Individual choice & the soda tax
There’s a revealing graph in today’s New York Times. It shows, essentially, how decades of subsidies for corn (and therefore, corn syrup) has made the least healthy food – soda – the cheapest.
The article is about the soda tax, which is basically DOA in New York State right now, even though Albany sure could use some new revenue.
The biggest argument you hear against the soda tax is this: why should the government tell me what to drink? It’s my personal decision. If I want to drink tons of soda, that’s my business.
David Leonhardt points out there’s a growing chorus of economists and health care professionals concluding that’s not true. But they’re being drowned out by the lobbying efforts of the soda industry.
Obesity has become a huge driver of spiraling health care costs that affect every one of us, both in our own premiums and in the taxes we pay for everyone’s Medicare, Medicaid, etc.
In the case of soda, those costs come in the form of medical bills for diabetes, heart disease and other side effects of obesity. We’re all paying these bills, via Medicare, Medicaid and private insurance premiums. Obesity has become a significant cause of our swelling long-term budget deficit.
And soda is a huge reason the country is so much more obese. The typical American consumes almost three times as many calories from sugary drinks as in the late 1970s. This increase accounts for about half the total per-capita rise in calorie consumption over the same period. Remember, many of these drinks have zero nutritional benefit — unlike meat, cheese or juice.
We accept taxes on tobacco and alcohol to help pay for the social and economic cost of these drugs. Why not a drink that has no nutritional benefit that we’re all paying for in the doctor’s office?
.png)
I strongly favor a soda tax! So much money is spent for health care after people drink soda that the drink is actually much more expensive than water (and I mean tap water–don’t even get me started on bottled water!). A spokesperson for one of the soda companies claimed the “nutritional” value of sodas because they are mostly water. I didn’t know whether to laugh or to cry when I heard that. Corn syrup=NO value. Artificial sweetener=NO value (except to increase your desire for more sweet stuff). I’m sticking with my water! Drink all the soda you want; pay for it!
the graph demonstrates that subsidies work. lets not tax soda, lets not subsidize corn either, and let values find their own way. thats the free market no? there has got to be a way to subsidize the farmer, and get the healthier crops rather than corn syrup. who’s in charge?
..and besides it’s not the taxes. it’s what the numb-nuts do with the revenue when they get it, isn’t it?
Sorry, but what I drink or eat wouldn’t be anyone elses concern if we weren’t rushing towards socialized health care!
Bret,
Even with private insurance, personal bad decisions affect others. Everyone else covered by your insurance company has to pay for your health care costs.
Unless you’re talking about no one having insurance altogether, and you pay the doctor directly. If so, good luck with that $100,000 open heart surgery.
verplanck:
How much is that heart surgery in chickens?
I think it was mentioned on an earlier blog post, but I would rather see us remove the subsidies for the raw materials that are used in soda mainly corn syrup and or sugar or sugar related crops and “products” than impose another tax.
Also our issues with weight are tied to much more complex social, emotional and economic factors than a simple tax will sort out.
why not eliminate subsidies and impose a soda tax? both sound like great ideas to me. and while of course mervel is right that no simple tax will solve a complex problem like obesity all by itself, so what? if the tax makes things better then it should be implemented.
David starts out by saying, “see how government caused this problem”.
Then he ends it with, “let’s let government solve this problem.”
Verplank- good point, it is still a problem even with standard group type insurance. My bad. So instead of taxing EVERYONE the soda drinking obese-itrons (yes, I made the word up) should pay a higher premium. Works with people and auto insurance, should work that way with health insurance too. I say that as a guy who could stand to loose 20 lbs, although I neither drink much soda, smoke or have too many other vices.
HT- “…if the tax makes things better…”. I’m sorry friend, but lines like that just make my skin crawl. Beyond the simple logic of our having no way of knowing if it will work, the larger issue of the “undying tax” looms. Once a tax is in place it never is rescinded. We were still paying for the Spanish American War till a few years back! If you implement the tax even if it does nothing to affect the fat body problem there is no way that revenue stream will be cut off. Now, as I said I’m not much of a soft drink guy. My drinks are coffee and water. But I do know a lot of soda drinkers and the vast majority of them aren’t fat at all. Why should they be forced to pay extra for a health issue they don’t have? If I get a soda at McDonalds with my lunch why should I be forced to ay a premium for that 1 soda a month I might drink? It seems to me this is another case of not putting the responsibility where it belongs- on those who don’t control their intake and pass their health issues onto the larger group. That’s just backwards IMO.
