IEA release new book on the flaws of paternalism
Punitive sin taxes, advertising restrictions, smoking bans, minimum pricing and other forms of paternalistic regulation raise costs for consumers and force them to make sub-optimal choices.
Health is not a public good and, in their desperation to secure policy goals, ‘public health’ campaigners are reluctant to acknowledge both the benefits of people’s lifestyle choices and the costs of their own policies.
Snowdon argues that paternalistic measures infringe on autonomy, deprive the individual of choice and drain markets of competition. People have different tastes and preferences. If the state prevents individuals from doing what they most desire, it can only make society worse off.
The consequences of paternalism:
Higher costs for consumers – punitive sin taxes on food, alcohol and tobacco are regressive and far exceed the alleged costs of unhealthy lifestyles.
Substitution effects – consumers bypass excessive taxes and regulation by buying inferior goods, thus reducing their consumer surplus.
Fueling of the black market – illicit trade depends on prohibition, over-regulation and excessive taxation. By banning or heavily taxing products, ‘public health’ campaigners inadvertently force people to move from a safe, regulated product, to an unsafe, unregulated product – thus reducing the individual’s welfare and endangering their health.
Loss of information for consumers – advertising is not coercive, but a ban on advertising is legal coercion that infringes the rights of business to tell consumers about their products and prevents consumers from acquiring information. It also keeps out new entrants to the market, prevents competition and therefore raises prices.
Costs of implementing ‘public health’ legislation – the ‘public health’ industry imposes a large and growing tax burden on taxpayers.
Poorer health – there have been several examples where paternalistic policies have been actively damaging. For example, the banning of e-cigarettes in some countries removes an option for smokers who might otherwise quit.
Instead of dictating how people should live their lives, the aim of policy should be to ensure people can make informed decisions as freely as possible.
How lifestyle products should be regulated
- Education and labelling – to the extent that they inform consumers, not deter purchase.
- Taxation – to cover the costs borne by third parties only.
- Controls on sale – only to the extent that it protects children and do not negatively impact adult consumers through restricted choice and raised prices.
- Advertising – should be truthful and restrictions should be lifted to encourage competition and lower prices
Commenting on the book, author Christopher Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs, said:
“It’s easy to dismiss ‘nanny state’ regulation as a minor nuisance but the underlying paternalism of those who wish to regulate our lifestyle raises fundamental questions about the limits of government intervention. It is an issue about which social liberals and market liberals should be united in opposition. My new book, ‘Killjoys’, shows that the modern ‘public health’ movement is a form of coercive paternalism that is little different to the moral crusades of earlier eras.”
Notes to editors:
For media enquiries please contact Nerissa Chesterfield, Communications Officer: [email protected] or 020 7799 8920 or 07791 390268
‘Killjoys’ will be launched tonight at an event in central London. If you would like to attend please contact Nerissa Chesterfield as above.
To download a copy of ‘Killjoys: A Critique of Paternalism’ please click here.
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems and seeks to provide analysis in order to improve the public understanding of economics.
The IEA is a registered educational charity and independent of all political parties.