Soda Tax Will Not Reduce Obesity or Pay For Healthcare Reform

The president is now considering a tax on sugary soft drinks (a “soda tax”), ostensibly to improve U.S. healthcare by focusing on “preventive care,” in this case, by mitigating obesity, a leading global healthcare concern. The real motive behind the tax is to partially offset the cost of the president’s healthcare reform plan. Ironically, Americans have gotten fatter over the decades by disregarding their expanding waistlines and the government’s soda tax idea is borne out of a necessity to reign in its steadily expanding fiscal waistline. However, much like curbing obesity itself, the government’s fiscal problem will not be quickly and magically fixed, especially with the imposition of one seemingly innocuous tax. Preliminary estimates are that a soda tax will raise a very small fraction of the billions of dollars that the president’s healthcare reform plan will cost.

The soda tax also lacks the fizz to address the obesity problem. Although high caloric intake is probably a major cause, soda is hardly obesity’s biggest culprit. Why single out sugary soft drinks? What about all those salty snacks and sugary junk food that all that soda washes down? Why not tax them all?

What about taxing our sedentary lifestyle? Lack of physical activity also contributes to obesity. These days most of us work with our heads, not our hands, and rely exclusively on motorized transportation even for our most trivial trips. Maybe we should consider taxing white collar jobs and local transportation.

Why not tax leisure activities that encourage us to become TV couch potatoes and provide the venue for consuming all of the aforementioned soda and junk food? What about taxing fast food vendors whose TV commercials encourage us to eat junk food? Or TV commercials generally, which cause us to eat out of boredom? What about taxing the video games or the Internet that keep us from physical exertion on weeknights, weekends and days off? Furthermore, the combination of no physical exercise, passive pastime activities and all those snacks before bed undoubtedly keep us from a good night’s sleep, which also promotes obesity. And, thanks to modern air conditioning, we don’t sweat or shiver nearly as much as we used to, which keeps us fat and happy. Does anyone want to tax air conditioners?

Smokers who quit smoking have been known to gain considerable weight, yet we continue to tax tobacco products heavily to discourage their use. Is getting sick from obesity, say diabetes or heart disease, preferable to getting lung cancer?

Discouraging the consumption of sugary soft drinks through taxation is obviously a political expedient for raising money for the president’s healthcare plan, and is hardly a credible starting point for fighting the ubiquitous, seemingly inexorable, yet theoretically preventable, obesity problem we face. If the Obama administration is serious about discouraging obesity-prone behavior through taxation, it should at least present a more consistent, if not comprehensive, approach by considering taxing some other behavior contributing to the global obesity pandemic.

But, not so fast! Before we go too far down that road (or on that slippery slope) we should consider whether mitigating obesity by taxing bad behavior is worth having the government micro-manage every aspect of our lives. For example, do you want our government to have the right to discourage our American idles from watching “American Idol”?

Obama’s Presidency -- a Gift or a Trojan Horse for America?

At the president’s inauguration some members of the mainstream media fumbled to find words to capture the momentous occasion. Many compared the event to a coronation of royalty and went so far as to compare the inauguration to the Second Coming. Some commentators saw the new president as a divine gift sent to save America and the entire free world. That gift may turn out to be somewhat of a Trojan horse.

In his inaugural speech, the president extended himself to our enemies by saying "…that we will extend a hand if you are willing to unclench your fist." His statement was conciliatory and firm and we all hoped it would begin a peaceful dialogue with those who would do us harm. Our president may truly believe that he can talk our enemies out of killing us, and I give him credit for trying. Unfortunately, to buy into the president’s approach we must believe that we can rationalize with terrorists who think little of killing themselves, let alone us. We must also believe that our enemies hate us because they hate Republicans, former President Bush and/or America’s attitude and behavior toward the rest of the world in recent years. However, terrorists have been trying to kill us long before anyone ever heard of George W. Bush. Remember the botched attempt to blow up New York’s World Trade Center in 1993, during the Clinton administration?

My real concern is not that President Obama seeks to talk to our enemies but that he seems to be signaling his intent to dismantle certain elements of the national security infrastructure that arguably kept us safe since 9/11. Thankfully, the president now seems to appreciate the actions of his predecessor concerning national security and is moving cautiously in implementing changes. However, proposing cuts in national defense spending and eliminating enhanced interrogation techniques make me wonder if the president is taking national security just a little less seriously than he should. The president seems preoccupied with securing the civil rights of terrorists when his objective should be to keep us safe. While those two objectives are not always mutually exclusive, they do compete and giving weight to the former is likely to hinder proper execution of the latter at times. We need to know that our interests will come first next time we’re attacked.

It is impossible to prove that the methods and tactics employed by the Bush administration kept us safe, but it is at least heartening to know that none of the more than 11,000 terrorist attacks (and more than 14,000 deaths) that took place worldwide since 9/11 occurred on American soil. It is equally impossible to claim that the absence of terrorist activity in the U.S. under this new administration thus far proves the success of the president’s approach. In fact, contrary to Joe Biden’s assertion during the presidential campaign, it is plausible that our enemies will choose not to test our new president’s mettle early in his administration. Why should they? If they believe the new administration will relax national security measures, even slightly, going forward, they would be wise to bide their time for a few years, and attack us later when we least expect it.

