AUGUST 8, 2005
A pizza delivery car cruises down a leafy suburban street as a man
in a black overcoat and a red power tie scampers after it, waving a
piece of paper. "Trial lawyers used to only chase ambulances,"
explains a voice-over. "Now they're chasing restaurant deliveries
to cash in on obesity."Even if you haven't seen this advertisement, you may understand the
message. Over the last few years, attorneys have been filing
lawsuits on behalf of obese consumers, claiming that restaurants
and the food industry should be held legally responsible for making
people fat. The crusade seemed legally preposterous back in 2003,
when a federal judge dismissed a lawsuit against McDonald's for its
marketing of unhealthy foods and portion sizes. But, earlier this
year, a federal appeals court reinstated part of the case, arguing
that plaintiffs had the right to examine McDonald's records for
evidence that the company misrepresented the nutritional value of
Polls suggest that the public is not yet ready to indict Ronald
McDonald for the nation's health problems; in one 2003 survey,
nearly 90 percent of respondents said they oppose obesity lawsuits
against the food industry. But, with even more litigation in the
works, the food industry and its allies aren't taking any chances.
As The New York Times reported earlier this month, laws shielding
the food industry from lawsuits accusing them of encouraging bad
health have passed in 20 states and are under consideration in
eleven more. "Those supporting obesity lawsuits are attempting to
bypass the legislative process and regulate through litigation,"
explains the National Restaurant Association, which is lobbying
intensely for these laws. "Congress and the appropriate regulatory
bodies are the proper entities for addressing these matters, not
judges and lawyers."
The restaurant group is right, of course: Lawsuits probably aren't
the right response to America's unhealthy eating habits.
But how about taxes?
Silly though it may sound, there's a very sensible case for taxing
unhealthy food--or, at the very least, two unhealthy substances
within food. One is saturated fat, commonly found in beef and dairy
products; the other is transfatty acids, or transfat, which the
food industry adds to products during baking or frying. Both
substances increase the level of "bad" cholesterol in the blood,
which clogs arteries. Transfat seems to be a double whammy: It
appears to reduce the level of good cholesterol, which counteracts
the effects of bad cholesterol. Scientists agree that anything
beyond minimal consumption of either increases the risk of heart
attack and other circulatory problems, with no offsetting health
benefits, even for otherwise healthy people. Economists agree that
the treatment of these conditions--whether through prescription
drugs to treat high blood pressure or angioplasty to open up
clogged arteries--is very expensive.
The government has already taken some steps to reduce consumption of
unhealthy fats--with some success. In 2003, the Food and Drug
Administration (FDA) announced it would require food manufacturers
to include transfat content on their labels. The industry fought
that requirement bitterly. But, with the regulations taking effect
next year, manufacturers are busy removing transfat from their
products, with companies like Frito-Lay leading the way. The FDA
estimated that this change alone could save up to $3 billion a year,
on average, in health care costs over the next two decades.
By contrast, calls to impose taxes on unhealthy foods have raised
mostly hackles--or worse. When Dr. Kelly Brownell, director of the
Yale Center for Eating and Weight Disorders, introduced the notion
in a Times op-ed a decade ago, Rush Limbaugh called him part of a
"high-fat Gestapo" trying "to force the American people to act in
the 'proper' way."
When you put it that way, the idea of a "Twinkie tax," as it has
come to be known, really does sound absurdly paternalistic. If you
want to load up on french fries, health risks and all, why is that
the government's business? Unfortunately, fat consumption really is
the government's business in one, very literal, sense. As
taxpayers, we all bear the burden of higher medical costs-- either
directly, by paying for Medicare and Medicaid, or indirectly, by
subsidizing employer-based health insurance (which is tax
deductible). So, when some people choose to eat poorly, we all end
up bearing the financial burden for their decisions. A Twinkie tax
would help rectify this, however modestly. Government wouldn't be
scolding Americans about their choices. It would simply be asking
them to confront the costs of those choices--namely, the future
medical bills that fatty foods make more likely.
But the link between the Twinkie tax and health care funding must be
explicit. Proponents like Brownell usually talk about using the
revenue to finance health education campaigns or otherwise improve
dietary habits--thus reinforcing the idea that they are, as one
National Review writer put it, "busybodies pining to police your
plate." Government could instead earmark the funds for programs
like Medicaid (or, better yet, universal health insurance), which
provide health benefits for the poor and uninsured. Among other
things, this would help address a major flaw in the Twinkie tax:
its inherently regressive nature, given that poor people spend a
larger share of their income on food. (The tax could also exempt
milk, which would probably make good medical sense as well, since
pediatricians generally recommend that babies consume whole milk,
which is high in saturated fat, until the age of two or three.)
Note how linking the Twinkie tax to health care expenditures turns
the ideological calculus on its head. The most coherent argument
about health care that conservatives make is that insurance, by its
very nature, insulates people from medical bills to the point where
they have little or no incentive for healthier behavior.
Unfortunately, the right's preferred solution to this problem of
"moral hazard" is simply to transfer more medical bills onto
individuals--a shift that punishes not only those who have bad
habits, but also those who have bad genes or simply bad luck.
Taxing unhealthy foods, on the other hand, puts the financial
consequences where they belong: On largely voluntary behaviors that
lead to higher medical expenses. The Twinkie tax doesn't reduce
personal responsibility, which is the usual complaint you hear
about big government. It increases it.