Looking at problems from another angle

Two stories in today's NYT that deal with different but important issues, but take an approach to them that differs from what Congress is debating.

First is an op-ed piece by Micheal Pollan, a healthy diet guru who has authored several books on the crap that we eat. He would like to see the horrible diet of Americans added to the health care debate. In particular, he is rightfully upset over the fact that our tax dollars subsidize the production of corn, which becomes high-fructose corn syrup, which is incredibly bad for us.

But so far, food system reform has not figured in the national conversation about health care reform. And so the government is poised to go on encouraging America’s fast-food diet with its farm policies even as it takes on added responsibilities for covering the medical costs of that diet. To put it more bluntly, the government is putting itself in the uncomfortable position of subsidizing both the costs of treating Type 2 diabetes and the consumption of high-fructose corn syrup.

Clearly, eating better will not cure all the ills of our health care system, but it sure would help. We subsidize corn, which is not good for us, but not broccoli. In other words, our tax dollars go to making us less healthy, which then costs us more in health care. Could we be more stupid?

Meanwhile, Congress is also debating a "cap and trade" system to reduce greenhouse gasses that cause global warming. A story in the Times business section notes that some countries in Europe, which has had a cap and trade system for several years, are now considering taxing carbon emissions directly instead. The first line in the story says it all:

Economists have long seen a carbon tax as a good idea because of its simplicity: Polluters pay at a level that is set by decree.

It is clear that a tax is a much more fair and simple way to decrease carbon emissions than cap and trade. But since merely saying the word "tax" will cost an American politician his next election, we will instead get a costly, ineffective, and probably corrupt system instead. And it will allow politicians to give out the right to pollute to the industries in their districts. We need to realize that "TAX" is not a bad word when placed on something that is clearly bad for society (we call that "negative externalities" in econ talk!).