Copyright © 2014 by the Cato Institute.
All rights reserved.
Library of Congress Cataloging-in-Publication Data
Hall, Thomas E. (Thomas Emerson), 1954-
Aftermath : the unintended consequences of public policies / Thomas E. Hall.
pages cm
Includes bibliographical references.
ISBN 978-1-939709-38-7 (hardback : alk. paper) 1. Policy sciences—United States—Case studies. 2. Political planning—United States—Case studies. 3. Income tax—United States. 4. Cigarettes—Taxation—United States. 5. Minimum wage—United States. 6. Prohibition—United States. I. Title.
JK468.P64H36 2014
320.60973--dc23
Ebook ISBN: 978-1-939709-39-4
2014017681
Printed in the United States of America.
Cover design: Jon Meyers
CATO INSTITUTE
1000 Massachusetts Ave., N.W.
Washington, D.C. 20001
To the memory of my brother Jim
Contents
2. Federal Income Taxes: Funding the Welfare State
3. Cigarettes: Creating Crime through Taxes
4. The Minimum Wage: Promoting Teenage Unemployment
5. The Fruits of Alcohol Prohibition: Poison Booze, Crime, and Corruption
6. Be Careful What You Wish For
Figures
2.1 Top and Bottom Federal Marginal Tax Rates on Income, 1913–2011
2.2 Federal Receipts, Spending, and Budget Surplus, 1929–1940
2.3 Federal Government Outlays Including and Excluding Transfer Payments, Nominal Values, 1929–2009
2.5 Social Security and Medicare Tax Rates, 1937–2010
4.1 Difference between Unemployment Rates for White Males Ages 16 and 45–54, 1948–1974
4.2 Difference between Unemployment Rates for Black Males Ages 16 and 45–54, 1948—1974
4.4 Inflation-Adjusted Federal Hourly Minimum Wage, 1938–2010
5.1 U.S. Pure Alcohol Consumption, 1900–1929
5.2 Arrests for Drunkenness per 10,000 Population in 383 U.S. Cities, 1910–1929
5.3 U.S. Homicide Rate per 100,000 Population, 1910–1944
Tables
2.1 Federal Employment in Selected Years, 1929–1964
2.2 Federal Receipts and Outlays as a Percentage of Gross Domestic Product, 2007 and 2010
3.1 Cigarette Taxes and Tax Revenue, Alternative Scenarios
3.2 Cigarette Tax Rates in Selected States, 1990 and 2011
4.1 Employment and Wages, 1938–1950
4.2 Average Union Wage Rates (Hourly), 1955–1956
This book describes four case studies of the law of unintended consequences as it applies to government policy. The well-known result that government
