Smoking Bans: Harmful to Business

May 30, 2006

It seems that a recent ban on smoking in public establishments across the river in Ontario might not be such a great financial proposal, but leave it to the statists to ignore that aspect of it. The Detroit Free Press reports that the casino may have to lay off workers due to their forecasted revenue drop - revenue, which I might add, will simply make its way back across the river to Detroit’s three casinos. For the geographically challenged, Windsor Ontario is a hop-skip-and-a-jump away from Detroit, and until the D-town casinos were built, it was not uncommon for Michiganders to simply cross the bridge (or tunnel) to patronize the Windsor casino.

At $1.23B, Detroit’s three casinos, as it is, generated about 3 times as much revenue in 2005 as their Canadian counterpart, and says spokeswoman Jacci Woods, “We anticipate that we will definitely see an increase on this side of the border, for so many people that is part of the gaming process, smoking and gaming.”

Coupled with the recent legislation that requires US citizens to present a Passport to enter Canada, and the revenue drop since 9/11 “attacks slowed border crossings,” I’d think Windsor Casino would want to do everything within its power not to reduce its potential clientele. And in a free market, they could. In Canada, and a growing number of US States, establishments do not have that freedom.

Casino Windsor drew nearly $600 million in annual revenue before the 2001 attacks. Now, the casino is drawing about $383.9 million a year. And daily traffic has fallen from around 18,000 before 9/11 to about 12,521 visitors on average each day…

A study released by the Fair Air Association of Canada indicated that in Ontario communities that have smoking bans, bar and pub sales dropped anywhere from 18.7% (in London) to 24.3% (in Kingston)…”

Those figures substantiate my long-standing assumptions, which are also validated by the figures and estimates I’ve seen regarding revenue for pubs and bars in other cities where such legislation has passed. But it’s really a pretty simple matter; restrict the freedom of an establishments patrons, (indirectly, by restricing the freedom of said establishments property rights) and those marginal customers will find something else to do, or somehwere else to spend their money. Money which would otherwise be going into the pockets of Canadian hotelliers, Canadian restaurants, taxi companies, strip-clubs, pizza shops, etc.

Incentives matter? Go figure…


Posted in: Potpourri

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  1. …no third solution » Blog Archive » Another Smoking Ban June 12, 2007 10:06 pm

    […] are often bad for business. But with regards to any particular business, you can’t know that, and neither can any […]

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