Economics 101

Once again, if you tax it, people will seek out the lowest option.

• We walk up to the bulletproof glass at the counter.
  
  "Newports, short," we tell the clerk, sliding payment to him through the slot below. He slides back our cigarettes and a receipt.
  
  The damage: $7.50. Smokers looking for economic relief must love this store. It's a dollar cheaper a pack than most stores in Chicago.
  
  But if you're the deficit-ridden city or Cook County, this store is not your friend. Not when the pack bears no evidence that the 68-cent Chicago tax and the $2 Cook County tax have been paid.
  
  As cigarette taxes have gone up, smokers have been finding ways to avoid them, from driving out of state to buying online.
  
  
• In 2006, city revenues from cigarette taxes came in at a little less than $32 million. By 2008, they had declined to about $25 million. This year, they're projected to drop again.
  
  "In most places, tax increases lead to increased revenues," said David Merriman, a University of Illinois at Chicago economist who has studied cigarette-tax avoidance worldwide for 15 years. "Chicago would be the only place I know of where it's gone the other way."

Really? And this is a professor of economics?

Perhaps he could do a case study of the bottled water tax? Revenues went way down in Chicago after Daley imposed that tax. Surrounding suburbs can't keep bottled water in stock since Shortshanks disregarded the laws of economics. Or maybe the hated "head tax" that keeps small businesses out of Chicago and drives bigger business away? There's dozens of examples, all of which fly in the face of this "economist" who seems to have not traveled the world in search of actual economic examples.