Our local MP is cheering recent news that cigarette smugglers will soon face mandatory minimum jail sentences and an additional 50 RCMP officers will be combatting smuggling operations. It’s consistent with this government’s penchant for law and order. Though it boggles the mind that, for years now, this same government has allowed many who were caught and fined to get away without paying up. That’s not something to cheer about.
Cigarette smuggling is a business and a fairly successful one, especially for those at the top. Consider that it costs little more than a dollar or two to manufacture a bag of 200 cigarettes and about 50 million of those are made in this area each year. Like any other successful enterprise, it quickly adapts to changes in the market, such as the relocation of Customs to this side of the bridge, or fewer weeks for running snowmobiles across the river in winter. So it will also adapt to changes in sentencing and a few more police poking around.
After all smuggling has existed for generations and will survive for many more. Years ago it was a hanging offence or it brought transportation for life to a penal colony far away, and yet, despite those penalties, it has persisted. One thing you can say about hanging, though – it really cut down on repeat offenders. By comparison, a few months or years in a modern jail is much less of a deterrent
Even if all the extra police officers were assigned to the Cornwall area, which apparently is not the plan, it wouldn’t wipe out cigarette smuggling anytime soon. Police are capturing, at best, a small percentage of illegal cigarettes and some front line troops. They’re attacking the tail of the snake.
But if they do lock more of them up, we can expect the cost to taxpayers will go up, whether you smoke or not. It costs us between $150 and $250 per day to keep each prisoner warm and fed in a jail cell. More prisoners means either higher taxes or more of our tax money diverted from education, health care or whatever. If family breadwinners are locked away, that can add to welfare lines. So, while it may sound good to lock ‘em up and throw away the key, there’s a cost. If more jails have to be built to contain them all, that cost will rise further.
What fuels this business is demand. As long as demand exists for low-cost cigarettes, somebody will find a way to make them available. Each new generation adds another layer of demand. That will persist as long as it’s cool to have a weed dangling out of your mouth, especially if you can’t buy them legally in local stores. And, for many young people, cool is still important. Of course, too many adults remain heavily addicted too and that just keeps the wheel turning.
Governments recognize they are getting a lot less money in excise taxes and are paying a lot more for policing, courts and incarceration. So it sounds like good financial sense to reduce excise taxes, which would cut into the smuggler’s operating margin and directly attack demand. But the sad fact is, cigarettes are the lesser of the evils. With well-established smuggling networks in place, if demand for cigarettes drops, that lost business will switch to drugs, guns or other products. So, lowering cigarette prices is unlikely. Instead, the government’s strategy is to storm the ramparts and fill our jails. That might work somewhat better than not collecting fines.