I frequently get asked why things work the way they do. For example, what is going on with the grocery stores and the MTA wanting to take away the health insurance of their employees? One of the reasons is the law of unintended consequences. The way in which it works is this: You try to fix problem A, and in finding a cure, you create problem B.
Our society is growing at both ends of the spectrum — there are more children being born and surviving due to the advances in neo-natal health care. On the other end of the spectrum, people are living longer, thanks to the advances in medicine and disease prevention.
This is both a good thing and a problem. It is good because for those of us who are already alive, we usually want to stay that way. It is a problem because it now takes more resources to keep us alive. As a society, we need to have more hospitals, doctors, nurses, drug companies, convalescent care facilities, and researchers finding ways to prevent and cure the illnesses.
This creates an economic problem because we need to fund the education requirements for those individuals, and we need to fund the construction of hospitals and research centers.
That is why smokers are good for society. The smoker is a much maligned part of society. I know, I was one. The smoker is considered socially irresponsible. The public service advertisements are quick to point out that when one person is smoking, all those around him are affected. He has more of a chance of developing lung cancer, emphysema, heart disease and is at an increased risk of heart attack.
In those very dramatic PSA’s the antismoking faction points out how dirty and ugly, how stinky and gross, how inconsiderate and selfish the smoker is. Smokers are painted as littering, fire starting, nicotine crazed addicts who are nothing but a drain on society.
Which is partially true. What gets lost in the frothy blather of condemnation is the fact that smokers pay a huge amount of taxes. Taxes that go for things like hospitals, research grants and infrastructure. Taxes that are used to pay for Medi-Cal, to support the state general fund and to provide many of the services that are in trouble.
A pack of cigarettes costs between $4 and $5. The actual product cost is about $1.50, the balance is taxes. So if I was still a smoker I would be contributing between $2.50 to $3.50 per pack in taxes, and at two packs a day, that’s $5 to $7 a day in taxes. In one year, it was between $1,825 and $2,555 in extra taxes I was paying. Over the course of a 50-year smoking career, I would likely contribute over $130,000 extra to the running of the government. And most importantly, I was likely to die quickly of a heart attack with low medical costs.
The societal efforts to reduce the numbers of smokers has paid off. I am now a non-smoker. But as Sir Isaac Newton said, for every action, there is an equal and opposite reaction.
I have quit smoking, which means that I will likely live longer. But more importantly, I am not going to be contributing all those taxes to the general fund. Now the counter argument that is frequently trotted out is that I will live longer, be a more productive member of society and pay more taxes in increased income. Not very likely. I am already paying at a high rate for taxes and it is very unlikely that my income earning capacity would be changed by my smoking or non-smoking.
What is more likely is that I will now live longer, retire and live a few more decades off of passive income, paying little or no income taxes. With the wonders of modern science I will be kept alive longer, and contribute less to society from an economic standpoint. This is not to say that I won’t contribute in other valuable ways, but fiscally, I should be considered a drain on society at that stage.
And that same thing goes for all of our other bad habits. In reducing the number of things that will kill us, we increase the population and the need for government infrastructure. As we are better able to control diabetes, AIDS and cure cancer, we end up with more people who are likely to get other, more expensive diseases to fight. As we cure more and more of the natural killers, we are creating the economic problems that are surfacing today.
Right now the grocery clerks and the MTA are on strike because they want to keep their health benefits. Their respective employers are trying to contain costs for insurance to assure that at least some level of health insurance is in place. The employees are only seeing the potential loss of a benefit. They are not looking at the increased costs due to advances in health care.
It is wonderful that today we can do an MRI and find the cancer in someone’s body, and that a surgeon has the tools, and the skills to remove the cancer and then put the patient on a regimen of chemotherapy to prevent a recurrence. But it is very costly to save that life.
Before, that patient would have paid health insurance premiums for years, and then died quickly of undiagnosed cancer. From an economic standpoint, that is an asset. It is one of the many factors that are involved in keeping premiums low. But the more problems we can treat also means more costly treatments, therefore, the premiums must go up.
The unintended consequence of more capable doctors is that they spend more on treatment to cure the previously incurable. It costs more to run society and it costs more to run an insurance program. Smokers for years contributed vast amounts to the costs in the form of taxes. But now that the number of smokers has gone down, the income to the state has decreased, thus creating a shortfall. Smokers are great contributors but die before the services they have paid for can be used. Economically, that’s a good thing.
As medical research prevents or cures more diseases, the cost of treatment goes up. Before there might have been no cost to treat a man with prostate cancer because he just died before it was discovered. Now it is discovered early, and the cost for surgery and post surgery treatment is passed on to the other members of his health care plan in the form of premium increases.
It’s just an unintended consequence of the progress that we have made in medicine. (David Pisarra is a partner in the Santa Monica law firm of Pisarra & Grist, He welcomes questions and (310) 664-9969 or e-mail to)
Originally published in the Santa Monica Daily Press print edition on October 21, 2003. Read the original PDF.