Friday’s ad is for Tennent’s Pale Ale, who apparently are “The Aristocrat Of Beer.” Though the Wellpark Brewery is, or was, a Scottish brewery, the ad appears to be from Australia. Though from when I can’t be sure; perhaps the 1950s, although the bottle looks even older than that?
Thursday’s ad is from the 1950s, for the English brand John Smith, specifically their Magnet Pale Ale, which they registered as a trademark in 1911. This ad appears to use a Marilyn Monroe lookalike, or at least drawn-alike, to entice people to but John Smith’s Magnet Pale Ale, along with the tagline. “A Magnet for me!”
Given that the anti-alcohol folks, and especially my churlish neighbors Alcohol Justice, are continually beating the drum about alcohol taxes being too low, this news is not going to be particularly welcomed with open arms. A British think tank, the Institute of Economic Affairs (IEA), recently took a close look at the effect of higher taxes in alcohol and their report, Drinking in the Shadow Economy, found that the British “Treasury is losing as much as £1.2 billion every year to the illegal alcohol industry.” That, they conclude, is one of the effects of higher taxes on alcohol, because it creates an incentive for people to go outside the law and the safe world of regulated alcohol to make a quick buck. They found that “the illicit alcohol market is also closely associated with high taxes, corruption and poverty. The affordability of alcohol appears to be the key determinant behind the supply and demand for smuggled and counterfeit alcohol.” So place too high taxes on alcohol, and you invite in the wrong element, which we’ve seen in the U.S. before during Prohibition, and which we’re seeing right now with the war on drugs. If that futile policy was reversed, we’d save as much $13.7 billion annually by legalizing, regulating and taxing just marijuana, not to mention we’d remove the criminal element, make it safer and drastically reduce burdens on police, the justice system and prisons.
But back across the pond, the study also notes that the “demand for alcohol is relatively inelastic,” meaning people generally don’t drink less when prices go up, they instead find new ways to address the rising prices. As study after study has concluded, tax hikes are regressive and almost always hit poorer families the hardest, while not eliminating the problem the proponents of such measures claim they will fix.
But here’s that again, said another way:
Our analysis indicates that the affordability of alcohol does not have a strong effect on how much alcohol is consumed. Once unrecorded alcohol is included in the estimates, it can be seen that countries with the least affordable alcohol have the same per capita alcohol consumption rates as those with the most affordable alcohol.
I suspect that’s the case here, too. We know that price hikes cause people living near borders with other states to simply buy their alcohol in the next state over, causing further economic erosion. I don’t know if we have the same issue with counterfeit or illegal beer. Certainly there’s still Moonshine, but beer is probably not profitable enough on its own to warrant illegal breweries flaunting the tax code, not to mention how labor intensive and technology-dependent it is.
Another interesting portion of the report, answering the question “Why Tax Alcohol?”
Temperance and public health campaigners typically dismiss the black market as a problem that can suppressed through rigorous enforcement and tougher sentencing. At worst, they view a growing unofficial market as a price worth paying for a more sober society. This view is rooted in the belief that affordability is the main driver of alcohol consumption and that increasing prices by raising excise duty is therefore the single most effective way of reducing alcohol sales.
Ceteris paribus, economists would expect there to be some truth in this assertion, but there is too much real world evidence to the contrary for it to be taken as an iron rule. For example, alcohol consumption has fallen in most European countries since 1980 despite alcohol becoming significantly more affordable (OECD, 2011: 275).19 In Denmark, Sweden and Finland, the sudden drop in alcohol prices that resulted from EU accession did not bring about the kind of surge in alcohol consumption that the price elasticity models predicted.
A comparison of European countries suggests that affordability has a negligible and statistically insignificant negative effect on recorded alcohol consumption (see Figure 12). Moreover, as Figure 13 shows, when unrecorded alcohol consumption is included in the analysis, affordability does not appear to be a decisive factor in determining alcohol consumption from one country to the next.
Then there’s this long passage addressing some of the philosophy behind taxation which seems to fly in the face of much of the neo-prohibitionists propaganda playbook:
Contrary to temperance rhetoric, high alcohol taxes are not necessarily good for public health because, although excessive alcohol consumption undoubtedly carries risks to health, so too does moonshine. Counterfeit spirits and surrogate alcohol frequently contain dangerous levels of methanol, isopropanol and other chemicals which cause toxic hepatitis, blindness and death. These are the unintended consequences one associates with prohibition, albeit at a less intense level than was seen in America in the 1920s.
It should not be surprising that excessive taxation encourages the same illicit activity as prohibition since the difference is only one of degrees. As John Stuart Mill noted in 1859: ‘To tax stimulants for the sole purpose of making them more difficult to be obtained is a measure differing only in degree from their entire prohibition, and would be justifiable only if that were justifiable. Every increase of cost is a prohibition to those whose means do not come up to the augmented price’ (Mill, 1974: 170-171).
