Medicaid’s Insolvent? Raise Booze Taxes!


The Foundation is always grateful when we’re allowed to present our research and analysis in the Albuquerque Journal. But sheesh, the paper sure has let some nutty ideas cluster on its editorial page lately.

Today’s kookiness arrives courtesy the “Alcohol Taxes Saves Lives & Money coalition,” which is pushing a “25-cent-per-drink increase in alcohol taxes.” The reason? The state’s unsustainably crushing Medicaid expenditures.

Citing the “Center [sic] for Disease Control’s Community Advisory Panel,” Peter Debenedittis argues that “raising alcohol taxes is the most effective way to reduce the health harms caused by excessive drinking.”

Maybe not. As the Franklin Center for Government and Public Integrity’s Jason Stverak noted: “Research by the National Institute on Alcohol Abuse and Alcoholism has found that hardcore alcohol abusers are affected little by increases in price, which have a greater effect on light and moderate drinkers. Additionally, studies show that beer taxes have an insignificant effect on underage drinking.”

Besides, it’s not as if New Mexico’s alcohol taxes aren’t high already. The beer tax is the same as Utah’s, but it’s higher than those in Oklahoma, Texas, Arizona, and Colorado. The Land of Enchantment’s levy on wine is greater than those found in each of its four neighbors that imposes a tax. (Utah controls all sales of wine.) And distilled spirits are taxed at a higher rate here than in Oklahoma, Texas, Arizona, and Colorado.

Hiking booze taxes to cover Medicaid’s profligacy is an excellent example of how Big Government perpetuates itself. One unwise public policy (expanding Medicaid) creates a fiscal crisis that makes another round of meddling (higher alcohol taxes) “necessary.” It’s a cycle that never ends — unless an informed and active citizenry sees to it that government is confined to its proper sphere.