Choices Have Consequences

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[00:00:11] Mike: Welcome everyone to Avoiding the Addiction Affliction , a series brought to you by the Kenosha County Substance Abuse Coalition. I'm Mike McGowan. You know over the past couple of years, we've all been coping in both healthy and unhealthy ways with the pandemic. My guest today, Mark Sommerhauser is Communications Director Policy Researcher for the Wisconsin Policy Forum.

[00:00:34] Today, we're going to have a conversation about the role alcohol has played in that coping. Welcome Mark.

[00:00:40] Mark: Well, thank you for having me, Mike. I appreciate being able to join you.

[00:00:44] Mike: Well, I came across your research, but before we talk about that and the subject matter, could you tell us a little bit about what the Wisconsin Policy Forum is and what you all do?

[00:00:53] Mark: Yeah, absolutely. So the Wisconsin policy forum, we are a non-partisan independent statewide, uh, public policy research organization. So we do research and analysis typically through reports that we issue periodically, uh, of, of. You know, public policy issues, specifically they're affecting state and local governments here in Wisconsin, as well as our education system here in Wisconsin.

[00:01:20] Uh, we are, you know, as I had mentioned independent non-partisan most of the funding that supports the research that we do comes from hundreds of dues paying members that we have here in Wisconsin, some, and they're a pretty diverse group. I mean, corporations, local governments. School districts, other nonprofits, and some individuals who do support our work.

[00:01:43] So, um, that's kind of the quick rundown on the forum

[00:01:47] Mike: Well you and I were chatting before we started recording this, and you were telling me that I'm going to ask you about your alcohol consumption study, but you said that wasn't even the intent of starting it at first?

[00:01:59] Mark: No, I mean, as I had mentioned, so we, you know, our focus is on public policy.

[00:02:03] We, we do a lot of stuff around. Um, state and local government finances, uh, some things on around education, some things also around like economic development and workforce issues. So substance abuse is not right in the wheelhouse of stuff that we would typically be looking to research, but we do do some research that delves into healthcare, social services, some of those issues as well, because those are obviously important functions that government does have a role in.

[00:02:30] And as we started to look through data. And we obviously were mindful as the pandemic unfolded that we were looking for impacts from the pandemic. We kind of just kept bumping into these data that showed some, some increases in alcohol sales alcohol-related deaths, where we almost were having to double check these numbers because the increases were so concerning and so striking.

[00:02:54] Uh, and it just sort of made us feel like, you know what? We have these numbers, we have the ability to do. You know, something that, that does bring them to light. We felt like we ought to do it. So that's, that's what we did.

[00:03:05] Mike: Yeah. And I'll try not to sound too, uh, overly cynical when I ask the questions, because those of us who work around this are not surprised that you kept bumping into it, you know?

[00:03:15] So, so then you went ahead and did a, a, a study on alcohol consumption during the pandemic. What did y'all find?

[00:03:24] Mark: Yeah. So there's two, I would say there's two main reports that we put out that I would highlight here. Um, that kind of looked at this. The first one that we did, uh, was, um, kind of like fall of last year and that looked at alcohol tax revenues.

[00:03:38] Um, in Wisconsin, alcohol tax revenues actually are a pretty good way to, to measure consumption because the way we tax alcohol in the state of Wisconsin, it's not like the sales tax where it's a percentage of what somebody pays for a product it's it's per gallon.

[00:03:54] Mike: Right.

[00:03:54] Mark: So, you know, the, the, the revenues don't go up and down and say with the price of beer or whatever, if that goes up and down the revenues go up and down, depending on how much people are buying the volume of alcoholic beverages that people are buying.

[00:04:08] So it, it can be something, obviously that gives you a little bit of a window into, into consumption. And we did find that in the 2021 state fiscal year. So that was the 12 months going from July of 2020 through June of 2021. Uh, we did see an increase in state alcohol tax revenues of 17%. You know, that was, that was the largest annual increase we'd seen in about 50 years.

[00:04:33] Uh, the last time we had seen an increase of that magnitude was at 1972, and that was, uh, it should be noted a year when they both increase the tax rate for alcoholic beverages and the legal drinking age was lowered from 21 to 18 the year before that. So not exactly an apples to apples comparison there, we, of course had neither of those things happened in the last two years.

