as rehab center for millions of drug offenders. I feel like I'm talking to a wall sometimes so I'll concede this time as you are native to California and all I know is that Arnold is asking the government for money when it can be found by cutting non-essential programs such as housing druggies at about 35,000 dollars a year PER PRISONER and thats not the half of it.

Posted by bfinn@preventionnetwork.info on 14 Nov 08 09:02 AM EST

Let's get a perspective o n consumption rates. 30% of the adult population consume 0% of the available alcohol while another 50% consume approximately 20% of the alcohol. That leaves two more groups, 10% of the adult population are alcohol abusers consuming approximately 25% of the booze and the addicted 10% consume 45% of the booze annually. We NEED TO SERIOUSLY pursue this tax to support the base of current addiction services...in NYS the mantra is, "Prevention, Treatment, Recovery". Cuts to any three of these effective strategies means tremendous residual increases in other costs. Taxing the alcohol industry, which is profiting from the 20% abusing/addicted, is a cost effective measure. BRAVO to CA....let's follow suit.

Posted by John from Oceanside on 17 Nov 08 10:29 AM EST

Donald you keep hearing stuff because you only listen to DPA and won't believe anyone but DPA. California has been doing alternative sentencing since the 1990.

Posted by Deborah D. Dupire-Nelson on 17 Nov 08 06:23 PM EST

Isn't the "nickle-a-drink" idea just exactly the same 1990 California public ballot initiative (S.F. Trauma Foundation genesis) that many of us labored for months and months to get passed into law? (Ultimately, it was defeated in 1990, in favor of a watered down concession version by the alcohol industry.) Good for Governor Swarzenegger for picking up the gauntlet and making this concept into his own!

Posted by David Bergstein on 20 Nov 08 10:38 AM EST

There is nothing simplistic about taxes. On one hand, they increase revenue, on the other, they decrease it as people spend less. One might argue that lowering taxes would increase revenue, just as when a store lowers prices. But lowering taxes on alcohol would increase drinking, thus increasing medical costs, accidents, etc. The solution is not an easy one but should not be placed on working people who merely want a drink after work. One of my pet solutions is to increase fines for lawbreakers so they would be paying for their court and jail costs instead of those who have never seen the inside of such institutions. The problem here is that it's easy to tax working Joe's, as they have few advocacy groups. Discuss making criminals pay for their jail expenses (which would make committing a crime less worth it) and their advocacy groups would yell the loudest. But, why am I paying for someone's incarceration? Imagine getting mugged and them paying for the muggers jail time...

Posted by Lembi Buchanan on 02 Dec 08 04:45 PM EST

A similar proposal was made in Canada in May 2008 to increase the excise tax on alcohol by a nickel a drink to raise money to pay for mental health and addictions programs. It didn't happen. Instead, a new charity was created, Nickel-a-Drink for Addictions and Mental Health Research Foundation. Please visit www.nickeladrink.com for more info.

Posted by Petty Officer Johhson of The United States Navy on 06 Dec 08 06:47 PM EST

I really do agree with this proposal. i think it should be expanded a little more. a nickel a drink really is not a lot. 20 drinks later you would have only spent a dollar more. i think it should go as far as 10 cent per pack of cigarettes. as a current smoker i do not believe that is a lot out of my pocket. but when you add together the entire nation that would make such a dent in our countries deficit. i think all states should implement this and have 100 percent of it go to the countries deficit. I also agree that the government spends a lot more money on unimportant things like non violent drug offenders, being from California i know that drugs are a hug problem but not a big enough problem to throw away that much money and double the states deficit. Arnold focus on the important things and prioritize, listen to the people a little more and you would know whats important, a government for the people, by the people.

Posted by Lee on 17 Dec 08 12:52 PM EST

Big alcohol business? We're a small winery and the effect this would have on us is simple: 1. We'll pass it along to the consumer in a price increase. 2. Our sales will drop. Our inventory turns will drop. Our carrying costs will rise. Another price increase. 3. Our production will shrink due to excess inventory. I'll lay off workers to keep the doors open. Keeping the tax rate static in California is still a revenue increase due to the RESPONSIBLE use of wine in our market. People are drinking more because of the many benefits. Why punish the producer for the abuse of the few? Can someone please point out where the current windfall of excise tax in CA is being spent? Can someone guarantee these government agencies and programs are being run efficiently without waste? Find your revenue in the waste and incompetence, not in our success.

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