Tax 'obesity' foods!

Discussion in 'Budget & Taxes' started by Reiver, Mar 1, 2013.

  1. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    There has been further rumblings here about introducing taxes on perceived 'bad foods' that are perceived to be behind obesity: the latest being sugared fizzy drinks. I personally see this as bad economics as it ignores equity issues and the failure to actually impact on 'long term utility enhancing' behaviour.

    But what do you think?
     
  2. OldManOnFire

    OldManOnFire Well-Known Member

    Joined:
    Jul 2, 2008
    Messages:
    19,980
    Likes Received:
    1,177
    Trophy Points:
    113
    Can't let you have a thread with no responses so I'll comment. If we tax sugary fizzy drinks to fight obesity, then should we tax all the TV shows which encourage people to act stupid? Should we tax people glued to their mirrors to help ward off narcissism? Should we tax the makers of Barcalounger's because they make people lazy? Should we tax politicians when they become pompass-asses?

    Wouldn't it be great to eliminate obesity, stupidity, narcissism, laziness and pompass asses just by taxation?

    Obviously I'm joking...but back to obesity, I am very concerned that fat Americans are going to place so much extra weight in the USA that this will cause the Earth's rotation to wobble like a car tire slowly losing it's lug nuts...and jettison Earth into another solar system...
     
  3. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    The issue comes down to the significance of the market failure. The standard argument is that, given we do not take into account the negative externalities from our behaviour, we overconsume (with obesity being a terribly obvious example of the consequences). Doing nothing, given these externalities, isn't appropriate. However, a more libertarian approach would be try to change behaviour (e.g. impact on social norms through education or subtle changes to the environment that we face, such that we don't even know that we've been shifted towards behaviour more consistent with our long term well-being).

    It arguably comes down to the extent that we think information provision will help. Thus, I am apparently shifted away from certain 'colour coded' goods that make me think about the fat content.
     
  4. OldManOnFire

    OldManOnFire Well-Known Member

    Joined:
    Jul 2, 2008
    Messages:
    19,980
    Likes Received:
    1,177
    Trophy Points:
    113
    I don't understand why we need to judge others, or worry about others, or try to control others, based on things like obesity? Every person has a different genetic system and is predisposed to dealing with things like obesity, etc. One person becomes an alcoholic while another person can drink like a fish with zero effects. One person can have 40-50% extra weight and fall apart when they are 50 years old while another might live a productive life until old age. Why must government interfere in people's lives and try to control them?

    Schools try to take sugary fizzy drinks out of the campus to deal with obesity yet the kid can buy them at any store anytime and their home refrigerator is filled with them. What's wrong with a school soda machine that has five choices of water and diet drinks and one choice of a sugar soda drink? Why can't these soda machines in schools be a tool to educate the kids with each choice showing calories, fat, sugar data? All taxing does is create inflation and place more pressure on those with less finances.

    Lastly, how stupid is it to worry about a sugar drink when the meals people/kids are eating might be 5000+ calories? Are we going to tax all high fat and high calorie foods? Where does this tax and control philosophy end...
     
  5. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    Its negative externality effects (i.e. costs we pay because of the behaviour of others). The key question is whether the standard analysis is enough (i.e. we have overconsumption because of the nature of supply: where prices, determining private costs, ignore these externalities such that we do not face the 'true' costs). Can we simply have less-than-rational behaviour whereby we make errors in our choices and we simply require to be nudged towards more rational behaviour?

    Neither is about control. One is about correcting for price flaws; the other is to aid decision-making.

    This is certainly the 'big issue'. Slippery slope 'nanny government' can be applied.
     
  6. OldManOnFire

    OldManOnFire Well-Known Member

    Joined:
    Jul 2, 2008
    Messages:
    19,980
    Likes Received:
    1,177
    Trophy Points:
    113
    IMO there will always be externality effects from people's behavior because nothing can be perfect or even close to perfect. Cigarettes and alcohol have tremendous externality effects, and we tax the crap out of them, yet consumption continues which means the externality effects continue. Take away people's sugary sodas and they'll make up for it by consuming more Gypsy Tarts! Trying to 'control' people's eating habits is like the tail wagging the dog.

    Aiding decision-making leads to control of something. Problem is the 'control' rarely can effect the root issue...like obesity. So taxing sodas, etc. are just Band-aid political approaches. When we create societies which have a million choices of food and drink, available 24/7, and our TV's and radios and Internets are constantly marketing these choices to us, and many of them actually taste great, it's no wonder at all why the collective we are becoming obese.

    Actually I'm more worried about all the synthetic crap we place in our foods and drinks, like artificial sweeteners, all of which someday I believe will show some nasty side-effects...
     