Citi Field Is No Substitute for Shea Stadium

My neighbor Jeff returned from his annual spring weekend in New York City with nothing good to say about Citi Field, the New York Mets’ new stadium. You need to understand the significance of his commentary. Jeff loves the Mets even more than the game of baseball and makes Seinfeld’s Mrs. Sokol look like a fair-weather fan. Mrs. Sokol may have watched every inning of every game played by the ’86 Mets, but Jeff has been a fan through thick and thin and has personally endured their agony and ecstasy over their 47-year history. If the new stadium didn’t impress him, who’s going to be impressed?

Jeff complained about the fact that the new stadium’s Jackie Robinson Rotunda pays tribute to New York’s National League roots, but pays no homage to the Amazing ’69 and ’86 Mets, Tom Terrific (Seaver) or any other stars of its story book past. Notwithstanding the venue’s physical superiority to Shea Stadium in so many technical ways, it falls short on a few features that matter most to fans. First, athough the seats themselves are two inches wider than the old ones, they number 15,000 fewer than in good ‘ol Shea. Second, while seats may be more spacious and provide more leg room, their relative comfort is debatable as their slight alignment toward home plate makes viewing the whole field more of a chore for even the most physically dexterous. Finally, the new venue has several blind spots obscuring the view of the action on the field from most seats, even apparently from those in the press box. For true fans that go to the ballgame to actually see the game, such tangible shortcomings cannot be compensated for with a larger team store, more luxury suites, and more restaurants. However, even Jeff would agree that all fans will benefit from more elevators and more toilets (per seat) that the new venue offers. Jeff shared his views with his friends attending the game with him, and given the reaction of fans seated around him listening to the conversation, Jeff’s sure many others share his disappointment.

How could that be? The new $900 million stadium was designed by HOK Sport, the internationally renowned architectural firm. HOK Sport has designed and renovated 13 of the 30 major league ballparks in use today and seven of the last eight to open in Major League Baseball. Shea Stadium cost less than $30 million to build and even though that was real money nearly 50 years ago, dramatic improvements in both technology and building materials since then should have guaranteed a physically superior stadium in every way. Also, thousands of people were involved for years with the planning and development of the new stadium. Didn’t any of them ever go to a ball game? The New York Mets will be paying the bulk of the tab for Citi Field until the cows come home in the form of principal and interest on the $850 million in municipal bonds issued to cover most of its construction cost. I hope at least they’re happy with their new home.

New Yorkers are among the world’s greatest baseball fans, but they are also among the least forgiving. I have little doubt that by the end of this inaugural season Citi Field will have many new nicknames. The most obvious will come from an unflattering mispronunciation of its first syllable from a “C” sound in "Citi" to “Sh.” Some may say the mispronunciation incorporates the memory of old “Shea,” but most will know that the deliberate mispronunciation more aptly captures the fan experience at the new stadium.

U.S. Supreme Court Needs Justices with Proven Capabilities and Integrity

Senate Majority Leader Harry Reid was recently asked who he thought President Obama should select to replace retiring Supreme Court Justice David Souter. In his reply he indicated that the list should not be limited to candidates with experience as judges. Senator Reid also said he preferred someone from the real world and not someone who had spent most of their career among others who wore black robes. Many other democrats have indicated a preference for a candidate who will empathize with disenfranchised Americans and bring a sense of fairness and social justice to the position. Still others think that diversifying the bench by adding a woman, a Hispanic and/or perhaps even an Asian should be an important consideration. We know for sure the appointment will be political, as it always is, and given the president’s political leaning, the nominee is likely to come from the liberal camp.

All of those considerations notwithstanding, isn’t the job of the Supreme Court to interpret the Constitution of the United States? Shouldn’t a nominee’s proven ability to do that be the starting point for the selection process? I would have thought that a nominee with background as a judge would have a decided advantage for such a job. He didn’t say but I wonder if Mr. Reid would concede that all prospective nominees should at least be lawyers. If recent history has taught us anything it's that we really shouldn’t take anything for granted.

We elected an inexperienced president with an unproven track record. Taking our lead, our new president promptly nominated many individuals for his cabinet that lacked experience and gravitas for their respective positions. However, the nominees that failed their confirmation hearings did so not because of those professional deficiencies, but because they had legal, tax and other skeletons hanging in their closets that caused even the most unassuming among us to question their integrity. Before this year, would anyone have believed that a proven tax cheat would be in charge of the U.S. Treasury, the agency that oversees the IRS? Although unquestionably the most egregious example, it’s only one on a shamefully long list of questionable nominations. Why assume this time will be different? We elected a president who had been barely a senator. It’s certainly plausible that he could appoint a Supreme Court Justice who was barely a lawyer.

Harry Reid ended his interview on the topic saying that he thought that the President’s selection to the Supreme Court would be as good as the men and women he selected for his cabinet. That’s what worries me.

