Saturday, April 6, 2013

Stupidity Taxes

I was looking through some partially written posts and came across this one from 2011:

It's easy to think that state-run gambling is, in effect, a stupidity tax. But it's probably more fair to call it a hopelessness tax, or an unfair taking advantage of the way our human brains are wired (see Jonah Lehrer's How We Decide).

I will never have to pay this particular tax because -- I really do believe I can say for sure -- I will never gamble. But having the state create opportunities for people to waste their money this way, so that it can siphon off most of it, seems quite different from another tax I'll never pay -- the cigarette tax.

In that case, cigarettes already existed and the state placed a tax on them, in part to decrease the number of sales by raising the price. The equivalent with gambling would be if the state taxed existing gambling, thus raising its price. Not sure what I think of that exactly, but I prefer it to the state opening its own casinos, racinos, or numbers games.


Now here we are in 2013, and Minnesota has committed to pay for a new Vikings stadium by allowing a brand-new gambling technology, electronic pull-tabs. But the revenue projections are coming in very short, like under 10 percent. Oops.

I hope this highlights the stupidity-tax nature of gambling for those who don't usually see it. No one wants to play these "games," and as a result the rest of us are going to have to make up the difference.

Unless the state can manage to stay strong in negotiations and insist that the Vikings come up with the missing revenue from a seat tax on the people who directly benefit from the team's presence.

Now there's a more appropriate example of a stupidity tax.

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