Mexico Did a Sugary Drinks Tax and Sales Keep Falling – Legit Debate

They actually did it.  Those crazy commie Mexicans actually did a form of what Leninist Mayor Bloomberg tried to do in New York but was denied by freedom loving Americans corn syrup industry lobbyists.  They passed a tax on sugary drinks in Mexico in 2014 and sales fell 5.5% (which is what the lobbyists are actually afraid of, the tax working the way it’s intended).  Critics said sales would level off, but then in the second year they fell even harder by 9.7%.  Sure bad for the sugary drinks industry (what we call “pushers” in health conscious anti-freedom circles), but good for the overall health of Mexicans, especially poorer people.  Less consumption of junk food has overall long term benefits for society’s spending on health problems.  So they’ll benefit from smaller waste sizes and lower healthcare tax burdens.

The finding represents the best evidence to date of how sizable taxes on sugary drinks, increasingly favored by large American cities, may influence consumer behavior. The results could have consequences for public health. But they also matter for policy makers who hope to use the money raised by such taxes to fund other projects. Philadelphia, San Francisco, Oakland, Calif., and the Illinois county that contains Chicago have recently passed taxes similar in size to the tax in Mexico.

I am absolutely pro-tax on sugary drinks for the sake of overall health.  Sugary drinks are a pox on a society in which empty calories are so abundant it takes effort to avoid them, versus the great predominance of human history where acquiring calories represented a difficult mathematical formula – how many calories do you have to expend to gain the calories you need to survive.  Per Jared Diamond’s “Germs, Guns and Steel” one of the cornerstones of a thriving society is the ability to create calories efficiently.  Hunting and gathering presented a precarious calorie chasing challenge.  Places that could cultivate cereal grains thrived while those that are mainly sustained by tubers do not.  Easily acquired calories creates leisure time, creates learning and innovation, etc.

A mere dozen species account for over 80 percent of the modern world’s annual tonnage of all crops. Those dozen blockbusters are the cereals wheat, corn, rice, barley, and sorghum; the pulse soybean; the roots or tubers potato, manioc, and sweet potato; the sugar sources sugarcane and sugar beet; and the fruit banana. Cereal crops alone now account for more than half of the calories consumed by the world’s human populations.

The development of easy calories was a great thing, until it wasn’t anymore.  For many reasons the 20th century saw a tipping point where the equation of consumption of calories minus calories burned changed in favor of diabedes, obesity and the increasing health problems of too much success as a society.  (So much winning we’re dying earlier.)

So here we are with, in my opinion, one of the few legitimate conservative versus liberal debates on how to deal with such a problem.  Conservatives loathe using taxation as a social cudgel to curb “vices” like smoking, overeating, overconsumption, etc.  Use eduation and let people make free choices.  Liberals say, education? sure.  Choice? sure.   But simple economics, which conservative should respect, dictates that taxation works to curb bad habits and provides funds to fund said education and deal with the societal costs of the problem in the meantime.

Anybody who looks at the long term issue of cigarettes would concede that the heavy taxation on the product has had a very large part in the decrease in smoking over the decades, maybe not as large a part as the dissemination and broad acceptance of the science that smoking is profoundly bad for you, but a disincentive is a disincentive.  If anybody thought the increase in cost wouldn’t work the lobbyists fighting it would be otherwise employed fighting climate change or rationalizing fracking or something.

The argument that higher taxes curtails freedom is a self-refuting argument.  People are free to choose the product, and often do, despite the higher taxes.

What Bloomberg likely did wrong in NY was try to prohibit drinks larger than 16 ounces rather than just tax it all, as other cities have done.  Obviously vice taxes are well established, while prohibition is also established as pretty damn ineffective.

Crazy thing is we sure learned our lesson with the prohibition of alcohol, and yet people who completely understand that prohibition was a spectacular failure in the case of alcohol, still push it for narcotics.

All in all it seems like the rational choice for both conservatives and liberals – do not prohibit but disincentivize through taxation.

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