As far as subsidies, get rid of them. But- do it slowly so you don;t put a bunch of corn farmers out of business or anyone else either. This can be done smartly if we’ll think about it a bit. Before you end the subsidies you’ll need to sell the higher costs that will ahve to be passed on to the consumer to the public.
More taxes are always the cure for everything in this country aren’t they? Maybe instead of jacking the premium of everyone because 10% of the people on the policy are overweight retards, we be more stringent on who qualifies for health insurance. Instead we want to punish everyone in the country because Joe blow down the street drinks 4 sodas a day? What does our national anthem say? Home of the free? Free to do what? Pay taxes. That’s about it at this rate. People don’t want to be told how to eat, drink, live. Fine make incentives for them to be healthier, don’t punish everyone and their brother because some people out there can’t control themselves. But this whole speal about trying to make everyone healthy. What a crock, next you’re going to say you want to help me make more money. The government is doing what it always does. Balancing their piss poor decisions on the little guy.
Bret (and others),
Even if there’s less government, somebody is running things, and, in effect, governing. And in America, in the absence of effective government regulation, it’s not the individual who makes the governing choices, or even the market–it’s the corporations with the most money and power. That’s just how the deck is stacked.
So if you allow insurance companies to charge more for obese-itrons, it’s still a tax. It’s just a tax from a corporation. And when the time comes, they’ll just throw the obese-itron off the rolls. It’s a win-win.
Anyhow, the people with the most money earned all that money, because they’re better than you and me. So they should be allowed to do whatever they want.
Enough snark. Just like there aint no such thing as a free lunch, there aint no such thing as a free market.
I would disagree, there is a free market. There is no one “running” things. That may make us feel better, it gives us something to blame; but there is not. We live in a world of our own accumulated choices, for good and for bad. We are fat because we choose to live in a manner that causes us to be fat. I will take that over a world of power, control and social engineering. This tax for example has nothing to do with rich people, all sales tax including this one is regressive all sales tax always hurts poor people more than rich. So yes in this case rich people won’t be paying much of this tax so they can indeed do what they want.
I don’t know where people get this bizarre idea that big government is good for poor people.
Well see, its not about fat people, its about making money. Eateries which have a soda fountain purchase more or less just the syrup, which is going to cost them an arm and a leg if and when this new tax comes into play. The government doesn’t care about you, they’d rather have you too fat to get through the door, that way you cannot fight them. They are going after businesses.
And if that’s not true, my problem with the tax is the fact that its going to be on other things, not just soda. We’re concerned about fat, well jeez you ever look at the label on a diet pepsi. 0 Calories, zero everything except 25mg of Sodium. Tap water is horrid in many places, be it from the village pipes or your own well. I’m lucky to have an old deep dug well that has probably the cleanest water, while my neighbors all have that horrid rotting egg sulfur water.
They tax alcohol and tobacco because its extremely harmful, tobacco causes cancer and a whole list of other diseases for many, and alcohol causes liver and kidney problems if abused to much, not to mention fatal accidents when people get behind the wheel.
Its not the sodas fault that people are fat, its parents who allow their children to woof down mass amounts of soda and junk food and then let Little Billy sit in front of the tv or computer to play games all day. Don’t give him soda, give him water, give him juice, make him go outside during the day. These parents want to blame everyone else for their fat spoiled little kids, when its their own fault, cause you know, its never the fault of the parent.
It is a major problem, and people are starting to get bad attitudes towards fat and large people, not knowing who they may be. I am six feet four inches tall and clock in at 300 pounds, I eat less than 2000 calories a day, I drink diet soda that has no calories in it, and work a job that is physical. Thankfully I am what I call “old school fat”, because there are genetically large people. Want proof? Fine, I’ll slap down pictures of my father, his brothers, my grandfather, my great grandfather, and great great grandfather, who are all large people, and I know my grandfather who grew his own food crops and raised his own meat didn’t get fat off eating McDonalds, there wasn’t even one around here in his lifetime.