But in a less frequently quoted passage, Mill appears to approve of taxing alcohol to the apex of what we now call the Laffer Curve. Appreciating that governments need to raise funds and that these politicians must decide ‘what commodities the consumers can best spare’, Mill argues that taxation of stimulants ‘up to the point which produces the largest amount of revenue (supposing that the State needs all the revenue which it yields) is not only admissible, but to be approved of’ (Mill, 1974: 171).
This message tends to resonate more powerfully with politicians than Mill’s more libertarian pronouncements. Drinkers generally prefer low alcohol prices. Temperance campaigners nearly always demand higher prices. The politician, however, usually seeks to maximise tax revenues and will only react to the shadow economy when it becomes a serious threat to state finances. Nordlund and Österberg summarise the politician’s dilemma as follows:
‘Domestic economic actors can, of course, support the rules and regulations imposed by the state for controlling unrecorded alcohol consumption, but for these actors a better solution in combating unrecorded alcohol consumption would be the lowering of alcohol excise taxes… In most cases the state is not willing to follow this policy, as lower alcohol excise taxes in most cases mean lower levels of alcohol-related tax incomes. However, if the state is no longer able to control the amount of unrecorded alcohol consumption by different kinds of legal administrative restrictions the only remaining way to counteract, for instance, huge increases in travellers’ border trade with alcoholic beverages or an expansive illegal alcohol market is to lower the price difference between unrecorded and recorded alcohol by decreasing excise taxes on alcoholic beverages.’ (Nordlund, 2000: S559)
It scarcely matters to the politician whether unrecorded alcohol comes from legal or illegal sources. In either case, the treasury loses out on revenue. In Britain, HMRC estimates that the alcohol tax gap could be as much as £1.2 billion per annum, plus the costs of enforcement, and that this is largely because ‘duty rates on alcohol are far higher in the UK than in mainland Europe’ (National Audit Office, 2012: 2, 10). This is the price the state must pay for excessive taxation, but the politician is also aware that these high alcohol taxes raise £9 billion a year (Collis, 2010: 3). Being in possession of these facts he may conclude that reducing the illicit alcohol supply through tax cuts will probably reduce net alcohol tax revenues.
We argue that such a focus on maximising tax revenues is short-sighted and carries significant risks. Failing to deal with alcohol’s shadow economy threatens not only the public finances, but also public health and public order. Unrecorded alcohol has, as Nordlund and Österberg note, ‘the potential to lead to political, social and economic problems’ (Nordlund, 2000: S562). In addition to the health hazards presented by unregulated spirits, alcohol fraud in the UK is, according to the HMRC, ‘perpetrated by organised criminal gangs smuggling alcohol into the UK in large commercial quantities’ (HMRC, 2012: 8). Alcohol smuggling and counterfeiting is linked to other illegal activities, including drug smuggling, prostitution, violence, money-laundering and — in a few instances — terrorism.
Incidentally, you can download a pdf of the entire report here, and at the IEA website.
In the press release, the IEA concludes:
“The government’s focus on maximising tax revenues is short-sighted and dangerous. Aside from losing money by encouraging consumers to find cheaper illicit alternatives, public health and public order are also being put at risk by high prices. Policy-makers ought to take the threat of illicit alcohol production seriously when considering alcohol pricing in the future.”
“There is a clear relationship between the affordability of alcohol and the size of the black market. Politicians might view the illicit trade as a price worth paying for lower rates of alcohol consumption, but this research shows that the amount of drink consumed in high tax countries is exactly the same as in low tax countries.”
“Minimum alcohol pricing might seem like a quick fix to tackle problem drinking, but it is likely to cause many more problems by pushing people towards the black market in alcohol.”
While a fairly emphatic statement against higher taxes on alcohol, I assume that many will still wonder how applicable it is to the United States economy and society. Honestly, I’m sure there are differences, but the overall concept seems sound, at least to me. We can haggle over some of the details, but the idea that higher taxes isn’t always the answer just has the ring of truth to it.
I can only assume that the UK pub chain Taylor Walker is, in the appropriate British parlance, taking the piss, with their commissioning of Mindlab to discover the formula for “the perfect pint.” Though there is a Mind Lab at the University of Sussex, this bit of news is not listed in their news or press section. At any rate, they claim to have “used complex mathematical modelling techniques to discover what conditions are required to enjoy the perfect pint.”
So what is the formula for a perfect pint?
Here goes: E = -(0.62T2 + 39.2W2 + 62.4P2) + (21.8T + 184.4W + 395.4P + 94.5M – 90.25V) + 50(S + F + 6.4)
- E is a factor describing overall enjoyment.