  7. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    You've got this wrong! Internalising an externality should merely mean you face the true cost from your choice. This will lead to a marginal shift in consumption, eleiminating the market failure. The real problem is that, due to inelasticity of demand, there is a genuine fear of general 'revenue raising'. This lead to tax regressivity without any significant accountability effect on government (e.g. they can use such inefficient tax to reduce taxes on the well off)

    The latest medical paper has attacked processed meat, using regular consumption to understand early death. The problem with such evidence, when we aggregate the findings, is that we eventually get the standard 'everything kills you' result
     
  8. OldManOnFire

    OldManOnFire Well-Known Member

    Joined:
    Jul 2, 2008
    Messages:
    19,980
    Likes Received:
    1,177
    Trophy Points:
    113
    Yes we face the true costs of our choices but there are also costs external to us directly related to our behavior. We have bloated governments and wealthy attorneys all dealing with the outcome of our behaviors.

    I don't have a problem with regressive taxation on items which can be considered non-essential; tobacco, alcohol, gambling come to mind. Fizzy sugary drinks are non-essential. But even these are encroaching on the food groups and we know food is essential. Don't know on your side of the pond but most places in the US do not tax food items. Taxing fizzy sugary drinks is considered a food item.

    Well...everything doesn't kill us and in fact even the supposedly worst foods don't kill us. It is our eating habits that cause ALL of the problems! And beyond eating it is our lifestyle habits...
     
  9. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    I think you are confusing the book "Nudge" by Richard H. Thaler and Cass R. Sunstein, where they co-opted Libertarian in their phrase “libertarian paternalism.” These idiots are cut from the same cloth that called the left liberals.

    If Libertarians don't care if you use drugs, why would the concern themselves if you wanted to OD on sugar?
     
  10. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    Market failure?

    The negative externalities occur only because the burden for care is spread over the entire society, rather than concentrated on those with bad behavior. Taxing bad foods is nothing but slapping another bandaid on a flawed system.
     
  11. pimptight

    pimptight Banned

    Joined:
    Aug 20, 2012
    Messages:
    5,513
    Likes Received:
    23
    Trophy Points:
    0
    I think that if you just tax unhealthy food it does nothing, but if you tax unhealthy food, and use the revenue to subsidize healthy food, and a double bacon cheeseburger costs 7$ while a fish sandwich on flatbread costs 2$, we will massively reduce heath care costs.
     
  12. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    We'd certainly need earmarking. Its the only way, after all, to ensure revenue raising abuse isn't used by the corruptive influence of government
     
  13. Anders Hoveland

    Anders Hoveland Banned

    Joined:
    Apr 27, 2011
    Messages:
    11,044
    Likes Received:
    138
    Trophy Points:
    0
    I just find the idea of taxing whole milk ridiculous. Yes, it is not healthy to drink too much milk - whether it's whole milk or non-fat milk. Yet milk is a natural traditional food, and is healthy in limited portions as part of an overall mixed diet.

    I am angered by the very idea of crazy, controlling health-socialists want to tell us that whole milk is bad. Not everyone needs to lose weight, you know. Some of us live more active lifestyles and need all the calories we can get. Why should I suffer just because 50% of everyone else is too lazy and obese to get off their couch?

    Maybe the government should go after specific people and label them as obese. The government can issue identification cards determining who is allowed to buy fattening foods. Only the obese must comply. :smile:
     
  14. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    How exactly do you do that?

    The government spends a lot of money on unpopular activities. Did government ask for more tax money for corporate welfare, or was it "for the children"?
     
  15. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    Maybe the government stops paying for health care, and allow medical insurance to work like every other insurance, to charge based on the behavior of the individual. Let those with unhealth habits pay for their own negative externalities.

    That way you don't pay more for milk, and Reiver doesn't have to worry about the fat tax moeny going into the general fund.
     
  16. Reiver

    Reiver Well-Known Member

    Joined:
    Sep 24, 2008
    Messages:
    39,883
    Likes Received:
    2,144
    Trophy Points:
    113
    There is error in your thinking! Health care has public good characteristics, ensuring underprovision if left to the market
     
  17. OldManOnFire

    OldManOnFire Well-Known Member

    Joined:
    Jul 2, 2008
    Messages:
    19,980
    Likes Received:
    1,177
    Trophy Points:
    113
    The concept makes sense but it can't work in the free enterprise system.

    The US government subsidizes farmers some billion$ each year, and although I don't know the details, I'm guessing the reasons are to control higher prices and profits instead of letting the markets determine these things. Don't know about other areas of the US but where I live the cost of vegetables and fruits is simply a joke! Even in a Safeway it is rare to see anyone buying produce...it is simply too expensive.