But in general yeah, it scares me that its becoming harder and harder to find a skinny child waiting for the busy.
anon, if you can come up with a way to break up the big corporations ( lets not get into the crimes you’d be committing depriving people of their rightful property) that will somehow fix it all, well, I’m listening…
Where did I say anything about depriving people of their property? I just said tha tin the absence of the boogym, “government,” people are still governed. In our case, it’s by a largely corporate plutocracy that has convinced people like you and Mervel that they don’t exercise control over your life. They do. Accept it.
Quick example; BP just made a bunch of decisions on how much your seafood will cost.It is not a tax, per se But it’s a fee imposed on us next time we want shrimp. How much input did you, me or Mervel have in that decision?
Back in the ’60’s there was a sugar shortage when Cuba became communist. Hence, a rise in sugar prices. Back then, I wondered why the price of club soda went up along with ginger ale and Coke. 50 years later, seltzer and club soda, still cost as much as their high fructose corn syrup shelfmates. If soda is taxed to curb obesity, will my unsweetned favorite drinks be spared? Doubt it.
Well none of us have true control but that is the nature of life, I would choose market forces which I understand and I have some choice over versus the power of the King. All I am saying is that I would rather have the freedom of choice even if that choice set is limited, rather than have those choices determined for me by a government by fiat based on what it feels is good for itself and for me.
We all have boogymen, on the Left it is the “evil” corporations and businesses on the right it is government, we all search for something to blame, and the reality is neither are true.
But deciding who is fat and who should pay for being fat seems like kind of a reach for government given we can’t even protect our own autonomy or provide for the basic needs of poor children.
I don’t think the government is the boogyman, we need government all modern societies do and all free markets do to function properly.
I would be against the tax on drinks sweetened drinks if those who are against the tax would also be against the taxes on tobacco.
Until that happens, I say tax everything.
Put a sales tax on houses in addition to the property tax. Put a tax on food. Tax everything equally.
The problem here is social engineering through taxation.
We like this. Don’t tax it. We don’t like this, Tax, baby tax.
Anon- Sorry if I went off on a tangent. The cry of “corporate evil” is getting deafening lately. What the corporation haters forget/ignore is that corporations are made up of people, not all of them wealthy by any means. The cry of “the evil corporation” implies the issue needs to be addressed. How else would you address the issue other than cutting the corps. up? What that does is deprive all those investors- the teachers, truckers, insurance agents and factory workers- of their property.
As for your admittedly snarky “people with the most money earned it” line, yes. There’s a very good chance they or their parents did earn it. Why is that wrong? “…they’re better than you and me…”??? Cool, let me refer you to a good counselor to deal with your feelings of inadequacy. Come on, you’re obviously intelligent enough to get beyond mere class envy. I don’t “like” rich people but I’m not going to be so petty as to call them “evil” just because they did better in life than I have. Chances are there are poorer people than you and I in this world that look at you with the same class envy you have!
If you choose to consume a corporations product, that’s your choice. Gov’t gives us no choice. There is the difference.
Pete- I’d be one of the ones agreeing to the no tax idea. Social engineering through taxation- what a cruddy idea.
Hey, I’d even agree to the tax everything if they’d quit SPENDING it all and then some. I could submit to taxes for a few years if it would pay off our debts, but that never will happen.
Mervel- we need Gov’t, certainly. We don’t need an unresponsive, over reaching, intrusive and inefficient gov’t. This was never intended by the Founders. We’ve done exactly what they didn;t want.
While we’re at it lets tax the hell out of sugared cereals, french fries, hamburgers, tacos, deep fried Twinkees…
Oh well, since Jonathan egged us on, I’ll keep this going.
Mervel said: “I don’t know where people get this bizarre idea that big government is good for poor people.”
Probably from Social Security, for starters, which made life appreciably better for senior citizens who were starving to death during the depression. And from programs like Medicare and Medicaid and Head Start. None are perfect (though I don’t find many critics of Head Start), but they’ve measurably improved the lives of poor people.
Bret said: “If you choose to consume a corporations product, that’s your choice. Gov’t gives us no choice. There is the difference.”
I would argue with that. You are the government, Bret. You have a chance to help elect representatives and call them to account. That’s a choice too many people don’t make. But it’s a choice, nonetheless. You seem to think that all government is totalitarian. It’s not.
And you seem to think that all private enterprise is virtuous. It’s not. And people on this thread seem to dismiss my earlier points about corporate overreach as saying all corporations are evil.
