IEA Podcast

In this Institute of Economic Affairs podcast, IEA Head of Lifestyle Economics Dr Christopher Snowdon speaks with Rohan Pike, a former Australian Federal Police officer and ex-Australian Border Force official who spent his final years in public service working on illicit tobacco. The conversation looks at the Laffer Curve as a real world example, using Australia’s tobacco duty, where revenue has fallen from $16 billion to $4 billion even as tax rates climbed. They discuss how taxation pushed past the point where higher rates raise less money, and what that means for smokers, the public purse and crime.Pike sets out how the illicit market has grown to around 80% of all tobacco sold in Australia, with the illicit vape market above 95%. He explains how tax of roughly $1.53 per cigarette, about £17 a packet before sales tax, opened a gap that organised crime moved to fill, with black market packets selling for a fraction of the legal price. The discussion covers the violence that has followed, including murders and hundreds of fire bombings, the rise of a multi-billion dollar criminal syndicate, and why enforcement at the border can only ever stop a small share of what comes through.The second half turns to Britain. Snowdon and Pike argue that the UK is only a few years behind Australia, pointing to high tobacco duty, the tax escalator, the planned vape tax and official figures that they say understate the size of the illicit trade. Pike argues that the answer is not tougher enforcement alone but lower excise, consistent enforcement and an honest approach to harm reduction, contrasting Australia’s stance on vaping with the position taken in the UK and New Zealand. He closes with a warning for the Treasury and for ministers that the same path leads to the same result.The Institute of Economic Affairs is a registered educational charity. It does not endorse or give support for any political party in the UK or elsewhere. Our mission is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.The views represented here are those of the speakers alone, not those of the Institute, its Managing Trustees, Academic Advisory Council members or senior staff. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit insider.iea.org.uk/subscribe

In this Institute of Economic Affairs briefing, IEA Director of Communications Callum Price speaks with Dr Christopher Snowdon, the IEA’s Head of Lifestyle Economics, about his new book Inside the Sausage Factory: The Illusion of Evidence-Based Policy Making. The conversation looks at four public health measures from the 2010s, plain packaging for tobacco, minimum pricing for alcohol, the sugary drinks tax and the crackdown on fixed-odds betting terminals, and asks whether the evidence used to justify them actually held up.Snowdon explains that each policy tended to rest on a similar package of evidence: modelling showing how the measure would work in theory, an example from another country that had tried something similar, and an expert review that gave it a stamp of approval. He argues that much of this evidence was weak or asked the wrong question. Plain packs were obviously less attractive, but that did not mean people would give up smoking. Modelling predicted large falls in alcohol deaths and in obesity that never materialised once minimum pricing and the sugar tax came in. In his view the evidence was rarely what decided the outcome.The second half turns to what really drove these policies through. Snowdon makes the case that pressure, not evidence, was the deciding factor, with professional and often state-funded campaign groups generating media coverage while almost nobody organised against the measures. He draws on public choice theory to explain why millions of affected consumers stayed silent, why politicians took the path of least resistance, and why ministers from George Osborne to Rishi Sunak reached for these policies to build a legacy or shift the headlines. He closes on the recent move by the Government to restrict social media for under-sixteens, argues that opinion polls are a poor basis for lawmaking, and suggests defunding state-backed pressure groups as a place to start.The Institute of Economic Affairs is a registered educational charity. It does not endorse or give support for any political party in the UK or elsewhere. Our mission is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.The views represented here are those of the speakers alone, not those of the Institute, its Managing Trustees, Academic Advisory Council members or senior staff. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit insider.iea.org.uk/subscribe

In this Institute of Economic Affairs podcast, host Callum Price is joined by Editorial Director Kristian Niemietz and Senior Economist Dr Valentin Boboc. The episode examines the political turmoil in Westminster, the Government’s King’s Speech, and what both mean for the UK economy. The discussion centres on the bond market, fiscal credibility, and why political chaos matters far more when public debt is already stretched.Dr Boboc and Kristian Niemietz dig into the UK’s deteriorating fiscal position, with around 8% of all public spending now going on debt interest alone. They assess why bond markets are nervous about whoever ends up leading the Government, arguing that the real problem is not the chaos itself but the absence of any credible plan on spending, growth, or taxation. The King’s Speech is assessed in detail, including the Government’s “Regulating for Growth” bill, the nationalisation of British Steel, and what Kristian describes as Chris Snowdon’s “capitalist command economy” thesis: a state that does not want to own industry directly but increasingly dictates what private companies produce and how.The conversation closes with a look at a Labour backbench growth paper that Kristian describes as the closest thing to a centre-left supply-side agenda he has read in the British context. He and Dr Boboc explore why rationing key inputs like land, energy and childcare drives up costs and then triggers expensive spending programmes to compensate, and what genuine fiscal consolidation through growth might actually look like.The Institute of Economic Affairs is a registered educational charity. It does not endorse or give support for any political party in the UK or elsewhere. Our mission is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.The views represented here are those of the speakers alone, not those of the Institute, its Managing Trustees, Academic Advisory Council members or senior staff. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit insider.iea.org.uk/subscribe