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Monday, October 01, 2007

tax on fat or fat on tax?

As an occasional writer, sometimes fictional pieces like plays and screenplays and short stories, sometimes articles for pay, I am one who believes in holding onto his writings for possible future retrospect. My first attempt to blog here resulting in my computer freezing up and today when I came on to see if my blog still existed (evidence of at least 20 minutes of work), I was disappointed, no enraged, to see that it wasn't. I look below to a little pop-up that says, "Now Blogger saves your drafts automatically!" HA!

So the subject of my interest pertains to the "twinkie tax."

The concept was pioneered in the early 1980s by Kelly D. Brownell, Ph.D., director of The Rudd Center for Food Policy and Obesity at Yale. Brownell proposed that revenue from junk-food taxes be used to subsidize more healthful foods and fund nutrition campaigns. It is estimated that a national tax of 1 cent per 12-ounce soft drink would generate $1.5 billion annually, and a national tax of 1 cent per pound of candy, chips and other snack foods would generate revenues of up to $314 million.

The idea of taxing something, since we’re a taxing kind of nation anyway, that would discourage a person from over-indulging in something that is creating obesity sounds alright by me! Granted, I could stand to shed a few pounds, I don’t eat much junk food and thus would not be affected much by the tax. But, 314 million dollars sounds pretty good, and perhaps that would alleviate other goods from being taxed… yeah right! The issue that is of concern in light of the lessons in class, is that such a tax would be an example of a “nanny state” and from what I understand about the various ‘states’ our government can be, (protective, corrective, redistributive, paternalist) I’d prefer that our government be protective more so than the other ‘states.’ Because I look at the increase of size of our government and am cynical of what these numbers mean. 314 million dollars sounds great to someone like me, but I’m sure that of that money, there would be a committee designated to oversee the ‘project’ and there would be ‘research’ involved, etc. Of that $314, how much would actually go towards something like supplementation of health care or national defense? And how much would go into some appointed person’s paycheck? To me, government is just as fat as many of the Americans who would be ‘positively’ affected by implementation of the sin tax towards obesity-fueling foods. One point of discussion in class has been regarding the economic efficient allocation of whatever resource, including fatty foods. Would the allocation of the monies earned (what a funny word to put here) from the ‘twinkie tax’ be efficient? I highly doubt it! Ideally, government would function as an element of the governed. In his writings, Buchanan adopts, modifies, and transfers Wicksell's 1896 principle of unanimity to the constitutional stage of collective choice.

Buchanan's "contract theory of the state" shifts Wicksell's analysis of taxation into the sphere of constitutional choice. Throughout his career, Buchanan has aspired to the Madisonian goal of first empowering and then constraining government.

James M Buchanan's book, The Calculus of Consent (1962), co-authored with Gordon Tullock, is considered one of the classic works that founded the discipline of public choice, a melding of economics and political science. In particular (1962, p. v), the book is about the political organization of a free society. But its method, conceptual apparatus, and analytics "are derived, essentially, from the discipline that has as its subject the economic organization of such a society."

Seeing the words, “Madisonian” and “unanimity” makes me think of class and what we’ve been learning. And according to Holcomb “…for a market economy to function, property rights need to be defined and protected…” So, would a tax on the free trade of fatty foods from a producer to a person who wants to gorge freely be an example of legitimate coercion by government? The juggle of the governed allowing the government to grow is a slippery slope. For one, it makes sense to limit government, but on the side, it seems like a good idea to give the authority to government to discourage obesity. As I stated above, I wouldn’t be disinclined to vote “yea” on a tax that would neither affect me personally (directly) or would discourage people from frivolously purchasing something that will later have to be dealt with and paid for by my tax dollars. However, from an economically normative stance, government is already big and getting bigger, why encourage it to continue? In fact, I wouldn’t mind a ‘fat tax’ being implemented to the growth of government! Wouldn’t that make things interesting?

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