The Fat Tax that Wasn't

A while back Denmark passed a law to implement one of the first comprehensive "fat taxes."  A year after its implementation, it looks like they've changed their mind.  

One of the biggest drivers of the reversal was apparently public opinion, not to mention the negative economic impacts.  

I am often amazed at how easy many public health professions believe it is to change weight and corral bad behavior simply by just slapping a tax on things they don't like.  Just today, the folks over at Freakonomics discuss a recent conference where fat taxes were thought a really good idea (I've been a many of these kinds of meetings too).  

We economists often come across as uncaring , negative Nellies when we point out that such taxes often have very little effect on weight, have unintended consequences (as Denmark just realized), and are regressive (meaning that food taxes hit the poor the hardest).  

But, at the end of the day, who is more caring?  The folks pushing for costly taxes that wont materially change weight and health or those of us trying to prevent bad policies from affecting those who can least afford to pay the effects?

LA Food Police

If you haven't yet heard, the Los Angeles City council has declared the first day back to work each week to be "Meatless Monday."  According to one source,

Councilwoman Jan Perry, who also supports the banning of new fast food restaurants in South Los Angeles, said  the new resolution is just one part of a new "good food" agenda for the city.

I don't necessarily have a problem with private entities pushing for less meat consumption.  I might disagree with some of their claims (as I did here), but at least we can put all our facts on the table.  One fact that is often forgotten in meat debates is that it isn't sufficient to look at the amount of energy (or crops) expended to get beef.  We also have to look at what we get.  Most people really like the taste of meat.   

Almost no one looks at their iPad and asks, "how much more energy went into producing this than my old Apple II." The iPad is so much better than the Apple II.  We'd be willing to accept more energy use to have a better computer.  Likewise a nice T-bone is so much better than a head of broccoli.  I'm willing to accept more energy use to have a T-bone than a head of broccoli.    

Now, if my T-bone consumption is imposing costs on others, let's talk about that.  But, here the focus would be on the issues causing the externality (e.g., CO2) not on meat per se.  

The real trouble comes when city governments (rather than private entities) start making symbolic gestures (here's my take on what symbolic gestures imply about government).  Even more troubling is when a council-man or -women presumes to know better than a land-owner or restaurant owner how their land and capital should be used.  See this Reason TV video for an interesting account of developments in LA. 

First Lady Michelle Obama hopes to curb childhood obesity by teaching children about nutrition and exercise. "There's no expert on this planet who says that the government telling people what to do actually does any good with this issue," she says.

What Do Cage Free Eggs Have to Do with Gay Marriage?

Brandon McFadden, one of my inquisitive Ph.D. students, stopped by today and asked if I'd looked at the county-by-county breakdown of the vote on Proposition 37 on mandatory GMO labeling.  I hadn't, so we pulled up the maps.

Here is the county-by-county outcome for Prop 37 on mandatory GM labeling.

Brandon astutely pointed out that this map looked very similar to  the one on the gay marriage proposition back in 2008 (a no vote on Prop 8 was essential a vote in favor of gay marriage).

Back in 2008, there was also a ballot initiative (Prop 2) that (in essence) banned battery cages in egg production.  This map also looks very similar to the one above on Prop 8 in 2008.  So, Brandon down loaded the data from Prop 2 and Prop 8 in 2008 and did a little analysis somewhat like one we conducted earlier (the final voting tallies for Prop 37 aren't yet available in downloadable format).

Here is what he found:

(fraction of county voting for Prop 2 in 2008) = 0.326 + 0.572 x (fraction of county voting NO on Prop 8).

A hypothetical county with everyone voting no on Prop 8 (for gay marriage)  would be expected to have 32.6+57.2=89.8% voting yes on Prop 2 (for banning battery cages).  By contrast, a hypothetical county with everyone voting yes on prop 8 (against gay marriage  would be expected to have  32.6% voting yes for prop 2 (against banning cages).  

This little equation explains a remarkable 87% of the variation in voting outcomes associated with Prop 2!  A vote against Prop 8 was almost a guaranteed yes vote for Prop 2.  The people who want gay marriage are apparently also the same people who want cage free chickens.  

So, that raises the question I posed as the title of this post: What do cage free eggs have to do with gay marriage?  I might similarly ask: What does GMO labeling have to do with gay marriage?

Ostensibly, gay marriage has nothing to do with eggs or GMOs.  Yet, there seems to be a clear underlying factor (probably political ideology) that is driving votes on all three issues.  But, the facts on these propositions are so very different that is hard to imagine most reasonable people falling in line on all three.  

The results seem to suggest interesting areas of research related to political ideology and food choice.

Peru’s Congress Approves 10-Year GMO ban

According to this source:

Peru’s Congress announced Friday it overwhelmingly approved a 10-year moratorium on imports of genetically modified organisms in order to safeguard the country’s biodiversity.

It is always useful to look beyond a country's (or a person's) stated reason for an action for the real motivations.  Peru says it wants to ban imports of GMOs to protect biodiversity.  I notice they didn't point to health or safety concerns - probably because the World Trade Organization has already ruled that such issues were not a valid trade barrier for GMOs (see here for the WTO ruling in relation to the US-EU debate more than a decade ago).

So, if it isn't really about biodiversity (or only partially about biodiversity), what is motivating Peru's actions?  Here I can see two possible (additional) motives at work.  The first, is that this is a standard non-tariff trade barrier.  Peru can't slap a standard tariff on corn and soybean imports without running afoul of international trade laws.  But, they can protect their domestic producers (at the expense of domestic consumers) by putting other trade restrictions in place  that limit competition from international producers (Argentina and Brazil are big, nearby growers of GM corn and soybeans) .  The second is alluded to in the above story.  Peru is apparently a large exporter of organics.  The cost of maintaining segregated supply chains increases with a larger GMO market.  So a non-tariff trade barrier helps Peru maintain a relative advantage in international trade.   

I raise these issues because there will no doubt be some anti-GMO activists who emerge to say things like "see even countries like Peru have decided GMOs are too risky for human health and the environment."  But, as you can see the motives are far more complicated than that.

Assorted Links

1.      A rose by any other name . . .  The branding of pink slime

2.      Despite the large body of work by agricultural economists showing farm subsidies are not a primarily culprit for obesity, fingers are now being pointed to the effects of publicly-funded agricultural research.  Where is the discussion of food insecurity?

3.      A lively debate on GMO labeling

4.      This NYT article says eating fat makes rats dumb.  Didn’t Gary Taubes publish a piece in the NYT not too long ago talking about the danger of carbs and downplaying the evidence that fat is the problem?  Now we have a piece saying fat is the issue.  Not sure where that leave us?  Protein and water?