Why is it wrong for the government to encourage individual behavior through taxes and subsidies? In my mind they are just accounting for externalities. I think they should do it more. For instance, a carbon tax could one of the most powerful tools for fixing climate change.
Human beings act based on their environment, we don't do things for no reason. In this case, sugary drinks are popular for a reason, it is that reason we need to think about and combat, not attempt to stop people from reacting to the forces against them with taxes. In this case we need to end the subsidies for farms and crops, to make it so that people pay true costs for their sugary drinks, and to allow the healthcare system to charge extra money for an unhealthy lifestyle. These are natural systems that adjust themselves over time and dynamically react to the forces on society. A tax sticks around for ages, funnels money away from where it should be going, and sticks around long after it is needed. Carbon taxes are a different category of things, in that we have an action that is an externality. The emission of carbon HAS to be cleaned up and offset, and companies today are NOT paying that price. The point of a carbon tax would be specifically to offset the damage done by a harmful activity which is a fairly constant and ever-present issue in society. There will never be a time that a carbon tax is not a good thing, and it corrects a balance in the economy that cannot be fixed otherwise. The government isn't paying for our healthcare, it needs to stay out of taxing us for the choices we make about our health. If it would like to charge those on medicare for drinking sugary drinks, than it is well within it's right to. If it is involved in investing in and pushing for the offset and cleanup of carbon emissions, than it is within it's right to charge for it.Why is it wrong for the government to encourage individual behavior through taxes and subsidies?
I agree that we should end the crop subsidies (Beef, too, but that's a different issue). I also agree that we should allow the healthcare system to charge extra for an unhealthy lifestyle. However, both of these things would help the problem in the exact same way as a sugar tax: by making sugar more expensive. How do these things not disproportionately affect the poor, but a sugar tax does? They have the same effect on the consumer! Sugary drinks are popular because 1. they are cheap, and 2. they are addictive. What would change this is making sugar more expensive. I am unconvinced that the health consequences of consuming so many high fructose drinks are not an externality. I think it totally is, the exact same way that lung cancer is a negative externality of cigarettes. Less people smoke now in part because of a culture shift, but also in large part because cigarettes are more expensive now. Obesity, and other metabolic syndrome symptoms, is not just an American problem. Obesity is now an epidemic in nearly every wealthy country.
I never mentioned the impact the taxes have on the poor, it's not really a huge concern for me. If the government wants to help the poor they can do so through extended, strong, social security nets, good education policy, and a strong progressive tax system. If the poor are doing something that is harmful to themselves then making them stop through tweaking the system properly will not hurt them in the long run, it will help them. Externalities are harms done to others by an actor. When a person drinks sugary drinks they are deciding to perform some action to themselves, it is not the case of the sugary drink companies producing things that harm others who have no control over the situation. People can, even if addicted to a substance, choose to stop using sugary drinks. You can't chose to or not to be effected by carbon emissions, you can choose to drink or not drink sugary drinks. The government should focus on ensuring people have that choice through information campaigns (informative ones, not propaganda ones). lung cancer through second hand smoke is a negative externality of cigarettes. Lung cancer in smokers is not. In this way the statement would be that smokers, who choose to smoke near other people should be responsible for the damages they do to them. In fact, they are, through higher insurance payments and high cigarette taxes. We can solve obesity without resulting to excessive taxes, but through setting up the system to function properly in the first place.I am unconvinced that the health consequences of consuming so many high fructose drinks are not an externality.
The way I look at it, lung cancer in smokers and obesity in the general population are both negative externalities because of the increased burden on our healthcare system. For people that do not have insurance or are on medicare (which is a significant portion of people), taxpayers and hospitals cover the cost of their poor decisions. There's the hidden cost right there. That's all a negative externality is: a hidden cost not reflected in the price of some good.
This is why I said that insurance companies should be able to charge more for things like smoking (they can), and without insurance in the US you have to pay for your treatment anyways. It is currently illegal in the US to not have insurance, so not being able to pay high costs shouldn't be a significant issue. As well, It is well within the governments right to charge for medicaid if they wanted to punish smokers for smoking, or people for living unhealthy lifestyles. A tax is not needed.
I understand your point, but it's not true that those without insurance in the US have to pay for their treatment. They owe money to the hospital that treated them, but they often don't pay it. Hospitals are not allowed to refuse service for emergency care. Additionally, while it is illegal in the US to not have insurance, the penalty is a small tax penalty, and the law doesn't stop a lot of people from still not owning insurance of some kind. I do think insurance companies should be able to charge more for things than smoking, but I think, while maybe not needed, a tax would help the problem even more.