[00:04:57] So it's really not even a fair comparison. I don't think with that year. When you look at those tax revenues, they tend to be pretty stable. I mean, they move around a little bit, to see a 17% increase just in one year is pretty much off the charts.

[00:05:12] Mike: That sounds just incredibly huge.

[00:05:15] Mark: Yeah. It, it, it's just totally, as I said, I mean the only, uh, analogy can come up with is 50 years ago in a year when you had higher tax rates, which obviously increased the amount of revenue that was taken it as well.

[00:05:27] Uh, the, the drinking age was lower there for a period of time. So, um, you know, so that was pretty remarkable. I think we had anticipated that we might see an increase. Now. We, what is very much within our wheelhouse at the forum is we do keep an eye on a lot of these different areas of state and local tax revenues.

[00:05:44] That's something we do check that data periodically. And so this was one where we thought, okay, you know, the pandemic, a lot of people isolated, a lot of people. Um, stressed out, obviously because of the pandemic, we kind of wondered if there might be an increase, we didn't anticipate one of this magnitude.

[00:06:02] And so this first report was kind of part of what led us to look at some of the mortality data that was in the second report. If you want me to talk about that one.

[00:06:11] Mike: Yeah. And just a second, but when you talk about 17% increase and, uh, just please feel free to correct me if I make a misstatement. During the time period you're talking about, there were a lot of establishments that were either closed, reduced, or limiting occupancy, so that increase would seem to infer a huge increase in at home drinking or buying from store.

[00:06:37] Mark: I think that's a reasonable inference. I mean, we, there's no way with the data that we can prove that just because in some states, some states tax alcohol sales differently on-premise versus off-premise. Wisconsin doesn't do that. Our alcohol taxes the same no matter whether you're buying it in a liquor store to take it home or at a bar or a restaurant. So we, there's no way that we can look at the data and say one went up and the other one down or anything like that. But, um, yeah, it's just, uh, it certainly is true that for a lot of this period, especially in 2020, you had bars and restaurants that were either close or only at partial capacity.

[00:07:11] Certainly there were some people I think, who probably just didn't feel comfortable going to bars and restaurants, especially in 2020 and would have just regardless of whatever restrictions that were, or were not in place in their area. They probably just would not have done it. Um, so I think it's reasonable to probably infer that, you know, uh, a big part of what was driving this was probably at home consumption or at least in private residence is not, not in bars and restaurants.

[00:07:36] Mike: That pretty much correlates with the CDC study that showed that all 72 counties in Wisconsin reported an increase in excessive drinking during that same time period.

[00:07:47] Mark: Yeah.

[00:07:48] Mike: That also means that kids are watching their parents drink more.

[00:07:52] Mark: It certainly could mean that. Yeah. In a lot of cases I'm sure did.

[00:07:55] Mike: Well, you said you also did some work on mortality?

[00:08:00] Mark: Yeah. So when we, when we did this first report, I was like, okay. You know, there seems to be something happening here. So we, we had some familiarity with the CDC. Uh, wonder database, which is a huge national database that keeps all these records from death certificates that are filed in every state in the country.

[00:08:21] And these death certificates have a lot of information about the cause of death, demographic information about the deceased and all these things that make this database very useful for understanding mortality trends nationally in states and localities throughout the country. So we had worked a database a little bit. We had some faculty where that we decided, okay. Let's, let's just take a look at kind of what, uh, what has been happening here in Wisconsin with alcohol induced deaths. Right now, the final data in that database is only available through 2020. They do have some provisional data up and I, I'm not sure exactly when that's going to be finalized for 2021, but we looked at the data through 2020.

[00:09:03] And what we did find was, an increase of about 25% in alcohol induced deaths and Wisconsin in 2020, that's again, just a one year, year over year increase. Um, that was the biggest one year increased in several decades. That's one where, you know, I do want to stress. That's not just a Wisconsin thing.

[00:09:19] It is part of a national trend. And actually the percentage increase that we saw in Wisconsin was pretty close to being inline with the national trend. So this was something that was playing out nationally, but Wisconsin's rate of these types of deaths does exceed the national rate.

[00:09:37] And if we look back a little further in time over the past decade or so. Our rate of alcohol induced deaths has increased more rapidly over the last decade than the national rate. So certainly the one-year problem was national, but there is kind of a broader picture here where you can see that we, we seem to have some more issues with this here in Wisconsin versus the nation.

[00:10:04] Mike: What is alcohol induced deaths encompass?

