Would legalizing prostitution help the US economy?

A Nevada brothel owner says America is missing out on billions of dollars in taxable revenue.

By Bruce Kennedy Dec 13, 2012 11:54AM

Image: Couple holding hands (Corbis/Corbis)The fiscal cliff dilemma is prompting some novel ideas on how to reduce the federal deficit -- including the highly questionable suggestion of turning Uncle Sam into a pimp.


Enter Dennis Hof, owner of Nevada's Moonlight Bunny Ranch brothel. Hof has proselytized for years about decriminalizing prostitution outside his state, and argues that a legal and taxed sex trade could do economic wonders.


"The federal government receives $6 billion a year now, off of liquor," he said in an interview with the Huffington Post. "The prostitution industry in America is about an $18 billion business, and none of that money goes into the federal coffers or goes to pay taxes."


With his plan, Hof says, the government would gain about $6 billion in federal income tax "from the girls" -- plus nearly $2 billion more in licensing fees.


According to the Christian Post, the international sex industry is a $30 billion a year business -- with hundreds of thousands of women, men and children coerced into a brutal and degrading life as prostitutes. 


Hof says decriminalizing prostitution takes money out of the hands of criminals, eliminates sex trafficking and combats the spread of sexually transmitted diseases. "You can't stop it," Hof told the Huffington Post. "Prohibition doesn't work and legalization can solve a lot of our problems."


But even if you put aside the obvious moral issues surrounding a decriminalized prostitution industry, there are some doubts whether it would actually reduce crime.


Some advocates look at countries like the Netherlands -- where prostitution is legal. It's even an active and publicized part of the tourist trade in Amsterdam, bringing in about $100 million a year.  But Amsterdam officials say legalization did not end crime, human trafficking, money laundering or drug abuse in the city's Red Light District.


"While legalization was supposed to turn prostitutes into self-employed taxpayers who did not need pimps for protection," Reuters reported in 2007, "the city said the industry is still dominated by criminals attracted by the 370 Euros ($484 U.S.) each woman can earn a day."


And a new academic report, looking at data from 116 countries, found a higher instance of human trafficking in countries where prostitution is legal.


"Our research suggests that in countries where prostitution is legalized, there is such a significant expansion of the prostitution market that the end result is larger reported inflows of human trafficking," said Eric Neumayer, Professor of Environment and Development at the London School of Economics and Political Science, and co-author of the report.


"While legalizing prostitution can have positive effects on the working conditions of those legally employed in the industry, it also appears to boost the market for this fast-growing global criminal industry."


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Tags: Economy
336Comments
Dec 13, 2012 5:43PM
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Even the Bible says "It is better for a man to go in the belly of a woman, then to deposit his seed on the floor."  If the U.S.A. would legalize prostution, we would have fewer STD's because they would have to have a blood test and a pelvic exam once a month  from the spread of sexual infections. Yes I think it should be legal in all States. If you look to the nations that have legalized prostitution, the incidents of STD's is lower than in nations whrere it is still taboo.
Dec 13, 2012 5:43PM
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This country has fallen enough on the morality scale...we can't afford to go much further...
Dec 13, 2012 5:43PM
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Hey, if their going to make pot legal, might as well legalize prostitution. Let's just have one BIG party!
Dec 13, 2012 5:39PM
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I'm all in! Pun intended, this would be a good thing for all, except the "Johnny Do-Goods" who bitch and moan about everything from guns to legalizing pot. You don't have to play in the same park as everyone else. I like the park where your dog can run around, you stay out and you won't get bite! 
Dec 13, 2012 5:38PM
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I was married for over 10 years with no kids and she wanted a younger man to have kids and more money, so we divorced.  I'm finding it's a whole lot cheaper to buy a couple of hours a month for great sex with no ties than be married to a wallet sucking wife who is cheating on me anyway.
Dec 13, 2012 5:33PM
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America loves to pound it's chest and point to everyone else. America has lost it's morality and trust amongst it's own people. Just look at all the figure heads getting caught up with all their "Dirty Laundry". Just look. Fiscal cliffs, Global economics, Humanities. B.S.

If the world want to become evil that open the door and let evil prevail. Drugs, Sex and Rock and Roll. Let's blow out with a bang.

Yes to prostitution.

Dec 13, 2012 5:32PM
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Well, the Canadians in Ontario have legalized it starting next year so it will be interesting to see how they fare.
Dec 13, 2012 5:32PM
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Ok  so two guys can fork each other up the @$$ and get married. But there is something sick, perverted and criminal about the worlds oldest profession that never diminishes or goes away no matter what country criminalizes it.  Waste of money enforcing that code. Just as prohibition was. Taxation and regulation are whats really needed. As an after thought, at least somebody will have a job after the Obamanation runs US into the ground!
Dec 13, 2012 5:31PM
Dec 13, 2012 5:27PM
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Talk about the spread of AIDS and many other diseases. Just do what has always been needed in this country, Remove the big tax breaks from the Rich.  TADA! Problem solved.
Dec 13, 2012 5:27PM
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I see nothing wrong with legalizing "the world's oldest profession", as long as it could help the economy.  Nevada's economy was helped a bit due to legalized prostitution.  While at it, why  not legalize marijuana as well, and regulate it like alcohol and tobacco.  That could raise needed revenue while reducing illegal drug dealing.  As long as it can raise revenues without budget cuts or raising taxes, it's fine with me.
Dec 13, 2012 5:27PM
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If the government were involved we eventually be subsidizing the poor so they would have the option to be with a prostitute, I know it sounds crazy, but sooner or later you know that it would be an issue
Dec 13, 2012 5:27PM
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it is the worlds oldest profession and the politicians have been screwing us for years.
Dec 13, 2012 5:26PM
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We have lots of "sin taxes" how about we have a corrctive tax on political contributions.
Dec 13, 2012 5:24PM
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Congress is already prostituting themselves to the rich. And no they won't share the wealth!
Dec 13, 2012 5:24PM
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It already is, we elect them every 2 years
Dec 13, 2012 5:23PM
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well several years ago I used to charge 50 dollars as a male pro but there was so many fools giving it away I was going broke
Dec 13, 2012 5:22PM
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We The People should pimp out our Senate and Congressmen to pay for the deficit. High End Whores bring in good money, and though most of the politicians are men you wouldn't want to screw without lots and lots of drugs and alcohol in your system and bags over their heads, gloryhole and dark-room anon salons will suffice. Just keep free alcohol and condoms flowing, and make sure the pay machines work smoothly.
Dec 13, 2012 5:21PM
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Now thats a POLL tax even Republicans can support 

Dec 13, 2012 5:18PM
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There is another aspect to legalization which is legal protection. Right now, if either person becomes subject to fraud, theft or bodily injury the police will generally not pursue due diligence as much as they would if you were a "solid citizen". Even if you read about a hooker or John getting beaten up the generally feeling is "serves them right". This is one of the reasons Canada has tried to control the "biz". Tobacco and alcohol aren't illegal but there's still a black market to avoid taxes. That will continue with all things.
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