MONTHLY BAROMETER: WELLNESS EDITION
A Future Where “Fat” is Fined
By Thierry Malleret, Co-Founder, The Monthly Barometer
Quantitative easing (QE) is a monetary policy used by central banks to stimulate the economy by buying financial assets from commercial banks and other private institutions to lower interest rates and increase the money supply. And QE performs a special trick: it transforms monetary policy into a fiscal policy tool. By compressing interest rates and yields, it penalizes savers and pension funds—the equivalent of a tax on investors and a subsidy to borrowers. In consequence, the frontier between monetary authorities and publicly elected leaders is getting blurred. The ultimate lesson is this: In today’s world, it’s not the markets that call the shots—governments reign supreme!
This offers an easy link to our much-loved theme of wellness being declared “compulsory” by governments as their fiscal positions no longer enable them to cover rising healthcare costs in a rapidly aging and over-indebted world.
Moral considerations aside, opponents to the idea of legislating away ailments such as obesity often refer to the example of Denmark. It was one of the first countries to take a stab at obesity when, in 2011, it enacted a tax on foods containing more than 2.3 percent saturated fat. After just one year, the authorities abolished the tax (and cancelled a planned tax on sugary foods) after realizing that the law did more to inflate food prices than it did to “deflate waistlines.”
This is the wrong analogy. Eventually, governments will go further than merely implementing a tax because the pressure that obesity and other conditions of “un-wellness” impose on the fiscal balance of most nations around the world will become unbearable.
In the U.S. for example, back in 2010 the cost of obesity was estimated to amount to $316 billion for medical care alone, without including the associated direct and indirect costs of reduced productivity, wider gender and income inequality, and even higher transportation costs.
In the future many countries will go as far as the “politically incorrect” proposal made by Senator Gilbert Rodriguez Valle of Puerto Rico. He just introduced a bill that would establish a process of identifying obese children in school and sending social workers to investigate the families. If the social workers see no improvements after a year, the parents could be fined up to $800.
ABOUT THIERRY MALLERET
Thierry Malleret is the co-founder and primary author of the Monthly Barometer, a predictive analysis provided exclusively to private investors and today’s most influential opinion and decision-makers. Previously he was a senior partner at IJ (Informed Judgement) Partners, an investment boutique for ultra-high-net-worth individuals based in Geneva. Thierry also founded and directed the Global Risk Network at the World Economic Forum (WEF), bringing together top policymakers, CEOs and academics to consider how global issues will affect business and society in the short and long term. For a number of years, Thierry conceived and implemented the WEF program at Davos. He holds MAs (in economics and history) and a PhD in Economics. He writes a Wellness Edition of his Monthly Barometer, exclusively for the Global Wellness Institute. For a copy of the full report, join the GWI as a Member or Ambassador.
One thought on “Which Governments are Beginning to Legislate against Unhealthy Behavior?”
Thanks, Thierry, for all the good info and insight. If Denmark can’t manage to succeed with anti-obesity legislation, government-directed change will be a glacial, agonizing process. As with big tobacco before them, junk food manufacturers and retailers are well aware of the health perils, in fact worked in the ’40’s and ’50’s to help create them. Perhaps gov’ts can begin by penalizing "Big Bad Food" and mandating educational campaigns, label warnings, et al. Following the money trail might be a worthy start.