Obama’s former chief economist Larry Summers thinks that one way to break America’s fall off the over-reported fiscal cliff is to raise taxes to the level they were under Clinton’s administration. Echoing Paul Krugman’s 90% tax rate nostalgia and pointing out that it was conservative icon Ronald Reagan who cut taxes to 50%, he said, “It’s hard to believe that raising the top tax rate to 39.6 percent — where it was under President Clinton — will do grievous damage to the economy.” Of course, Reagan also cut the top tax rate to 28% in his second term, but that’s beside the point.
Raising already existing taxes is only one way to cushion our fall. Summers, a professor at Obama’s alma mater, is certain that soon we’ll have taxes on carbon, energy and junk food. In fact, he was surprised that Americans didn’t yet have a tax on carbon and energy, considering that carbon and energy usage is directly related to the solar cycles that affect global temperatures. Or so liberals think. Taxing such usage will surely convince the sun to alter its behavior so that the average global temperature will go down a couple degrees and stop all the hurricanes from ruining everybody’s lives. And if taxing doesn’t work, just tax more.
As for the junk food tax, Summers cited evidence that tobacco taxes directly correlated to decreases in tobacco-related deaths. He said that 700,000 fewer deaths per year were reported as a result of tobacco tax increases. Based on those data, he extrapolated that the same would happen if we taxed certain junk foods. Since diabetes and obesity are linked to eating sugary and/or fatty snacks, he reasoned, maybe a tax on those items would discourage people from buying them, thereby decreasing the number of people affected by nutrition deficiency diseases.
The government can pretend to care about people affected by those diseases, but raising taxes won’t do much. If they really cared, they’d stop subsidizing food crops that contribute to obesity and diabetes. Food companies use those foods not because of popular demand, but because the government makes them literally dirt cheap. The government dumps billions of dollars into the production of wheat, corn and soy, from which food manufacturers derive all sorts of additives, preservatives and super sweeteners that all contribute to the diseases that Larry Summers pretends to care about. If the government wants to stop people from smoking, then why does the government subsidize tobacco? There should be no need to tax it. Just stop subsidizing it at least.
The Washington Post pointed out that taxing junk foods would only prompt people to find it elsewhere where it isn’t taxed. Americans may just go to Canada or Mexico if such a tax were levied in the U.S.:
“As a way to promote a healthy diet, Denmark levied a special tax on foods like cheese, butter and bacon that had more than 2.3 percent saturated fat. Danish consumers reacted to the tax as rational global consumers would — they drove to Germany and other tax-free locations to buy their junk food. Realizing that the tax was simply shifting consumption out of Denmark rather than reducing consumption, the Danish government scrapped the tax effective January 2013. “
I don’t like that they call cheese, butter and bacon “junk food.” Fat is not the culprit. Excessive sugars and refined carbohydrates are the problem. And this is why we should be wary of the government deciding what “junk food” is. A couple years ago, it was reported that the psychiatric industry had invented a new mental disorder called orthorexia nervosa. This “disease” was characterized by wanting to eat only whole, natural foods and avoiding real junk foods.