An Alternative to the Fat Tax
August 2, 2011
Taxes dominate the debate on solving America's obesity epidemic. There are big problems, though, with this idea, says David Gratzer, a senior fellow with the Manhattan Institute.
- Even the most favorable studies argue that dietary taxes have to be very high -- in the 18 percent to 25 percent range -- before they will have any real impact on consumers.
- Even then it's not clear that people will eat healthier; they may just shift their calories (from soda to chips, for instance).
- Even if they didn't do that, taxing unhealthy foods is far more complicated than taxing paper sticks filled with tobacco.
Consider a positive alternative: Insurers -- public and private -- should offer rewards for measurable improvements in healthy behavior instead. Two studies published this spring suggest there is significant evidence that incentive-based weight-loss programs can be successful. The first study was British, appearing in the Journal of Public Health. The second study was American, published in the Journal of General Internal Medicine.
- In the British "pounds for pounds" experiment, about 400 people were paid to lose weight.
- On average, the program cost about $300 per participant.
- Forty-four percent of participants finished the year with "medically significant" weight loss, and nearly one-quarter of the group averaged 25 pounds lost.
- The American study tested a variety of financial incentives on a group of veterans, finding that "incentives produced significant weight loss over an eight-month intervention."
- The catch? Participants tended to regain the weight after the incentives had ended.
- But that's no deal-breaker because it should be possible to design longer-term incentives. For example, Safeway's Health Measures program offers annual cash incentives for healthy behavior for its employees.
Source: David Gratzer, "Fat Taxes Go over Like a Lead Balloon," Washington Times, July 29, 2011.
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