The Price is Wrong

Taken in a designated "no smoking" area

The year is 2001 and the Czech Republic is considering levying an exorbitant tax on cigarettes to encourage smokers to quit. Facing the possibility of declining future profits, Phillip Morris commissions and sends a report to the Czech government detailing the benefits of smoking. Benefits? Yes, benefits. But not what you’re thinking about.

This report wasn’t about how cool you look when you smoke or how smooth and tasty Marlboros are. In fact, the report was mostly about how terrible tobacco is for one’s health and well being. It outright admitted that cigarettes are carcinogenic and are linked to early death. It then proceeded to argue that this was in fact, a good thing. The money saved in un-cashed pensions, healthcare, and housing for the elderly more than made up for the costs of premature death. Basically, Phillip Morris was saying that if people smoke, they’ll die sooner so the government won’t have to pay to take care of them and that these savings would add up to more revenue than the new tax would take in. Never mind that the report was based on highly selective data and has since been discredited by independent analyses–the very idea that it was commissioned in the first place is grounds for moral outrage. Thankfully, the Czech Republic was unswayed by this testimony and succeeded in raising its tobacco taxes. Phillip Morris later issued a public apology and admitted that it was immoral to commission the analysis in the first place. Even so, this information was out there and there was no turning back.

For now though, let’s leave PM alone and talk about something completely different: China’s One Child Policy. Introduced in 1978, it was China’s answer to its overpopulation problem. Aptly named, it limited the number of allowable children per couple to one. At the time, this seemed like a good idea and it has been prodigiously successful in achieving its goal of curbing population growth. It’s estimated that it prevented over 250 million births between its introduction and the year 2000. But now as the parents of these single children age, they are reaching the time for retirement which poses a whole new problem.

Traditionally, it has been up to the children to take care of their parents in their old age. This is not such a huge burden when split between two or three siblings but when one married couple must support for two parents from each bloodline, the weight can often become too much to bear. So what to do? The truth is, no one knows. Much like Social Security in the USA, the system is broken and seemingly unfixable. Or so it appears.

As previously mentioned, the findings of Phillip Morris’ “Death Benefit” analysis are out there for all to see and evidently, there are those who have seen and it. Having lived in China for almost two months, my biggest pet peeve (besides transportation) is definitely the omnipresent cigarette smoke. Coincidentally, cigarettes are dirt cheap and compared to other countries, leniently taxed (40% vs 60% world average). While the government claims to want to deter smoking, its actions speak louder than its words.  In a country where tobacco companies are allowed to sponsor elementary schools and tell kids that “Talent stems from hard work, tobacco helps you become accomplished,” it wouldn’t surprise me if there was a copy of the Death Benefit analysis on the minister of health’s bookshelf.

At this point I would not lend any more credit to my allegations than I would to Glenn Beck’s ramblings but to quote America’s favorite rodeo clown® it’s “right under your nose if you’re willing to open your eyes to see it.” In all seriousness though, it does seem to be the perfect solution to China’s old people problem.

Update: I just came back from the bathroom where 3 people were smoking oblivious to the “Smoking Prohibited” sign right at eye level behind them. Sigh

1 Response to “The Price is Wrong”


  1. 1 fantus August 11, 2010 at 4:54 am

    Well, once again, you have hit the nail on it’s head. this time very hard!!!!


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