[00:10:07] Mark: Yes. So that's a good question. And it, the quick answers that it really is a very narrow definition. There are clearly a lot of deaths in which alcohol would have played a role or been a factor that are excluded from these deaths. These are essentially only deaths that can really be very directly and narrowly attributed to alcohol use.

[00:10:30] So they include things like liver diseases. Certain neurological diseases, alcohol poisoning, uh, would, would fall into that category. What it does not include crucially is a lot of these other things like motor vehicle accidents, falls, violence, any of these types of things that can lead to death, that where alcohol may have played a partial or a very prominent role, that just because of the definition that the CDC has, are not included in this group.

[00:11:00] Um, so, so it's only things like alcohol poison or liver disease where you can draw a very straight line between the person's alcohol use and the death.

[00:11:09] Mike: Well, you know, that makes sense. My dad had a problem and died of an aortic aneurysm, but the surgeon who was operating on him when he died, said it was a direct cause of his lifelong drinking problem.

[00:11:23] However, the death certificate didn't mention that. So it just mentioned aneurysm. So that would be excluded from the data. So it's probably higher, I would think.

[00:11:34] Mark: Yeah. I'm sorry about your dad by the way, but yeah, that's a great point, which is that? Yeah. There's all these other, um, you know, what deaths, or certainly just health issues that maybe don't don't cause somebody to die, but can really meaningfully impact quality of life for that individual and for people around them.

[00:11:54] That can, that can stem from alcohol use and especially alcohol abuse that are not going to be captured in a lot of these data sets. And so, yeah, that's certainly something we noted in our report that we're only really getting a glimpse at one kind of small subset of the universe of impacts from this.

[00:12:12] Mike: You also mentioned automobile fatalities. You, you did do a dive into that a little bit. Did you not?

[00:12:19] Mark: A little bit. Yeah. Now that one is we did something earlier on this would have been, let's see, December of 2020, we did do something where we look at auto fatalities, like very early in the pandemic that time we only had data through, I believe July of 2020.

[00:12:35] And so we did see an uptick just in the very early months of the pandemic in alcohol-related, um, vehicle crashes. We have not revisited that data and we really should go back and take a look at that data again, because we would have obviously now much more up-to-date data. We were doing most of this work, like in the fall of 2020.

[00:12:55] So I'm not sure. How up-to-date the data would be, but I would imagine now we could get data for a good chunk of 2021. And maybe we, uh, we'll go back and revisit that at some point, but just in the first few months of the pandemic, March, April, May, June, July, we did see, we did see an increase in, in an alcohol-related car crash fatalities.

[00:13:17] Mike: Well, that seems almost paradoxical, doesn't it? Because that's also a time period where everybody was staying at home.

[00:13:25] Mark: I know.

[00:13:26] Mike: AAA would measure that miles driven would be significantly less.

[00:13:32] Mark: Right. Yeah. And it's, it is odd because we did see in 2020 and 2021, uh, a sort of surprising increase in a lot of reckless driving behaviors driving under the influence was one, speeding.

[00:13:48] There was a large increase in crash fatalities related to speeding. Um, and you can find a lot about this if you just Google it. I mean, I know the national DOT has been doing, putting out a lot of communications on it, but there is, it seems like somewhat of an epidemic in reckless driving of which alcohol. Driving under the influence is part, but some of these other behaviors as well. And it's not very well understood. I don't think what has been causing this uptick. Uh, because as you said, I mean, if anything you would think, uh, you know, you would, you would probably think that there would be less of that with less people driving less.

[00:14:21] Uh, there's less congestion on the roads, especially in 2020. Um, and yet we're seeing more of those types of behaviors.

[00:14:29] Mike: You know, I want to circle back to the economics for a second. What is the tax on beer?

[00:14:36] Mark: Uh, yeah, let me pull that up here .

[00:14:38] Mike: And we're also, where do we rank when it comes to other states and, uh, in, in generating?

[00:14:46] Mark: So in Wisconsin, again, our excise taxes, and this is pretty common. Most states are like this, there are a few exceptions, but most states do an excise tax where they tax, um, per gallon of alcohol sales, as opposed to, um, you know, the normal sales tax that we pay on most items is based on the price of whatever we're buying.