That’s not what I said. I’m saying barely checked corporate power is as awful as unchecked government power.
Power abhors a vacuum. When people attack government as “the problem,” and the only problem, and weaken its ability to check plutocrats, the big money jumps in to take over. It governs your life, no less than a government does.
Since some people here like to throw around Ayn Rand, I’ll throw out a couple of my favorite writers. There are a couple of routes to tyranny foreseen by novelists in the middle of last century: George Orwell’s 1984-style totalitarian state, and Aldous Huxley’s softer, but no less controlling, drug-addled commercial/consumer society.
My problem with a lot of conservatives is that they only see evil in Orwell’s world. But both societies are straitjackets for the individual.
And our country, IMO, is moving closer to the Huxley model.
The majority of social security payments do NOT go to poor people, the majority of medicare payments do not go to poor people. Poor people get TANF, Food stamps and medicaid which are not federal budget priorities. Certainly yes we needed to help people who were starving in the great depression, but that has really little relation to the massive size of government today and what that massive government does with its money. Which is largely pay interest on the debt, pay social security and medicare, and pay to fight wars. So no, big government does not mean we are helping poor people.
The average government worker today for the first time in history makes more than the average private sector worker.
Big governments serve the vested interests of those who support them. It is the reason for example that NYS has such a large per capita government and yet has a higher poverty rate than many states with smaller governments on a per-capita basis.
So yes we need a safety net I fully support a BETTER safety net, but increasing the size of government will not mean that happens.
Mervel,
Just because SS and Medicare don’t help ONLY the poor doesn’t mean they don’t help the poor. In fact, one reason they’re still helping the poor is because they help the middle class and the rich, too. It’s a broad constituency for the programs, so they’re popular and they’re not easily killed by budget balancers.
Another example of big government helping poor people: Rural electrification (the Tennessee Valley Authority) and road-building in the 30s, 40s and 50s, which linked up previously remote areas to the rest of the country, bringing people a higher standard of living. Again, it didn’t JUST help the poor, but the poor benefitted, especially in the electrification case, as much or more than anyone.
Also, you say: “The average government worker today for the first time in history makes more than the average private sector worker.”
But isn’t that because of flatlining or declining (in real, inflation-adjusted terms) private sector wages, rather than big increases in public-sector wages?
It’s like the ongoing teacher-salary debate here; teachers don’t make appreciably more, in relative terms, than they did 40 years ago. It’s just that their wages rose along with inflation, while a lot of private jobs just disappeared. So relatively, teachers now look rich.
We outsourced our unionized manufacturing jobs, first to NAFTA and then to China, and replaced them with non-union fast food and service sector jobs, so working class wages fell.
No?
Okay, let me say that there’s is a difference between “big gov’t”, especially in the sense we’re talking here, and effective gov’t. There are Gov’t programs that work, no doubt. But there are hundreds of Federal level programs that are replications of State level programs, of other Federal programs, of private programs. What we’ve developed is a very large Federal Gov’t, one that is far larger than we need or can afford. Much of what the Federal Gov’t has assumed through the years was once handled or would be more appropriately handled at the State level. Through the Commerce clause and other ways the Federal Gov’t has overstepped it’s mandate in many areas. For instance- there is currently a battle going on in a few states over certain firearms. Guns made in one state, sold in that state and remaining in that state cannot fall under the Interstate Commerce clause, so the Federal Gov’t has no right to regulate in anyway their manufacture, sale or possession. This has been proven in court time and again with other items. The argument happens to be about guns in this case. It’s the states responsibility to regulate those items. IIRC the same argument was made during the depression regarding chickens or cattle feed- where a farmer was being regulated (taxed) for something he didn’t fall under. The over reaching Federal Gov’t lost that case and common sense says they’ll lose this case which will hopefully transfer over to the Health Care Reform bill at some point. The Federal Gov’t has no right to meddle in the affairs of a states rights issue. The Federal Gov’t has no right to mandate that an individual within a state purchase health insurance or for a non-interstate employer to provide it! The right doesn’t exist, yet the Federal Gov’t has usurped these rights from the states. At the State level it is legal- if NY wants to have cradle to grave health insurance then that’s NY’s choice. But that doesn’t mean Vt. is required to follow suit.
