What began with a string of legislation and bans aimed at the tobacco industry is now coming to the dinner plate. Following closely on the tails of litigation against McDonald’s for making children fat and Oreo’s for including trans fats. The City of New York recently banned trans fat in its restaurants. Let’s take a look at some of the economics of the matter.

In June the CDC announced the annual loss of productivity due to smoking deaths at $92 Billion, which does not include the additional $80 Billion in losses due to smoking related illnesses and hospitalization. Compare this with the annual cost of obesity at $90.7 Billion, with between $6-$8 Billion in New York state alone. It is easy to see that both smoking and obesity (of which trans fat has been linked along with increased damage to the circulatory system) cause a significant monetary risk in terms of productivity. Now there is an argument that could be made with respect to the amount of capital the tobacco and restaurant industries contribute back to the economy, but there is a more fundamental principle being overlooked.

The question that must be raised is where should the line be drawn on economic state paternalism and informed choice. It is easy to argue that smoking leads to second-hand smoke which, for those who do not smoke, makes it difficult not to be exposed in some degree to the harmful effects. The banning of trans fat however removes the ability of the consumer to choose outright. Should a restaurant such as Kentucky Fried Chicken, which recently introduced its trans fat free addition to the 7 herbs and spices, make the switch it merely changes the consumers product selection. If government entities start stepping in to say ‘this is bad for you, you can’t have it anymore’ they have crossed a dangerous line.

George Reisman recently posted a related article with an embedded Orwellian flair:

“Within ninety days, every citizen must report to a government authorized physician to be weighed, measured, and interviewed. On the basis of the data so obtained, the physician will determine the appropriate diet for the citizen in terms of calories, fats, proteins, and every other relevant category of nutrition.

“Within a further ninety days, each citizen will receive a ration book containing weekly allotments for the various nutritional categories. In buying food in supermarkets, restaurants, or anywhere else, the citizen will have to turn over whatever portion of his weekly allotments correspond to the nutritional values of the foods being purchased. All sellers of food will be required to determine the nutritional values of the foods they sell, if they have not already been determined. It shall be illegal to purchase food without surrendering the necessary allotment coupons. It shall be illegal to
buy or sell such coupons.”

While I don’t believe we are on the verge of such harsh measures, the recent actions in New York are disturbing. Will more stringent rules, such as those aimed at driving smoking out of private residences, follow the food we buy at the grocery store? Will trans fat be banned at home? How can a government balance personal welfare, economic cost and informed choice? Should a government?

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