[00:15:07] The alcohol excise tax. Again is not like that. Beer in Wisconsin is taxed at six and a half cents per gallon. A wine is so there are separate rates for beer, wine, and liquor. Beer, six and a half cents a gallon. Wine is 25 cents a gallon, and liquor,

[00:15:25] Mike: Well, while you find that, that for the math, 120, uh, what, eight ounces to the gallon. So that's about a half a cent of a beer.

[00:15:35] Mark: Yes. So, so the liquor tax, I knew it was much higher than liquor tax is $3.25 per gallon. Um, so, so pretty big difference there. Still though, if you look at where we rank among the states, um, this is one of the facets of our tax structure here in Wisconsin that is unique. Uh, we have very, very low rates for alcohol taxes, especially for beer. We are 48 among the 50 states. Uh, our wine tax rate is 43rd. Uh, and our liquor tax rate is 41st. So we are in the bottom 10, uh, in all those areas and it is perhaps worth noting that two of the other states, uh, the tax foundation is a good national source for these data.

[00:16:20] Two of the other states that have some also have some of the lowest beer tax rates are Missouri and Colorado, which as you know, share a tradition with Wisconsin as big beer brewing. Anheuser-Busch in St. Louis and Coors in the Denver area, uh, you know, being big beer producing, uh, areas. So perhaps not a coincidence there.

[00:16:41] Mike: Well, and I think I'm right. We haven't, uh, uh, not that I'm advocating any increase in taxes. However, uh, I don't think we've raised the beer tax in Wisconsin since, uh, 1969, which is before even that latest, you know, the 1972 data, you said that's a long time.

[00:17:01] Mark: That is, that is certainly a long time. And you know, there is, um, this always a hot topic. And there are obviously are always some differing views on this, but, uh, you know, there is a fair sized body of research out there that does suggest that higher taxes on alcohol can reduce consumption overall. Now, of course, when you look, when you break that out by income, the impact, I think it, as memory serves is not always equal across income strata.

[00:17:31] So people of higher incomes. May not be as impacted. You know what I'm saying? If you increase the beer tax by 5 cents or 10 cents, that's not necessarily going to deter somebody who's got a lot of money in their pocket, for somebody a lower income who is, has a tighter household budget. It might be more of a factor.

[00:17:50] Um, you know, there is also some research which I think will always be brought up among the opponents of increased alcohol taxes that. You know, it is somewhat regressive form of taxation. Like all sales taxes, since everybody's paying the same, it's not like the income tax or something that is a progressively structured tax.

[00:18:11] It does hit lower income harder. Uh, but you know, then again, you have to kind of balance that with, um, you know, reducing consumption, which obviously has some benefits. Um, for throughout a population in terms of health benefits,

[00:18:27] Mike: That's exactly what I was thinking when I asked a question, which is, you know, if you, if you collect more revenue, um, cause you're also saying with the consumption, going up a healthcare cost at the very least.

[00:18:40] Uh, let alone some of the societal costs. We have therapists that are, are just incredibly busy. You can't get in. Um, and all, all of the other things, not that. So some of that money could be diverted towards education prevention programs.

[00:18:58] Mark: Yeah, it's, it's always a hot topic because, uh, you know, you have some of the issues that I mentioned.

[00:19:04] Um, but it's, you know, it's always a political hot button. And so, you know, it can be difficult to get policymakers and lawmakers enthused about the idea of raising alcohol and taxes. Um, but you know, certainly Wisconsin is somewhat of an outlier nationally. And in how we tax alcohol.

[00:19:26] Mike: Well, did you break any of the other demographic information out as to who is buying?

[00:19:32] Mark: So that's not really available from the tax revenue data that we have. Um, as I said, some states have like a different rate on-premise versus off-premise, but here in Wisconsin, we, we don't really have anything like that.

[00:19:45] So, we can look at the one thing we can break it down, uh, according to which might be of interest is just. As I mentioned, you do have the different rates for beer, wine, and liquor. So we, we do have kind of a little bit of some different trends going on there.

[00:20:02] Mike: Yeah, I was, I was just going to ask you that if it went up more for beer, went up more for liquor?

[00:20:07] Mark: That's right. So it did go up the most for liquor.

[00:20:11] Mike: Huh.

[00:20:12] Mark: These are data that actually look at instead of tax revenues, the department of revenue keeps the data on tax revenues, but they also keep a related data set for just sales of gallons of alcohol by different types.