These are basic concepts that anyone should be able to grasp. How we’ve let things go so far is a crime.
Anon- yes, I have a certain amount of choice in that I can vote, and protest and lobby my representative. But I still have to pay my taxes or I will be jailed, deprived of my property and my family will be left destitute. If I choose not to eat at McDonalds I don’t think Ronald is going to show up with Mayor McCheese and Big Mac to cart me off to prison with the Hamburglar. In that respect, Gov’t is totalitarian. And I never said ALL private enterprise is virtuous. But all private enterprise, by definition, involves the property of another. By what right do you assume to limit another persons use of his property unless it can be shown to do you real and intentional harm? You speak of corporate overreach, yes, a business can become powerful to the point that they can overreach. But that’s a subjective assessment in most cases. I may think Kraft is too big and monopolistic because it, along with other dairy industry companies, keeps the price of milk artificially low- with the Gov’ts help! That’s just my personal opinion. I don’t buy Kraft products, they can’t force me to. If I voice my opinion others may agree and also boycott Kraft or Chrysler or Time-Warner or Microsoft. That’s the free market (such as it is) that you say doesn’t exist. There was a big anti-sweat shop move against Nike a few years back IIRC that resulted in that company altering it’s practices. So the market can work. It doesn’t mean that Kraft or BP or Nike will cease to exist, but it can force change. But it takes enough people caring enough to participate to make the change. They take responsibility for their personal decisions to push that change.
The same thing goes for this soda tax. Over reaching gov’t using a tax to force change on a people that seemingly aren’t concerned with the issue. Does Gov’t have the right (legal, not moral) to use taxes to alter eating habits? Salt is also on the agenda. That’s quite a leap if you ask me.
Well argued, Bret, though I think you’re pretty utopian about the effectiveness of boycotts, etc…, and the effectiveness of markets in general. How well has that worked in bringing down Kraft?
When corporations become monopolies or oligopolies, there is no market anymore, in any practical sense.
Government and laws are an important counterbalance to corporate overreach and abuse of the public. There are places where the market doesn’t work, or (to use more purely economic terms), where the actual costs aren’t included in the market price–like the cost of dead lakes from acid rain not being included in energy prices in the 1950s and 1960s, or the proper risk assessment oil drilling in a mile of water, or the automobile costs of being stuck in traffic.
That’s my argument.
But people can disagree about stuff.
The jackbooted Obamabot socialist nazi thugs haven’t stopped that. At least not yet.
The End??? (Cue ominous minor piano chords.)
One more thing, though: “Does Gov’t have the right (legal, not moral) to use taxes to alter eating habits?”
Of course it does. That’s why it’s legal for minors to drink wine in socialist nanny state France, and why it’s not legal in the U.S., where they hate us for our freedom fries.
The end? Naw, I’m baby sitting the granddaughter today so I’m stuck in the house, free to debate!
Boycotts, or more accurately large sectors of the consuming public making an alternative choice, hasn’t made any difference with Kraft because 99% of the nation couldn’t care less where their food comes from or what a farmer is paid. That Farmer Joe still earns 1975 wages is fine as long as the consumer dollar goes further. On the other hand, do you know anyone that would willingly buy formula made in China? Are Ford Pintos still being made? Chevy Corvairs? When gas and diesel went over $5.00 a gallon did you rush out to buy a Hummer? Whens the last time you saw a Yugo, an AMC, remember Aides breath mints? (talk about the kiss of death!), does Kramer from Seinfeld have a show these days? That’s the market working.
Now, you and I are in total agreement in a couple areas- Once a market is cornered there is no competition and then we have an issue. This was expressed recently to me by a farmer who was concerned about the price of fuels. If diesel goes back up over $4-4.50 a gallon he’s done for and he believes most of the other farmers will go under if the price goes over $5.00 and stays there. What’s that mean? That means corporate farms will be the rule of the day, mega corporations providing the vast majority of dairy, in this case. So lets say Kraft ends up owning 30% of the dairy farms across the nation, a not impossible event. If Kraft and a few other big companies own the cows does anyone think the price of cheese and fluid milk and it’s by products will remain low? That is where problems come in. So the normal thought is to break up the corporation/monopoly. The problem there is that Krafts stocks would have been appreciating in value, the stock holders might have been putting their money into other fields- green energy or cancer research maybe. So in walks righteous Uncle Sam with a big ol’ hammer to bust up this evil corporation. Once Sam gets by the various bought and paid for Senators and Congressmen, he takes a mighty swing and wipes Kraft off the map. There goes all that nice fresh cancer money, there goes that solar project, there goes the trust fund for Clarkson or SLU.
