Helping convenience stores by encouraging smoking?

Photo: Flikr Creative Commons "Tobacco users get tax break from Legislature," reads the headline in today's StarTribune.  The tax break in question involves the cigarette tax.  In 2013, the legislature and governor approved three years of annual increases in the tax, with an inflation adjustment built in to maintain the real value of the tax.  The tax bill includes a provision to eliminate the … [Read more...]

Externalities and long lines at airports

Photo: Flikr Creative Commons Yesterday I published a piece in MinnPost, "Why you shouldn’t feel too grateful to Delta for hiring people to help with the TSA security-line crunch."  The takeaway: airlines are creating a negative externality by charging high fees for checked baggage. A better solution to long lines at the airport would be to adjust the relative price of checking a bag versus … [Read more...]

Why Governor Dayton should veto the spending and tax bills

Source: Flikr Creative Commons Session implodes at midnight over roads and public works That headline pretty much sums up the legislative session in general from an economics perspective. The Legislature made no progress on long-run issues such as infrastructure spending and pre-K education and probably worsened the medium-term budget outlook. I am especially disturbed by the tax and spending … [Read more...]