The fat tax chimera

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A couple of weeks back I noted that Hungary’s new fat tax is unlikely to slim the populous or reduce health costs. While MacroBusiness has a wide readership, UK Prime Minister David Cameron is clearly not amongst them, as his recent suggestion of a ‘food levy’ to battle obesity suggests. Also, it was too late to convince the Danes to back out of their fat tax.

I argued that health ‘sin taxes’ are generally ineffective at fulfilling their stated aims. If the taxes change behaviour and improve health, public health costs will actually increase as people live longer during retirement. But the taxes won’t change behaviour significantly. It will simply promote consumption of close substitutes, which themselves are likely to be ‘unhealthy’.

Today I consider the implications of the uncertainty surrounding the scientific connection between dietary fat and obesity. What if the connection is not as strong as we are led to believe? What if new data proves that in fact our fat intake is too low and causing more health problems because of our relatively high intake of carbohydrates? How would policy makers deal with new scientific findings after implementing a fat tax? While I don’t have definitive answers, I can at least being the discussion.

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Given the complexity of human metabolism (I liken the body to an economy of cells interacting to form emergent complex systems) it would only be natural that our understanding, especially of long term patterns, is far from complete.

Gary Taubes’ classic article examines the uncertainty and controversy that sits just behind the mainstream dietary advice (I strongly recommend reading the article in full even if it is a little outdated)

But it gets even weirder than that. Foods considered more or less deadly under the low-fat dogma turn out to be comparatively benign if you actually look at their fat content. More than two-thirds of the fat in a porterhouse steak, for instance, will definitively improve your cholesterol profile (at least in comparison with the baked potato next to it); it’s true that the remainder will raise your L.D.L., the bad stuff, but it will also boost your H.D.L. The same is true for lard. If you work out the numbers, you come to the surreal conclusion that you can eat lard straight from the can and conceivably reduce your risk of heart disease.

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In fact a theory first promoted in 1924 by Otto Warburg (the Warburg effect) suggests that high-fat diets could play a role in prevention or treatment of cancer. His observation was as follows.

If most aggressive cancers rely on the fermentation of sugar for growing and dividing, then take away the sugar and they should stop spreading. Meanwhile, normal body and brain cells should be able to handle the sugar starvation; they can switch to generating energy from fatty molecules called ketone bodies — the body’s main source of energy on a fat-rich diet — an ability that some or most fast-growing and invasive cancers seem to lack.

Inspired by these observations, leading researchers have conducted trials to test that very theory, with promising results. Much of the research is now focused on ‘ketogenic diets’ (high fat, moderate protein, low carbohydrate), with results showing that high-fat diets may help in the prevention of numerous diseases. One prominent researcher is now advancing the theory that cancer is best analysed as a metabolic disease, with important implications for dietary causes and prevention.

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… numerous studies show that dietary energy restriction is a general metabolic therapy that naturally lowers circulating glucose levels and significantly reduces growth and progression of numerous tumor types to include cancers of the mammary, brain, colon, pancreas, lung, and prostate.

The implication for policy makers is that taxing fats, if it effectively promotes diets with more carbohydrates (and subsequently more energy), could lead to unintended consequences in terms of the incidence of cancer, and in fact of obesity itself.

So what does this mean for the policy maker tasked with addressing the obesity epidemic?

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Taubes explains some of the pitfalls-

Surely, everyone involved in drafting the various dietary guidelines wanted Americans simply to eat less junk food, however you define it, and eat more the way they do in Berkeley, Calif. But we didn’t go along. Instead we ate more starches and refined carbohydrates, because calorie for calorie, these are the cheapest nutrients for the food industry to produce, and they can be sold at the highest profit. It’s also what we like to eat. Rare is the person under the age of 50 who doesn’t prefer a cookie or heavily sweetened yogurt to a head of broccoli.

”All reformers would do well to be conscious of the law of unintended consequences,” says Alan Stone, who was staff director for McGovern’s Senate committee. Stone told me he had an inkling about how the food industry would respond to the new dietary goals back when the hearings were first held. An economist pulled him aside, he said, and gave him a lesson on market disincentives to healthy eating: ”He said if you create a new market with a brand-new manufactured food, give it a brand-new fancy name, put a big advertising budget behind it, you can have a market all to yourself and force your competitors to catch up. You can’t do that with fruits and vegetables. It’s harder to differentiate an apple from an apple.”

If the science is suggesting that high-fat diets typically lead to lower energy intake (due to satiation effects), and this is associated with better health outcomes across a variety of measures, a fat tax seems like that last this you would implement. In fact, you would tax carbohydrates if you wanted to increase the general health of the population (but not if you were concerned about health costs), which would go some way to overcoming the carbohydrate fuelled ‘empty calorie’ trend in food marketing.

Of course, that all depends on the certainty of the science. Neither tax seems particularly flexible to new scientific findings. I would argue that a policy intended to address obesity should be able to respond to the latest research findings, or indeed, participate in the research itself. It appears that government involvement in preventative health would be most effective simply through research funding and promotion of trials to better understand the long term health risk associated with dietary preferences.

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Is that enough for a political party to appear to be ‘doing something’ about the obesity epidemic? This doesn’t seem like a change at all from the status quo. However, maybe the status quo is the best option under the obvious scientific uncertainty.

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