Actions have repercussions. If you let Brets Dry Cleaning, Nuclear Energy Company and Bait shop run completely unchecked chances are there will be very clean worms 75 feet long with 3 heads roaming around in a short time. You apply limited, common sense oversight and regulation to the haz mat end of the dry cleaning chemicals and the whole of the nuclear plant and you stay the heck outta my worms. You let me sell shares and I grow my company and provide jobs to the locals, branch out into chicken wings, cancer research and tattoo removal. I’m successful, I pay my taxes, am employing 5000 people and providing much needed product’s and services. Now you may not like me, you might think I’m an overbearing, neanderthal retard, but that doesn’t make me evil. If you find out I’m employing 4 year old orphans to pick worms and to clean the cooling pipes in my nuke plant, go to town and cut me to pieces. Until then I’m golden. Just don’t make the mistake of trying to tax my corporation to the point that I decide to up and move from beautiful downtown Speedzoneahead, NY to some place in tax free Klbghpnmytistan. Nobody wins then, you just lost.
Didn’t the telecom industry boom when government busted up the Bells in the 1980s?
Didn’t the internet bubble crash when Clinton went after Microsoft for monopolistic practices?
In 1994? No. In 1998? No. In 2000? Yes there was a crash just before the US v Micrsoft decision was handed down, and nerves ahead of that decision may have contributed. But the sole reason? C’mon. That also had to do with years of inflated dotcom stock prices with no earnings, higher interest rates that drove down the value of stocks in general, and even a lapse in tech business after all the work that had been put in to avoid the Y2K problem.
Anyhow, the tech sector is doing just fine right now. It was a needed correction, because it was, you know, a bubble. It’s weird hearing this from you. I thought you liked competition.
Do you prefer the monopoly company-store model of capitalism? I’m serious.
Nope, just pointing out that actions have consequences. What I would like to be able to do is to come up with a fool proof method of keeping lots of good companies from becoming a megacorp. But that’s not gonna happen, it’s just another form of market control and it would run counter to the free market principal. That free market idea is something I’m exploring a bit more lately. In theory, what I know of it anyway, if we have, say, 12 good solid companies making equally good products then all 12 should do well and stay in business. That means lots of jobs and security. Is it wrong for one or two of the companies to buy out some of the others? What if the companies all make different products and all the workers remain employed and the company grows. Is that wrong? What if it ends up just being 2 companies left? Is that wrong or right? Does ethics trump good business sense or do ethics even come into it if the companies are good stewards and do their best to serve their workers, stockholders and public?
I guess my question is- When does a corporation become “evil”?
“What I would like to be able to do is to come up with a fool proof method of keeping lots of good companies from becoming a megacorp.”
Then you’ll never succeed, or be satisfied.
Because nothing is foolproof. Nothing is perfect. Yet you’re always bemoaning the fact that there’s not a perfect solution to any given problem as a way to end the argument.
Antitrust laws have worked in the past to break up big corporations, trusts and monopolies. Not always perfectly, or without unintended consequences. But sometimes with beneficial unintended consequences.
And you’re always attributing critics of corporations of saying they are “evil.” I never say that and don’t believe it. But anything that’s too big and too centralized, including but not exclusively government, brings with it a whole bunch of problems, not the least of which is a taking away of individual liberty.
Can we at least agree on that?
Or is my answer not perfect, and therefore wrong?
PS–“In theory, what I know of it anyway, if we have, say, 12 good solid companies making equally good products then all 12 should do well and stay in business.”
Give me one real world example of this happening for any length of time in a country where antitrust law is not enforced. I don’t think you can.
Yes, we can agree on that.
An example? There were lots of examples in the furniture, clothing, farm implements, appliances, machinery. Many of those companies were bought out by a corporation and continued on for decades. Allis Chalmers is a fine example of a corp that was highly diversified and very successful, so were Ford and International Harvester at one time. They weren’t the mega corps of today, no. But they were good, solid companies employing thousands.
Are those the kinds of examples you wanted?