[00:20:25] Uh, in fiscal year 2021, we saw basically double digit percentage increases in sales by gallon of alcohol in every category. But liquor was the greatest, per gallon sales were up 18%. Beer was up 10%, wine was up 10%. Um, so, so that is, I think that is notable as well. And, um, I think we looked a little bit at some of the long-term trends as well, just over the last decade.

[00:20:55] And it does seem also that long term we are seeing a larger sustained increase in liquor sales compared to beer and wine.

[00:21:05] Mike: Does it, does it show how many total gallons we consumed?

[00:21:11] Mark: I think we have that data somewhere. I don't have it right in front of me, so I would need to pull that from one of our databases.

[00:21:18] Mike: Because we do have, we have, I think we lead the country or we're in the top three and the percentage of adults who drink.

[00:21:24] And people don't even know this, Mark, that about a third of the population who able to drink because of the age limits, don't drink. They just don't drink.

[00:21:33] Mark: Yeah.

[00:21:34] Mike: So, we're talking about is all of this consumption is from the people who drank. And there are other studies that show that the most of that consumption is from the top 10% who drink the most.

[00:21:49] Mark: I've seen some of that data as well, that it is pretty striking. When you look at how consumption is distributed across the population, because as you mentioned, you have a sizeable share that doesn't drink you a sizeable share that drinks, but only very occasionally. And then you do have quite a concentration among, as you said, a pretty small subset of the population that is consuming the most, that accounts for a really disproportionate share.

[00:22:15] Mike: So where do you all at the policy forum go from here? I mean, since you, you kept bumping into this, do you have plans to look back at it as we go forward?

[00:22:24] Mark: So I think certainly in the mortality data, we're gonna check on that. Um, as, as we get into a place where we have the finalized 2021 data, and my concern there is, I'm not super optimistic about how that's going to look in 2021. Um, we know that the types of deaths, so, you know, the vast majority of deaths that are in that batch that we were talking about are things like liver disease. And there are things that really accrue as a result of usually of years of alcohol abuse, uh, a sustained pattern over time.

[00:23:01] Alcohol poisoning is included in that group. And that can obviously just be a one-off situation where somebody drinks way, way too much in one sitting, but that's a pretty small share of the overall deaths. The vast majority of them are, again, things like liver disease, neurological issues. And so I think our thinking is that if we saw the kind of increase that we saw during the pandemic in 2020, It seems likely that that's something that's probably going to continue or maybe even get a little worse in 2021, but hopefully that won't be the case, but we'll, um, I think we'll definitely be keeping an eye on that.

[00:23:33] Um, we, we probably will go back and just keep tabs also on the tax revenue and then the crash fatality data is one that, uh, you know, I think we, uh, we really probably ought to revisit here at some point and, and just kind of see what, what, what that's doing and we'll be on the lookout for other. You know, it's for us, it's always about finding, finding data, finding a source of data that we can kind of delve into.

[00:23:57] And then, um, we kind of work from that in terms of what kind of a narrative we can, we can tell in our reports. But, um, you know, again, the there's just, uh, uh, there's no shortage of, of kind of red flags here of what what's going on. And, um, you know, we've had a lot of people ask us the why, well, we're not the best qualified to answer the why question.

[00:24:19] We usually encourage people to talk to people who have expertise in substance abuse who have a background in that discipline that we really don't have we're public policy researchers. And we're, you know, we're used to kind of crunching the data, but, um, you know, to some extent, I think some of what is happening is somewhat intuitive.

[00:24:39] I mean, I mean, amid a period of society-wide isolation and a ton of stress, um, You know, there are aspects of this that are probably somewhat intuitive.

[00:24:51] Mike: Sure.

[00:24:52] Mark: To people that, that people are consuming more alcohol. But, um, obviously to the extent that it's resulting in some of these issues that we're, we're looking at in some of these reports, that's, that's where it really becomes a concern.

[00:25:05] Mike: Well, and what a nice thing for you to do to give me that segue, because the, why is part of what we'll be looking at here as the months go on, but having your data helps frame it and gives us information for that. You know, I know, um, uh, I really appreciate you spending time with us today and opening so many of these doors and other questions we can ask.

[00:25:26] Uh, for the listener, you know, if you keep tuning in, we're going to talk more about issues around substance use. Mark, thank you so much for joining us. And I think the closing is ever so appropriate today. We're going to give links to the policy forums data at the bottom of this podcast, but we look forward to sharing the air with you next time and until then stay safe.

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