Yesterday, Todd predicted that Obamacare will result in greater government involvement in heretofore private decisions that impact health. Since the government is now going to pay (via insurance subsidies) for many more Americans’ health care, it has a much stronger interest in how they live. So do we taxpayers who must pay for the government’s largesse. As Todd explained:
Once I am paying for your health insurance, I suddenly care a lot whether you … eat that Big Mac for lunch instead of the salmon salad. In today’s new America, I suddenly really care how much junk food the people making less than $88,000 eat — I pay for every Dorito that crosses their lips. … (Evidence this is our future comes from the UK, where 75% of people in a recent survey supported greater government control over individuals’ food choices.)
This need to control people’s lifestyle choices in order to constrain spending on their health care explains Section 4205 (“Nutrition Labeling of Standard Menu Items at Chain Restaurants”) of the recently enacted health care legislation. Today’s New York Times and Wall Street Journal are both reporting on this little-discussed provision of the legislation. As both papers explain, the law requires chain restaurants (20 or more outlets) to display calorie information on menus, at the order counter, and at the drive-through.
Specifically, the restaurants must display “the number of calories contained in the standard menu item, as usually prepared and offered for sale” and “a succinct statement concerning suggested daily caloric intake, as specified by the [FDA] by regulation….” In fact, the restaurants must provide the caloric content of each item on a salad bar: “[I]n the case of food sold at a salad bar … a restaurant or similar retail food establishment shall place adjacent to each food offered a sign that lists calories per displayed food item or per serving.”
I don’t know how effective this rule will be in getting people to eat more healthfully, but I suspect it will be fairly costly to implement. I’m also skeptical of the informational value of a “succinct statement concerning suggested daily caloric intake” — if such a thing is even possible. To generate a number resembling an individual’s optimal caloric intake, you would need to know, at a minimum, the person’s gender, age, height, weight, and activity level (see, e.g., these calorie calculators). I therefore can’t see how the FDA could formulate a “succinct” statement of optimal calorie levels. Of course, the folks at FDA are experts. Maybe they’ll find a way.
There has been some talk recently about whether the Obama administration has given up on the “libertarian paternalist” approach advocated by regulatory chief (and Nudge co-author) Cass Sunstein. Section 4205 suggests that it hasn’t.
While I’m skeptical that it will work, I sure hope it does. Otherwise, our dear leaders are likely to jettison the libertarian part of their libertarian-paternalism, and those nudges will become shoves.
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While I understand the sentiment about the value of information disclosure, antitrust guy, consider what the drive in menu at a typical fast food place will have to look like in order to provide caloric details on every single item (presumably in a legible font size). Do you really believe such information is that valuable and, at that point in the consumption decision, likely to have a meaningful impact?
On the other hand, the health care proposal completely ignores the real information disclosure problem in the health care market, and that is the opacity of price information for the cost of care itself. Forget insurance prices. Getting some price transparency at the provider level would have much more significant effects on lowering cost of care than will having places that serve food everyone knows is less healthy post just how less healthy it is.
I have a hard time challenging the value of information disclosure in a market economy.
Sure, we could leave it to the free market to provide information or not, but as things go this is far less worrisome than more interventionist approaches.