If you don’t mind, Matt, having got my first stage III economics paper out of my hair this morning (and it seemed to go pretty well, all things considered 😉 ) I’d like to take this a little further.

I’m interested in how you differentiate between your support for a carbon tax and your ‘disgust’ at the Pigouvian taxes on tobacco products.

To channel your comment on tobacco, “we punish people who want to emit CO2 heavily because they don’t fit into our ideal.”

I look forward to your comments.

As challenging as always, Matt!

Agreed

Agreed – great song. And useful, as it can be read both ways.

This is the difficult margin – at what point, and it what way, do individuals get responsibility over their own actions. This is a point people can disagree upon, and it is a value judgment. I have had a lot of great conversations about that issue in the past. I’d prefer having this honestly discusses, as a moral discussion of responsibility for self, rather than having people use “faux economic” language to sell their own judgement.

That was the key point in my point – we need to stop using terms like “externalities” as ex-post rationalisations of things we already support, and instead ask what value judgments they embody so that society can say whether it disagrees or not!

And what a great song too. And yes, I deliberately mixed paternalism and time inconsistency because we should be concerned when young people do things now that will lead to pain in later life, and which they will regret. Although being concerned and knowing what the best course of action is, are two different matters

There are two concepts mixed together in this sentence – time inconsistency and paternalism. Time inconsistency comes from the fact people can’t commit, paternalism would be justified from the idea that someone with more life experience may have a good idea regarding what will hit the individual in the future.

The first one does get quite a lot of play, and is IMO the main justification for policy (and in turn implies different types of policy interventions). The paternalistic arm in this case can have some merit – our “knowledge” is in some sense social, so sharing it is a good idea. But it can also go too far if we confuse the fact individuals make different choices as they are different with the idea that they are making them because they “don’t understand”. This reminds me of another song!

“All that said, I generally don’t think taxes to discourage obesity is necessarily the answer, as it victimises the poorest, who are the most likely to fall prey to rubbish food. We could look at the causes of the obesity epidemic and address that. For example, we could have the food equivalent of the FDA and just simply not allow manufacturers to supply desperately unhealthy food products to the market – the visible fist of government.”

This really is a value judgement. Poor people will ‘fall prey’ to rubbish food and so must be protected from themselves. Very paternalistic and condescending I would argue, effectively implying that they are poor and stupid. And to protect them we will restrict choice by removing unhealthy food. But what is unhealthy food? Surely the issue is total energy issue? I would be reasonably confident that I can get fat by over-eating any food, healthy food included. Everything in moderation.

So maybe we could reduce obesity by some amount by restricting availability, but at the cost of personal choice. I like the occasional burger, and I am not obese so why should I have my choice restricted? Maybe because I am educated and not poor I would get access to an ‘elite’ burger store, maybe we could have vouchers for people that could be trusted or allocate them on the basis of BMI?

And once we have partially solved that ‘problem’ what shall we move onto next?

Tobacco, tick, sugar, tick, alcohol, tick, too much TV, tick, too much time in the sun, tick, not enough physical activity, tick.

And I think the “time inconsistent” idea does not get enough focus either, in this context. What some people call “paternalism”, could also be called “a wiser head helping you avoid pain in later life”