Alcohol economics and politics: the case for policy activism

Staff Writer
An extra-ordinary public debate has been unleashed by the policy activism of the current national political leadership towards dealing with the challenges of alcohol abuse in the country.

Many perspectives are being offered with multivalent arguments coloured by economic, health, political, cultural and moral world views. As the debate rages and gains momentum, it is critical that the lessons on both democratic intentions and processes are learned.

Let me state at the outset that it is the responsibility of every accountable Government to seek strategic interventions to solving what cannot simply be brushed aside as matters of personal choice. Alcohol is not simply another economic commodity whose trade should be left to forces of supply and demand in a free market playground, it is destructive and addictive.

The World Health Organisation (WHO) Global Status Report on Alcohol (2004) puts Botswana on the number 104 spot with alcohol per capita consumption of 5.38 litres of pure alcohol, thus earning the country the infamous place in the top 10 leading guzzlers on the African Continent. The country is also 81 places below Uganda, which led the world on position 185 - 'shame Africa'!

Given these worrying facts, it is surprising that the drink trade has chosen to unleash its financial might to counter the current anti-alcohol activism adopted by Government. It is not convincing to argue that the mere introduction of a formal policy would address the challenges we face. Rather, what is required is a robust national strategy that is backed by policy.

It is strategic and also part of legitimate public policy activism to limit access to alcohol by reducing availability times, increasing taxes, adjusting age-restrictions and strictly enforcing the law. And it is long overdue because contrary to what some interest would like to mislead the nation, overwhelming evidence exists to show that packages of measures, including higher taxes and other restrictions on time and limits on age, do work.

Stakeholders need to recognise that excessive or binge-drinking is an explosive challenge, which if not tackled promptly and strategically, can undermine the realisation of Vision 2016 and the achievement of the MDGs.

Certainly individuals, industry and the nation can trade loss of enjoyment for gains in health, safety, family wellbeing, workplace productivity and public order. The view that alcohol is a recreational commodity or social lubricant that enhances the enjoyment of life is a plausible perspective, but it masks the social, economic and health costs that have to be paid by increased and irresponsible consumption. As said by Clarke (2007) 'a restriction to reduce consumption to the point where net social benefits are maximised then makes sense provided the cost of the restriction is less than the net benefit lost by not employing it'.

Clarke identifies three market imperfections that create a case for restricting alcohol consumption. These include the information availability, particularly understanding that alcohol is a neurotoxin that destroys brain cells, with few health benefits. The second imperfection concerns self-control issues - the fact that alcohol is a habit forming or addictive commodity. The third concerns externalities, mainly the personal or social costs to families, communities, and nations, from the dysfunctional behaviour of drinkers.

A fourth reason for intervention mentioned by Clarke, which is, however, unrelated to market failure (and not very helpful), pertains to obsessive paternalism usually accompanied by moral and emotional arguments against excessive alcohol consumption, which may result in taxes being set above externally-correcting levels. Certainly Botswana cannot be said to be a 'nanny state' of moralisers and do-gooders for pushing what some have reduced to being a paternalistic agenda to the forefront of public policy debates. To guard against being viewed as obsessively paternalistic, policy interventions must be supported by unquestionable facts from research. And these facts exist from different countries.

In the economic literature, according to Cook and Moore (2002) it has been documented from research that consumers tend to drink less alcohol and have fewer alcohol-related problems when beverage prices are increased or alcohol availability is restricted.

Consequently, higher tax rates on alcoholic beverages would be in the public interest. Cook and Moore clearly state that the direct evidence on the need for reducing consumption, not just of binge-drinkers but across the spectrum of drinkers was extensive and persuasive.

They said it was clear that alcoholic beverages obeyed the economists' dictum that price increases would lead to reduced consumption. This is in spite of plausible speculation to the effect that in response to price increases, alcoholics could preserve their habit by seeking cheaper sources, drinking off premises rather than in bars,  or buy illegal brews.

Contrary to the view that alcohol consumption is generally inelastic, there are studies that have shown that only 'beer' consumption did not change with adjustment made to prices whilst consumption of other types of alcohol such as spirits were price elastic.

We should not be fooled by those who twist facts or, should I say, those who have perfected the art of creativity of analysis of facts on alcohol. There is no solution to the health, economic, social, and moral challenges emanating from abuse of alcohol without a reduction in consumption. Evidence shows that harm arises from total consumption as well as from hazardous drinking patterns.  In fact, in many developed countries, policy activism has been pursued successfully resulting in declining consumption. Given this situation in developed countries, alcohol manufacturers have intensified their efforts to establish new markets in developing countries and among constituencies such as women and young people who have traditionally either abstained or drank less.