- T is the ambient temperature in degrees Celsius.
- W is the number of days until you are required back at work.
- P is the number of people with whom you are drinking.
- M is related to your mood whilst drinking the pint.
- V is related to the volume of the music being played.
- S and F are related to the availability of snacks and food.
Without the number variants, so slightly simpler, it’s E = -(T2+W2+P2) + (T+W+P+M-V) + 50(S+F+6.4), though it’s hardly E = MC2. Below a presumed “scientist” — he is after all, wearing a lab coat and surrounded by books and beakers — explains it all:
Wednesday’s ad makes quite some bold claims. It appears to be a 19th century ad for the newly modernized Notting Hill Brewery Co., which had just started a “revolution in English Bottled Beer Produced Entirely on a New System.” I especially love the twin banners, that don’t quite seem to work together: “No Deposit” and “No Sediment.”
Well this is a tidy bit of news. CAMRA is reporting that the number of breweries in the United Kingdom is now over 1,000 for the first time in over 70 years. Other tidbits include that there are “[t]wice as many brewers now in operation compared to a decade ago” and the “[n]umber of micro breweries have risen despite recession and pub closures,” something we’ve also experienced here in the U.S., too. You can read the full story in the Scotsman, but tonight I think an English beer may be in order.
Thursday’s ad is from 1957, for the British brand Mackeson’s Stout. It’s a simple black and white line drawing of a hand holding a titled glass of stout, having consumed a portion of it, maybe as much as half. The tagline, “You’ll like it better!,” begs the question, better than what exactly? Who was their main competition in 1947? Other stouts, or lighter-colored beers?
Here’s an interesting old video from 1933. It’s from the British Pathe Archives, from the “Secrets of Nature” series entitled Brewster’s Magic. It was a British Instructional Film, photographed by F. Percy Smith, with Editing and Commentary by Mary Field and “Musical setting” by W. Hodgson.
The 8-minute black and white film shows time lapse photography of hops and barley growing plus microscopic images, as well. Here’s how they describe the film:
Hand pump being pulled in a pub. Hop root. The eyes are pointed out with a pencil. Time lapse photography of a hop shoot growing. C/U of the claws on the stem of the plant. Plant grows. The claws help the hop plant to twist its way around a smooth surface. Hop flowers growing on a male hop plant. Female hop plant produces flowers. We see them grow through time lapse. Comment on the voiceover about flowers being disappointed spinsters as they will not be fertilised. The flowers continue to grow. C/U of the sticky substance that grows on the petals. Lupelin (sp?) highly magnified. This is the substance that gives flavour and aroma to beer.
Hop garden. Barley ripening in the fields. C/U of barley submerged in water. Time lapse of the barley absorbing water. Barley puts out shoots in time lapse. The maltster turns them upside down to stop them from growing too quickly. Water supply is cut off and the barley withers. Graphic representation of the barley shoot. Animation. Maltster kills the barley grain when it has produced digestive fluid but not had time to use it. Grains are mashed up in hot water to make malt. Men roll barrels along in courtyard of brewery. C/U of yeast cells under a microscope beside a human hair. Moving yeast cells. Cells separate. Fermentation. Diagram of a molecule of sugar. Animated letters. Solution under the microscope. Bubbles are formed.
A pint of beer is pulled in a pub. Shot of man in flat cap drinking beer from a pewter tankard.
It’s a cool time capsule and definitely worth checking out.
My only quibble is that despite it being almost 80 years old, Pathe still asserts copyright on it. Which is fine, in and of itself, even if I generally disagree with how long copyrights now tend to run. But for some reason, they think it’s reasonable to charge you a whopping £50 ($77) to buy the 8-minute video, and that’s just for a download of it — no DVD or case or artwork, though they graciously will allow you to burn it to your own DVD. How thoughtful. Anyway, as a result, it can’t be embedded and viewed here. Fortunately, you can at least watch it at the Pathe website. Enjoy.
Also, there appear to be a wealth additional historic videos on both beer and hops that look like you could lose an entire day exploring.
Another classic propaganda study was just released in Britain, using the all-too-common meme of “think of the children” as the wedge to attack alcohol advertising. Ever since Prohibition ended miserably here in the U.S., anti-alcohol groups turned their attention to other methods of crippling alcohol, and attacking advertising has been a favorite strategy. It’s quite common in the UK, too, as similar groups there have no doubt witnessed its effectiveness on our side of the pond. This one is being reported by the Daily Mirror as More Children Familiar with Alcohol Brands Than Snacks, which is no doubt exactly the alarm that the anti-alcohol organization behind it was hoping to raise. The so-called “study” the Mirror is reporting on was conducted for Alcohol Concern, a “national charity on alcohol misuse” which certainly sounds like one of our American organizations that cover themselves in the cloak of health and concern for the children.
