Ed Glaser - Demonizing, and/or Taxing, Soda. An excerpt:
Over the past 30 years, Americans have gotten a lot heavier thanks primarily to technological progress in the food industry, which has provided an abundance of tasty, caloric treats. The champions of public health are now fighting fat with the same tools that helped turn the smoky city of the “Mad Men” era into the clean-aired boroughs of Bloomberg...To my mind, there are two justifications for placing a tax on such foods:
Many public interventions can be readily dismissed because they are costly and ineffective. Yet the battle against cigarettes has taught us that taxes and advertising together can dramatically reduce an unhealthy habit. The public sector could indeed dramatically drive down the consumption of sugary sodas, but should it?
- If consumption of the food presents a directly externality on strangers. In that case a Pigovian tax on soda consumption may be appropriate. I do not see a strong case for that here. If a total stranger drinks too much cola and is carrying an extra 10 to 20 lbs, then is it really my business?
- As a cost effective way of increasing life spans. Both the United States and Canada spent a great deal on public health initiatives, despite differences in their health care systems. It may be the case that reducing obesity through a tax places less damage on an economy and improves people's lives more than treating obesity through the medical system, and paying for the medical system through other taxes (income taxes, sales taxes, etc.) I suspect one could make a very strong case that this will in fact hold - that this is a lower cost alternative than treating the side-effects of obesity in other ways. This tax is not really adding 'extra government' so much as substituting one form of government (cola taxes) for another (government subsidized medication for Type II diabetes).
Comments
haha on the subject of hypocrites
http://www.nytimes.com/2009/09/23/dining/23bloom.html?_r=1&pagewanted=all
I think there’s an externality you’re missing, a temporal one. Drinking too much soda impacts me, say, 10 years down the line. The disconnect is that my current self, in t=t0, only gets the cool refreshing and energizing benefit from my fizzy brown sugar water.
The future me, in t=t0+n, gets the weight gain, diabetes and aching joints. If there were some way to make the current me, at t0, feel the effects of my choices at t0+n, only then will my decisions be rationally made.
Not that that’s remotely realistic, but ….
The tax should not be on sodas. I drink diet sodas so I won’t get all that sugar (if you look at the calories in a teaspoon of sugar and the calories in a can of soda it comes out to about 9 teaspoons of sugar).
The tax should be on sugar and sugar replacements. That would hit all high calorie foods (sodas, candy, snack cakes, etc.) without punishing those who drink diet sodas. And the tax would be collected at the wholesale level which would be easier to collect.
i agree with ken..however the idea of making it a low cost alternative for reducing obesity seems promising