Using food and beverage price interventions to address obesity.

AuthorSauder, JoAnne

The high rate of obesity in Canada is an increasing challenge to public health. This paper will examine the possibility of using price interventions as a strategy to address the problem of obesity. Price inventions could include taxes on unhealthy foods and subsidies on healthy foods. Taxes may help individuals internalize the true cost of the food they eat, discourage unhealthy purchases and provide money to support programs that promote healthy eating. Obesity is a challenging problem with many social, economic and environmental factors. There is no simple solution to obesity. Price interventions may be an important addition to a larger strategy to reduce obesity.

Currently, it is difficult to establish the efficiency of price interventions; more research is required in this area. Until this occurs, a reexamination of the definition of basic groceries under the goods and services tax/harmonized sales tax (GST/HST) to ensure that it promotes healthy eating would be a wise first step. This paper will start by examining obesity in Canada and its contributing factors, including the role of agricultural subsidies. Next, will be an examination of price interventions based on public health policy and as a response to the market. Lastly, will be a consideration of what forms food and beverage taxes and subsidies could take.

Obesity as a Public Health Concern

Obesity in Canada is a public health concern; it affects the quality of life of many individuals in Canada and is a significant economic drain. The rate of obesity in Canada is 23%. (1) The effect of obesity is an increase in hypertension, type II diabetes, gallbladder disease, coronary artery diseases, osteoarthritis, stoke and certain types of cancer. (2) The cost of obesity to the Canadian health care system has been estimated at $2.1 billion. (3) The cost total to the Canadian economy has been estimated to be $6.6 billion. (4) The Federal, Provincial and Territorial governments have committed to reduce the effect of obesity in Canada. (5)

One contributing factor to obesity is the cost and oversupply of energy-dense foods. Energy-dense foods are those that provide a large amount of calories relative to their weight. They are less satisfying than energy-dilute foods and lead to overconsumption. (6) The price of food has continually fallen and there is an oversupply of food. (7) Calorie intake has increased in Canada; the total calories consumed by Canadians increased by 17% between 1991-2001. (8) The types of foods consumed have also changed. Canadians are consuming increasing amounts of energy-dense foods. These include cream, fats, oils and soft drinks. (9) Canadians now have access to greater amounts of less satisfying energy-dense foods at lower prices and they are consuming more of them.

Rates of obesity are related to socio-economic status. Rates of obesity are higher for individuals with lower levels of education and lower incomes. (10) This may be the result of the high price and lack of access to energy dilute foods in low income areas. (11) Some low income families incur food insecurity, making unhealthy, energy dense foods their most viable options. (12) There may also be a link between the vulnerable situation of scarcity and the impulse to overeat. (13) Aboriginal Canadians have high rates of obesity and food insecurity. (14) Rural areas also have significantly higher rates of obesity and food insecurity than large urban areas. (15) In addressing obesity in Canada, targeting populations that have higher rates of obesity and ensuring the methods used to reduce obesity used are effective for them will result in more effective strategies.

Agricultural Subsidies

In considering price interventions, it is important to consider how the market has been skewed by agricultural subsidies. (16) The most highly subsidized agricultural commodities in Canada are corn, soybeans, tobacco, beef, sheep and milk. (17) Agricultural and agrifood expenditures in Canada are approximately $8.4 billion. (18) The agricultural support system grew out of the post-WWII world when European and North American governments became focused on producing large quantities of affordable food. (19) As a result, the American food supply provides 3 900 calories per day per person. (20) One study found that the Europe Union's common agricultural policy results in the deaths of 9000 people a year due cardiovascular causes and stokes. (21) Similar consequences may result in Canada from agricultural subsidies.

Corn and soybeans in Canada receive large subsidies and are used to produce energy-dense foods. (22) In the United States, similar subsidies have resulted in 4 million more acres of land being cultivated in corn. (23) The result of these subsidies on final product prices is debatable. One opinion is that without these and similar subsidies, the price of a fast food meal would triple. (24) However, research done for the National Corn Growers Association found subsidies have little effect on final prices. (25) Even if subsidies do not greatly affect the price of energy densefood products, they do encourage overproduction and overconsumption.

Price Interventions as Public Health Regulation

Price interventions could take a number of forms, including taxes based on nutrient composition (i.e. a fat or calorie tax), product based taxes (i.e. a junk food or soft drink tax) or subsidies on fruits and vegetables. The purpose of such measures is to help individuals internalize the true cost of what they eat, make healthy foods more affordable and unhealthy foods more expensive. One way to justify a price intervention is as a public health measure. Public health is a communal good. (26) Numerous factors that contribute to obesity are communal in nature and not specific to individuals. As a large part of the problem is communal, part of the solution must also be communal; policies based on individual willpower and knowledge are not likely to be effective alone. (27)

One way to justify a public health intervention is the harm principle. The harm principle examines when the government can intervene, against an individual's will, to reduce harm. Its use is controversial where competent adults are posing a risk to themselves instead of society as a whole. (28) But the harm principle also provides for protection of those who are vulnerable. (29) This vulnerability may result from numerous sources, such as: inadequate information, inability to process complex scientific information, limited willpower of individuals and social, economic and environmental constraints. (30) Children are also considered vulnerable parties. (31) Most adolescents in Canada choose food without regard to what impact it will have on their health and their choices are increasingly unhealthy. (32) Obesity in...

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