12 December 2017

Can anything stop the march of the nanny state?


2017 has seen yet another increase in lifestyle regulations and sin taxes in Europe, with both national governments and Brussels imposing new rules.

While countries adopt varying degrees of economic interventionism, different standards over fiscal consolidation, or alternating positions in reaction to climate change, lifestyle regulations seem to be popular across the board.

Historically, it was social conservatives pushing for this kind of meddling. In the United States, various Clean Living movements lobbied heavily for measures like bans on tobacco, as they associated cigarettes with other vices like alcohol and pornography. These campaigners claimed eliminating such evils would mean a return traditional family values and a fall in crime. Tea and coffee were also considered harmful because of their capacity to awaken “evil traits”. While men were vulnerable to alcohol and tobacco, it was women at risk from the dangers of coffee and tea.

How different is today’s excruciatingly irritating public health lobby old-time puritans who now seem absurd? Can we even be sure that coffee and tea won’t make it on to the list of dangerous substances kept by the Nanny State’s officials. Alcohol and tobacco long ago fell prey to their officiousness.

As well as unnecessary, these policies can also be woefully designed. Take Scotland’s new system of minimum pricing for alcohol, which ignores basic behavioural economics. The most likely outcome is that low-income consumers just spend are larger chunk of their income on booze, instead of investing in their own health. On tobacco, “public health advocates” have simply ignored the evident failure of plain packaging measures in Australia. When policymakers ignore the facts, what hope can we have that they come up with effective policies?

It’s not just alcohol and cigarettes that are subject to the watchful eye of the public health lobby. Food and non-alcoholic drinks are also under fire, and blamed for a range of health issues. France and Ireland are now cracking down on that scourge on society: fizzy drinks. Ireland introduced a new tax on sugary drinks, while France increased the tax created in 2012 under French president Nicolas Sarkozy. Such policies are highly regressive: rich and middle-class households will hardly notice the measure, while low-income households have to take the hit.

When Denmark introduced its controversial tax on fatty foods, consumers simply switched to cheaper – but equally unhealthy – alternatives. The country’s diet did not improve. Sensibly, the political majority that introduced the tax abolished it 15 months later. Ireland and France refuse to do the same.

We’ve reached a point where most governments simply do not base their lifestyle regulations on evidence-based policy-making. Dare to disagree with this ban or that tax and you are dismissed as a corporate shill who doesn’t think of the children. Unfortunately, this is symptomatic of politics more generally.

Ask someone about prohibition in 1920s America and they will – almost invariably – tell you it was a failed policy. Prohibition created a powerful and violent black market, it poisoned the quality of basement alcohol sales and it punished responsible drinkers. In fact, the devastating results of US alcohol prohibition is constantly used as an argument for the legalisation of substances such as marijuana.

Why shouldn’t these arguments apply to other interventions in the market, be that Scottish alcohol minimums, extortionate Irish excise taxes or Norwegians state-monopolies on booze: they reduce access for mostly responsible consumers, and hit low-income consumers the hardest. Lifestyle regulations are both socially unjust and economically ineffective.

We are adults and we sometimes make decisions for ourselves which are unhealthy. The answer is for us to moderate our consumption, not quasi-prohibition. It’s time to stop infantilising the European consumer.

Bill Wirtz is a Policy Analyst for the Consumer Choice Center