Putin’s Other War? Russians’ Binge Drinking

(Bloomberg – bloomberg.com – Peter R. Orszag – August 11, 2015)

Peter R. Orszag is a Bloomberg View columnist. Now vice chairman of corporate and investment banking and chairman of the financial strategy and solutions group at Citigroup, he was previously director of the Office of Management and Budget.

Russian President Vladimir Putin may be undermining global peace and civic rights, but he’s doing this much well: extending his compatriots’ lives. In 2013, Russian life expectancy at birth was 71 years, which is less than the worst state in the United States (Mississippi) and almost a decade below the developed-country average. That year, in typically imperious fashion, Putin ordered the government to raise life expectancy to 74 years by 2018. And while that goal may well not be reached, it is remarkable how much progress is being made in cutting back on alcohol use and smoking in Russia.

Alcohol consumption has been linked to a large share of deaths for those ages 15 to 54 in Russia — as much as half, according to one study. Tobacco use also contributes substantially to premature deaths, with the result that smoking and alcohol use combined accounted for an estimated 1 million Russian deaths a year.

In 2006, the government began a more aggressive effort to discourage smoking and drinking, including licensing and sales restrictions and higher taxes. Companies producing ethanol (a potent form of alcohol that some Russians drink) were required to pay a significant registration fee, track production on their premises, pay a higher excise tax, and in many cases to add substances to render the product undrinkable. And regional governments were allowed to restrict the hours during which hard alcohol could be sold. Although cheating undoubtedly occurs, the regulations seem to be having an effect.

The government also moved to curtail smoking. Advertising was banned, warning labels were imposed, and smoking was prohibited in public places and workplaces. In addition, the government raised taxes on tobacco and increased funding for prevention programs, including those aimed at discouraging children from beginning the habit.

The anecdotal signs of progress were clear during a recent trip to St. Petersburg. My wife, who emigrated from Moldova (part of the former Soviet Union), was shocked to see so few examples of the traditional Russian combination of heavy smoking and binge drinking.

I was curious to see whether these impressions were, in effect, a Potemkin village, but the data show substantial declines in alcohol and tobacco use among Russians. The share of Russian females who smoke daily declined from 15 percent in 2004 to 8 percent in 2014, according to data from the Organization for Economic Cooperation and Development. For men, the share declined from 61 percent to 41 percent — still much too high, but the trend is encouraging. These data, like any, are subject to various flaws, but the underlying downward trend is visible across a variety of sources, including from data on cigarette sales.

Average alcohol consumption has declined somewhat less dramatically, from an average of 12.3 liters per capita in 2007 to 11.2 in 2012, but that overall average misses an important change in the composition of what Russians drink. The amount of beer drunk per capita roughly doubled between 2000 and 2010, but the consumption of hard liquor fell by almost half during the same period. The available evidence suggests binge drinking, which causes particular harm, is down.

All of this is encouraging, but more clearly needs to be done. Evidence clearly shows that price matters in lowering smoking and drinking rates, and cigarettes are still relatively cheap in Russia — less than a third the cost, after taxes, than in the U. S. The pattern of sales restrictions on alcohol across different regions within Russia, furthermore, shows that areas that clamped down on the hours during which hard alcohol can be sold had bigger declines in consumption. That suggests regions that still have high alcohol consumption could reduce drinking further by following the example of their neighbors.

With aggressive increases in cigarette prices and further effort to discourage binge drinking, the goal in Putin’s decree may be met after all. And that in turn shows that even in a country with deeply ingrained habits, good policy can make a big difference.

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