Increased taxation of tobacco and liquor to raise prices would discourage alcohol abuse and cigarette smoking, states Michael Grossman, a City University of New York economist. In a research paper for the National Bureau of Economic Research, he finds that raising the federal excise tax on beer to catch up with inflation over the last three decades would cut motor vehicle fatalities of 18 to 20 year olds by 15 percent, saving more than 1,000 lives a year.

If the federal excise tax on cigarettes was restored to its real value in 1951, more than 800,000 premature deaths would be averted, he holds.

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