    The USA is capable of producing all the vegetables and fruit needed by Americans plus export a (*)(*)(*)(*)load around the world. But we don't do this and are importing more all the time...why? Why aren't we encouraging more farming? Why don't we have a goal to make vegetables and fruits the lowest cost items in a grocery store? I suspect the answers to everything above is cost and profits! This is really the same as health care and all other issues we have today; the costs are skyrocketing!

    Logic should dictate that with higher and higher prices of food, and continuing economic issues, people should be eating less and tightening their belts and losing weight. Instead it's the opposite...we are gaining weight. Here's an article from today's news; http://todayhealth.today.com/_news/...ere-eating-fewer-calories-getting-fatter?lite
     
  18. Anders Hoveland

    Anders Hoveland Banned

    Joined:
    Apr 27, 2011
    Messages:
    11,044
    Likes Received:
    138
    Trophy Points:
    0
    You mean like me having to look at fat people in public? Or fat people hogging up more than their fair share of space onboard an airplane?
     
  19. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    You add complexity on complexity, trying to compensate for bad behavior while the government you support eliminates the concequence of that behavior - and I have an error in my thinking?

    Is isolating the cause from the effect in the public good?

    When health insurance charges more for smokers (long before they are sick), it reduces smoking, and puts the burden for care on the person that requires the care. The market created the problem, a competing market fixed it.
     
  20. FreshAir

    FreshAir Well-Known Member Past Donor

    Joined:
    Mar 2, 2012
    Messages:
    150,175
    Likes Received:
    62,815
    Trophy Points:
    113
    the precedent has been set with cigarettes... it's a slippery slope anti-smokers and the like are happy to go down

    .
     
  21. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    One minor problem, government decision have been based on flawed science. Until recently, the bad guy was red meat and saturated fats. Sugars and simple carbs replaced them as a "heart healthy" diet. Is the science better now?

    Studies comparing the Atkins diet to a government approved diet showed the Atkins diet improved heart health indicators, and provided more weight loss, even compared to a 1400 calorie diet.

    Government has shown itself very capable of taxing vices, not very good at subsidizing virtues.

    - - - Updated - - -

    The US collects enoughmoney from cigarette tax to pay for the required health care - except they don't.
     
  22. FreshAir

    FreshAir Well-Known Member Past Donor

    Joined:
    Mar 2, 2012
    Messages:
    150,175
    Likes Received:
    62,815
    Trophy Points:
    113
    I agree, though I would add, almost everyone, smoker or not will at some point require health care services they can not afford and will need assistance form insurance and\or the government (if they live long enough)

    and if smoking shortens life span... they may not collect social security or medicare.... increasing life span increases health care costs (ironic isn't it)

    personally I think processed food is a big contributor to rising health costs and obesity in this country.. more so then smoking ever was

    .
     
  23. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    Insurance, or at least the way it is supposed to work, averages out lifetime expenses, more immediate feedback on bad behavior. Government averages out national expenses, no feedback on bad behavior.

    Except, the last 10 years of a smokers life can be horribly expensive - more so than someone that is reasonably healthy for 85 years, then dies at 86. Even if from a chronic illness, it is only a year, not a decade.

    Agree completely, and have adjusted my diet accordingly. Lost 40lbs, and feel great - more stamina (without exercize) than I've had in 30 years.
     
  24. FreshAir

    FreshAir Well-Known Member Past Donor

    Joined:
    Mar 2, 2012
    Messages:
    150,175
    Likes Received:
    62,815
    Trophy Points:
    113
    the last 10 years of anyone's life, smoker or not can be horribly expensive, aging is a terminal disease that ends in death... as of yet there is no cure

    "more so than someone that is reasonably healthy for 85 years, then dies at 86."

    same is true of a smoker that is reasonably healthy for 85 years, then dies at 86. <-- did you know some of the oldest people to ever have lived were smokers? smoking reduces stress, stress kills too

    .
     
  25. Not Amused

    Not Amused New Member

    Joined:
    Jul 23, 2011
    Messages:
    2,175
    Likes Received:
    19
    Trophy Points:
    0
    I stand corrected:

    http://www.forbes.com/sites/timwors...moking-do-not-cost-health-care-systems-money/

    The actual numbers for lifetime from 20 years old medical costs were:

    The lifetime costs were in Euros:

    Healthy: 281,000

    Obese: 250,000

    Smokers: 220,000



    In reality, we should reduce the taxes on unhealthy behavior.
     

Share This Page