Teenagers and young adults

are a special case because they are more susceptible to binge-drinking as well as involvement in accidents and violence, whilst their drinking habits may become worse in later years, something that may affect their productivity at work and functionality in families. Heavy alcohol intake takes a particular toll on the young and has been linked to high rates of youthful criminal behaviour, injury and impaired ability to achieve educational qualifications. Certainly we cannot be a nation that seeks to move from top-ten in Africa to Top 5 by the year 2016 as that would contrast with the objectives of our national Vision.

To attract ever younger guzzlers, drink companies invest in promotions throughout the year and across the country, including using young barely-dressed female models to make alcohol consumption a 'cool' thing to do. Alcohol drinking and smoking, sometimes use of other recreational drugs, are fast-becoming entrenched signature behaviours typifying cosmopolitan, pleasurable and superfluous lifestyles. Alcohol cannot be treated as just another commodity whose consumption is determined by forces of supply and demand in a free market where consumers make their own choices regardless of the impact of such choices on themselves, on others and on the nation and its character.

An article on 'The Economics of Alcohol' by Lehto in 1997; it is observed that the arguments for consumption and high-risk use are convincing, but only to those for whom health is a first priority, thus unsupported by other stakeholders, including other public policy interests. Lehto goes on to identify the following economic arguments with regards to four aspects of an alcohol policy: (i) impact of reduced alcohol consumption on employment; (ii) increased alcohol taxation to serve both public health and financial interests; (iii) Payment for cost of alcohol-related problems ('polluter pays principle'); and (iv) cost effectiveness analysis in choosing between alcohol policy alternatives to support choices of decision-makers

The Government should mobilise all public sector and private sector stakeholders to ensure a systemic and strategic response to the menace of alcohol. But whatever the case may be, one thing is certain, the less the consumption the less the problems associated with alcohol abuse.

Although no empirical research on the subject in the Botswana context has been made, a local traditional leader is often quoted attributing to alcohol abuse, the declining rates of population growth emanating from a focus on alcohol consumption and away from reproduction in families. Of course there are medical studies that show that excessive alcohol consumption leads to impotence and infertility, so it is not without foundation for the Kgosi to caution drinkers to have time for their families and fulfill other obligations.

Alcohol abuse is one of the leading causes of death, disability and   social dysfunction - it poses serious health and social challenges including causing depression, injuries, cancer, cirrhosis, dependence, family disruption and loss of work productivity. While men do the bulk of drinking, women disproportionately suffer the consequences; including alcohol-related domestic violence and reduced family budgets.

The need for workplace responses to problems associated with alcohol have also been elevated due to the growing association between health and wellness on one hand and productivity, including higher standards of safety and wellbeing. Organisations in Botswana's economy must be encouraged to formulate health and total wellness strategies and include workplace alcoholism or employee assistance programmes.

Botswana is not the first country where those are in the business of alcohol have argued that  by educating for moderation, the nation will drink more, but have fewer people who binge and experience damage. It has also been acknowledged that such an argument is not sustainable and because conflict will inevitably persist, strategic interventions, including policy were required to tackle the challenge.

The most effective approach to reduce alcohol-related problems is to implement a comprehensive set of measures to reduce alcohol consumption and related problems. Public policy interventions include price increases, restrictions on availability, strong drink-driving laws and ready access to treatment.

Alcohol abuse has also been linked to poverty. Apart from the money, which is spent on drinks, heavy-drinkers often face other economic challenges, including lower wages, indebtedness, lost employment opportunities, increased medical expenses, decreased opportunities in education for children and decreased eligibility for development opportunities available at local level, poor nutrition and domestic violence.

Alcohol also contributes to risky sexual behaviours, injuries and accidents, petty crime, drug and tobacco use and lower productivity.

Finally, Botswana has not deviated from the global norm of democracies, which are strategically intervening to reduce alcohol-related problems through the following measures:

*Taxation and pricing
*Legislation and enforcement
*Drinking environment
*High risk groups
*Problem drinkers

We should be assertive as a nation and not be intimidated by capital. We can also learn from the credit-crunch that has gripped the world and the crisis on financial institutions that have led to the interventions of Governments in areas that many had thought were off-limits in free market economies. Because, alcohol is not just any other commodity, Government must intervene to protect the public good.

Activism and assertion should be adopted within clear democratic parameters where democracy is not just the end 'good' that the political leadership delivers, but should be both the end result as well as the means and the culture that is divorced from obsessive paternalism and depends on social, economic, scientific and medical facts to build compelling cases for change.

* Jowitt Mbongwe is a Chartered FCIPD human capital and strategy consultant, and a former journalist.




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