Exploding U.S. Debt May Haunt Us Forever.

Sometimes I imagine our President many years in the future, sitting at a desk in the oval office early in the morning softly singing a particular refrain from the tune “Paradise by the Dashboard Light.” The President rewrites the words to secretly confess a pressing desire: “So now [we’re] praying for the end of time to hurry up and arrive cause if [we] gotta spend another [dollar on debt] I don’t think that [we] can really survive. I’ll never break [our] promise or forget [our] vow, but God only knows what [we] can do right now. [We’re] praying for the end of time, it’s all that [we] can do. Praying for the end of time, so [we] can end [our debt] with you!

The media pundits debate the outlook for our future if our spending continues out of control but the cold hard reality is that our Government’s debt has already grown to an unfathomable level. One source estimates that current and future obligations of the U.S. Government, including social security and medicare payments, exceed $65 trillion. That is 65 with twelve zeros after it! It’s also more than the entire world’s GDP and more than four times our own. The Congressional Budget Office (CBO) projects our national debt to rise $9.3 trillion in the next ten years under team Obama, and some have estimated that the average 20 year old today will pay $114,000 more federal taxes during his/her working life just to pay the interest on that incremental increase. Can you imagine the total interest that debt will produce? Can you imagine actually trying to pay back the principal?

I agree that worrying about budget deficits while the world faces economic Armageddon makes little sense. However, our critical need to spend, and spend big, at this time should be tempered with at least some acknowledgment that an 800-pound gorilla of a national debt threatens to crush our economy for at least many generations to come, if not bankrupt us once and for all.

Now may not be the time to attack this problem, but our leaders better make it a serious priority soon. Having the Obama administration cite its intention to cut our budget deficit in half in five years when it knows full well that during that same period our total debt will grow $4.6 trillion is, to say the least, disingenuous. Further, Obama announcing a measly $100 million budget cut when apparently many on both sides of the aisle in Congress agree that more than $300 billion of unworthy projects is just begging to be cut immediately is insulting to Americans and should embarrass our leaders.

No one is suggesting that the solution to our growing debt problem will come easy. Even world-renowned economist, John Maynard Keynes, could offer little solace back in the 1930s Great Depression when asked about the long-term effects of higher deficit spending. His glib answer then is the now famous quote: “In the long run we’re all dead.” That’s not much of an outlook for the future and it certainly isn't change we can believe in.

Will Chrysler’s Bankruptcy Uphold the Rule of Law?

The President recently announced that despite the Government’s best effort to save Chrysler from bankruptcy, greedy bondholders are forcing a bankruptcy because they want a better deal. Once again, the President mischaracterized reality to suit his own political agenda. He claimed that certain bondholders refused to make sacrifices that other stakeholders did. He did not tell us that those bondholders were put off by the fact that the Government proposal offered them less than 30 cents on the dollar, some $2 billion in cash for their nearly $7 billion investment, with no equity stake in the new company. He also conveniently omitted that the autoworkers union (UAW) would receive half of the value owed it in stock of the new company and would become New Chrysler’s majority stakeholder. Does it really make sense to reward the guys (the union) who significantly contributed to Chrysler’s demise in the first place by giving them a huge stake in the new company? Isn’t it just a bit sneaky to completely ignore the fact that in bankruptcy bondholders would be among the first to be paid and probably walk away with substantially more than 30 cents on the dollar-value of their investment?

The major issue isn’t the obvious unfairness or idiocy of that proposal. It is about the Government using its discretion to change the way business is done America. Politics clearly played a key role in formulating the Government’s proposal to save Chrysler. The autoworkers union and others were a significant factor in electing President Obama and it is obvious that he was attempting to reward them for their support. It will be interesting to see if those politics play a part in structuring a deal in bankruptcy. If it does, the deal’s ramifications will extend well beyond its impact on the parties to the struggling automaker.

American business thrives because it relies on the rule of law and the sanctity of private property rights and private contracts. Throughout our history, through thick and thin, that system and its precedents have provided a framework of predictability, certainty and impartiality to the way business is done here. It has also been a major reason why foreigners and Americans alike would rather do business in America than anywhere else on the planet.

The world’s major governments were justified in intervening in private industry in an unprecedented manner during past two years in order to save our global financial system. However, they may have now overstayed their welcome. Either way, America will need to know how Government intends to proceed going forward. The Government has already become ensconced in our financial system and because of its demonstrated ad hoc and lacking management approach, there is a growing reluctance among private investors to collaborate with it to recapitalize the banks. Investors are quite rightly concerned that submitting to an investment program where our Government changes or makes up the rules as it goes along presents risks that outweigh even the most attractive of returns expected from the public-private partnership to purchase toxic assets from the banks. It is also clear that the Obama administration plans to replicate its onerous management format in order to play a major role in our energy industries and healthcare system going forward. You can bet those efforts will be met with a similar lack of enthusiasm, skepticism and confusion by the private sector.

The Obama administration may truly believe it is implementing change we can believe in, but it is rapidly becoming change Americans cannot invest in.