So let’s look at the study. 400 children, ages 10 and 11 (the same age as my son Porter), were shown brand names and images. Of those, 79% correctly recognized Carlsberg as a beer, or at least as alcohol. The same percentage also correctly identified Smirnoff as alcohol whereas only 74% recognized Ben & Jerry’s Ice Cream (which must have greatly chagrined Ben & Jerry’s ad agency). Oh, the horror! From there, of course, the leap is made that tighter controls need to be placed on the advertising of alcoholic beverages lest the kiddies remain able to know what’s alcohol and what’s not. Because if children know which brands are alcohol, then obviously they will drink them. If then can identify them, then obviously they’re being targeted and all ads therefore “encourage immoderate consumption.” Alcohol Concern asserts that alcohol advertising must be “not attractive to children,” as if adults and children like completely different things.
Okay, a couple of things. First, being able to identify which brands are alcoholic drinks and which are not does not mean the recognition came from advertising. That almost 4 out of 5 kids could identify Carlsberg, one of the best-selling beers in the UK, is just as likely due to its popularity, being in those kids’ homes, sitting in the refrigerator, and seeing their parents drinking it. Or seeing it when they’re at the local football game, with family and family friends drinking it while watching the game; or at a picnic; or they may see it walking the supermarket aisles as their parents shop. There are many places where kids can see alcohol brands, including many positive experiences, that do not have to do with advertising. Kids do not have tunnel vision and only retain what they see in ads on television. Yet Mark Leyshon, from Alcohol Concern, insists their “study” does “provide more evidence that alcohol marketing messages are getting through to young people well before they are legally able to buy alcohol.” I’d say that’s true only if you ignore reality.
On some level, isn’t it good news that kids know the difference between alcohol and soda? And guess which one they prefer? Think about it. Do kids like bitter tastes like beer or sugary sweet flavors like soft drinks? Study after study I’ve seen, and not just ones by neo-prohibitionists, always show young people prefer sweet tastes over bitter ones. I know my kids do. Don’t yours? So it’s in their interest — and yours and society’s if the anti-alcohol nutjobs are to be believed — if they don’t accidentally reach for a bottle of Carlsberg thinking the green bottle contains Sprite or 7Up? Knowledge should be a good thing, but apparently Alcohol Concern thinks it would be better if our children were completely ignorant.
Second, the study itself seems overly simplistic at best. The kids were shown “the brand names and logos of common alcohol products, as well as images from TV alcohol advertisements,” along with “brand images, logos and TV adverts for popular non-alcoholic products such as soft drinks and breakfast cereals.” Then it was multiple choice. The kids could choose for each image they were shown between three choices: “food,” “soft drink” or “alcoholic drink.” I can’t speak for their ten and eleven year olds, but I’m fairly certain my own son (who’s 10-1/2) could do a pretty good job of just guessing between those three choices. Most successful brand images work because the association with the products are natural or complimentary, not inscrutable and hard to figure out.
But even so, would it have been better for children’s health if they could more easily identify the “soft drinks” or “sugary snacks,” which ultimately are at least as bad for their health as alcohol? I know that kids under 18 in civilized places (or 21 in places less so) should not be drinking alcohol, and I accept that children should not have unrestricted access to it. But the fact remains that, all things being equal, the excess sugar and other chemicals in soft drinks and many, many processed foods are terrible for everybody, children included. Yet Alcohol Concern — and indeed most anti-alcohol groups — seem to have no difficulty with the many unhealthy products in the world and are single-mindedly convinced that it’s alcohol alone that it is the cause of society’s woes.
For me personally, as a parent, I find this concern completely absurd, unfounded and misguided. My kids could name more alcohol brands than the average ten and seven-year old, because it’s “daddy’s work.” Their hearts sink every time a package arrives on our doorsep and it’s not a new book or toy, but instead is beer. Our house is full of beer. It’s lining the hallway, in boxes in the foyer, sitting around the dining room, the kitchen, the garage, and stuffed into four refrigerators. But my kids have no interest in it whatsoever. Zip, zero, nada. They know it’s “for adults.” And that’s partly why I’m convinced these sorts of attacks on alcohol advertising using children as a shield are not about the kids in the least. They never are. I’m glad my kids know the difference between what they’re allowed to drink and what they’re not. Don’t all parents teach their kids what they can drink? In our home, it’s simple, really. No soda, no beer and no alcohol. They know, and that knowledge is powerful and effective. Just say know.
Friday’s ad is for English brewery, H. & G. Simonds, Ltd. of Reading. I’m not sure of the age, but presumably it’s from the late 19th century when these great industrial portraits of breweries were so common. I love these pro-industrial love letters. A collection of them would make a great coffee table book.
