How Drinking Costs the U.S. Economy

In addition to the human toll it takes, excessive alcohol consumption is helping to drain our country’s coffers and we’re all paying the price.

It would seem like full bars at happy hour would be a boon for the economy. Even at a discount, drinks are pricey, and we’ve been told frequently that if consumers are out spending, that’s a good thing for our country. While it’s true that excessive drinking is good for linking the pockets of those selling the liquor, it turns out it’s bad for our nation’s overall bottom line.

We’ve long been aware of the human impact of drinking too much. To see the personal cost of alcoholism, you only need to turn on the news or look to family and friends. You see heartbroken loved ones crying over the loss of life in drunk driving accidents and those struggling with or recovering from the devastating effects of alcoholism. The stats themselves are sobering. Excessive alcohol consumption causes premature death totaling an average of 79,000 deaths annually.¹

The Cost Beyond Human Lives

While the toll in human lives is, of course, the primary concern, there’s also a financial side that is rarely looked at. The incidence of increased disease and injury, property damage from fire and motor vehicle crashes, alcohol-related crime and lost productivity all add up. This new report issued by the Centers for Disease Control and Prevention and published in the American Journal of Preventive Medicine in 2011 shows that rates have risen substantially.

This new study, conducted between 2009 and 2010, set out to update prior national estimates of the economic costs of excessive drinking. To determine this, researchers followed U.S. Public Health Service Guidelines to assess the economic cost of excessive alcohol consumption in 2006. Costs for health care, productivity losses, and other effects (e.g., property damage) in 2006 were obtained from national databases. Alcohol-attributable fractions were obtained from multiple sources and used to assess the proportion of costs that could be attributed to excessive alcohol consumption.¹

On the Rise

What the study found was that excessive drinking cost the U.S. $249 billion in 2010, a significant increase from the $223.5 billion reported in 2006. Of those rising costs, $100 billion was paid by the government.²

Furthermore, binge drinking resulted in costs of $170.7 billion (76.4 percent of the total); underage drinking $24.6 billion; and drinking during pregnancy $5.2 billion. The cost of alcohol-attributable crime was $73.3 billion. The cost to government was $94.2 billion (42.1 percent of the total cost), which corresponds to about $0.80 per alcoholic drink consumed in 2006.¹

“The increase in the costs of excessive drinking from 2006 to 2010 is concerning, particularly given the severe economic recession that occurred during these years,” Dr. Robert Brewer, head of CDC’s Alcohol Program and one of the study’s authors, said in a statement.²

Paying the Price

So what’s your personal tab? Even teetotalers are on the hook for approximately $746 to cover the per capita cost of excessive alcohol consumption in the U.S.¹

Many may put the blame solely on those suffering from alcohol addiction, but look closely at the stats and you’ll notice that much of the costly drinking is chalked up to bingeing, which doesn’t necessitate the imbiber be an alcoholic. Teens and young twentysomethings who party regularly can binge drink to very dangerous – and costly – levels without meeting the criteria for alcoholism.

Drinking Definitions

In order to fully understand the issue, we must be able to grasp the terms being used. For the study’s purposes, binge drinking is defined as consuming five or more drinks on one occasion for men or four or more drinks for women. This type of drinking accounted for 77 percent of the costs cited in the study. Another growing issue is underage drinking, which was responsible for almost 10 percent of the costs. Shockingly, drinking while pregnant was also a factor, and it accounted for another 2.2 percent.²

Economic Solutions

So what can we do to cut the cost? In his book, Paying the Tab, Philip Cook analyzes the complex policy issues excessive drinking has created and calls for broadening our approach. Cook concedes that efforts to reduce the societal costs – such as curbing youth drinking and cracking down on drunk driving — have been somewhat effective, but that this approach is “woefully incomplete.”³

American policymakers have ignored the influence of the supply side of the equation, with beer and liquor are far cheaper and more readily available today than half a century ago. Cook uses research to demonstrate that higher alcohol excise taxes and other supply restrictions are effective and underutilized policy tools that can cut abuse while preserving the pleasures of moderate consumption.

If you or a loved one is struggling with an addiction and a co-occurring disorder, call us today. We’re available 24 hours a day, seven days a week and can provide information on treatment programs, help with insurance and answer questions about the treatment process.

Sources

• ¹ Economic Costs of Excessive Alcohol Consumption In the U.S.; American Journal of Preventive Medicine; 2011; Bouchery, E., Harwood, H., Sacks, J., Simon, C.J., Brewer, R.D., ncbi.nlm.nih.gov/pubmed/
• ² Excessive Drinking Is Draining America’s Economy; CBS News; October 16, 2015; Welch, Ashley; cbsnews.com/news/excessive-drinking-is-draining-americas-economy-cdc/
• ³ Paying the Tab: The Economics of Alcohol Policy; Princeton University Press; 2007; Cook, P.; press.princeton.edu/titles

Written by Wendy Lee Nentwig