Today’s Menu: The Carrot and the Stick

By Krist Novoselic

July 21, 2013


 

An, October 1, 2010 CQ researcher article by Barbara Mantel looks at how government seeks to remedy the current obesity epidemic[1]. Instead of attributing the condition to self-indulgence, researchers have identified the “obesogenic” environment. The article says Americans are eating in an atmosphere, which “promotes increased portion size, non-healthful foods and physical inactivity” (p. 797). The Obama administration and various state and local governments are implementing and designing programs for incentives and regulations to curb the epidemic. Government not only seeks change in the eating habits of individuals, it has its sights set on transforming the food system / industry.

 

With a rather delicious pun, the state has various carrots and sticks among its policy proposals regarding influencing eating habits. Deborah Stone, in her book Policy Paradox tells us this famous metaphor is about positive and negative incentives (p. 277). Regarding positive incentives -the carrot-, the federal government is offering cash for supermarket chains to open stores in so-called food deserts (Mantel p. 802). These areas are low-income neighborhoods with only convenience stores and fast food restaurants serving high caloric, low nutritional food. The policy goal is for large grocery stores, with their produce sections, to sell healthful food. This incentive is a metaphorical carrot seeking to produce the real thing.

 

Like kids in a candy store[2], government handing out positive cash incentives can foster goodwill and alliances (Stone p. 277). These incentives can create bonds of loyalty, where the target grocers can feel an obligation to meet the goals of the program. On the other hand, negative incentives create a climate of conflict – this means things get political.

 

The perfectly precise rule spells out all the circumstances to which it applies (p. 297). Stone says this is an unattainable ideal. To paraphrase her Plato quote, it is like, “A legislator sitting at one’s side prescribing particulars.” This may be impossible as an ideal, however, as a policy, such is considered for regulations on food ingredients. The Children’s Food & Beverage Advertising Initiative (CFBAI) seeks nutritional standards with advertised processed foods (Mantel p. 806). Experts cited in the CQ article who are critical of the standards do indeed see the proposed CFBAI standards as impossible; as food companies would need to come up with new children oriented products to meet the standards. Noncompliance would result in foodstuffs not being advertised. This is a negative incentive – a whack from a big stick. It should be no wonder that food companies are resisting. If these rules are implemented, marketers will have to change or risk being displaced by competitors who perfectly and precisely comply. It comes down to the rational choice of surviving as, “advertising is how products are sold in this country” (p. 807). Stone says rational choice theory rests on the utilitarian model of human behavior (p. 272). This model states that humans are adaptable, and if the standards are implemented, change among producers will likely happen with the policy goal of healthful food / less obesity closer.

 

Rational choice among consumers, is at the center of taxing sugar sweetened beverages. Policy designers are keen to the distinction between excise and sales taxes. They say the excise tax is an effective incentive because the price is visible “on the shelf” where the consumer makes their rational pecuniary choice, instead of at the cash register where the tax / punishment is paid after the purchasing decision (Mantel p. 803).

 

Another consumer oriented incentive tool to fight obesity is menu labeling. According to Mantel, Americans now consume one-third of their calories on food prepared outside the home (p. 805). The idea is to have restaurant menus and vending machines post caloric content so people can think twice about their order. Mantel quotes experts and studies that show menu labeling having a limited effect (p. 805). Stone anticipates this with what turns out to be a remarkable metaphor, “Any new incentives stand in line behind a broad array of consequences the target already faces” (p. 277). The reward to an informed individual in line at the eatery only comes after calculating calories. This is a personal cost (p. 279) in time and mental energy. In addition, there is a distance of time from the moment of choice to the weeks and months ahead of reaching a personal weight goal (p. 275). Overcoming the obesogenic environment therefore requires maintaining various types of self-awareness.

 

Policy designers themselves also need to be attentive. A look at other government programs reveal incentives at odds with fighting obesity. Mantel points to farm subsidies that drive down prices on sweetener crops like corn (p. 800). A healthy food producer, such as a carrot farmer, does not receive this incentive of economic advantage. Perverse incentives are unwittingly built into a rule to create new problems (Stone p. 305). Stone then lists such situations in the former USSR. While corn farmers in the United States are not flagrantly manipulating rules by filling freight cars with water to meet state imposed shipping weight goals, the corn subsidy is having the negative effect of making many Americans heavier!

 

Birkland points to scholars March and Simon, who recognize the limits on resources and human abilities to process information (p. 225). Their notion of bounded rationality says just that; food consumers will behave as rationally as they are capable. And like Stone says, “In many cases, new information [such as nutrition labeling] doesn’t change people’s behavior (p. 323). Eating habits were likely learned over a lifetime and altering consumption has its personal costs. Food companies have their own rational incentives to fight government policy proposals that affect them. As stated above, nutritional standards (the big regulatory stick) on advertised processed foods seem best positioned to change diets because; if advertising didn’t work, we wouldn’t be inundated by it. If these standards ever pass Congress, a resulting healthier food / media environment could decrease obesity. When and if that happens, let’s pop the corks on the celebratory carrot juice.

 

Works Cited

Mantel, B. (2010) Preventing Obesity: Do Americans face too many obstacles to healthy living? Congressional Quarterly Researcher, Vol. 20, No. 34 pp. 797-820

 

Stone, D. (2012) Policy Paradox: The Art of Political Decision Making, 3rd ed. New York, NY, W.W. Norton & Company

 

Birkland, T.A. (2011) An Introduction to the Policy Process: Theories, Concepts and Models of Public Policy Making, 3rd ed. New York, NY, M.E. Sharpe, Inc.

 

 

 

 

 

 



[1] United States Surgeon General declared obesity an epidemic in 2001.

[2] I couldn’t resist the pun!