Jamie Oliver is a machine….he is one mad food revolutionary. His results from food change programmes in the UK have been tested and shown to raise educational standards….intuitively we know this but it’s very affriming to have some research to back it up.

Now he is taking his personal brand of straight talking to the heart of America’s chronic food related problem, Huntington, West Virginia. This five county metropolitan area was designated as the unhealthiest city in the nation. Nearly half the adults in the area are obese with heart and diabetes problems running alongside.

It’s tough love all the way from the Essex Crusader who keeps giving us the harsh cold truth: crap in, crap out.

Maybe we need him down here in NZ….

I’m just back from 3 lovely days in Wellington (nice weather for a change!) at the NZ Association of Economists Conference. It had a good vibe and felt like there was a wider range of interesting papers than the last one I attended. The topics of interest for me are listed below (I will post in more detail once the papers have been uploaded to the NZAE website):

- Tax Reform: The perennial favourite, Capital Gains Tax, made some waves as did some more detailed examination of a possible Land Tax. This initially popped up 18 months ago as a floated idea and more recently was discussed at length over at Interest.co.nz.  The session on Tax Reform was sponsored by the Treasury so expect more debate on this in the near future.

- Aid and Development: There were a few papers on corruption and developmental outcomes which were worth following (though I haven’t seen anything to rival Paul Collier’s work). I especially enjoyed a paper on whether aid was helping to achieve the Millenium Development Goals. To me it was clear that whilst aid can make some contribution, targeted p2p actions such as microfinance and giving are more likely to have a lasting impact as they tunnel through the swathe of government and administration on both ends of the aid pipleline. Message to Government: Let people do the giving.

- Business and Innovation: It’s good to see economists looking at this topic since it’s of major importance to NZ. Again lack of capital and R+D incentives for business was a clear problem. We simply can’t compete with countries like Finland or Israel when all our capital is tied up in housing.

- Health: One good paper on “fat” taxes or food “subsidies”. It simply reinforced my position of taking a supply side approach. It’s hard to influence demand through pricing strategies when the underlying commodity (food) is experiencing huge swings in price. As with oil and carbon taxes, the prices movements in food prices will overwhelm any attempt to reduce demand by taking away GST for example (12.5%). Perhaps incentives like gift vouchers/cash in savings accounts will help focus (a bit like the idea to pay girls an annual stipend for each year they don’t get pregnant). We have to get our future health costs down somehow and creative solutions may be required. Time to call in the behavioral psychologists methinks.

- The Financial Crisis: Nice paper looking back at financial collapses over the last 200 years. Yes they happen with regularity…..whoa…yes we know that. The cycle goes back as far as records allow. Even the Bank of England was not immune from overstretching itself… a run on the Central Bank itself. Ooops. So my simple question is: When are we going to change the system?

Overall it was a good conference and a lot came out of it. For next year I can see more focus on the impact of microfinance and p2p activities, more focus on tax reform, more focus on the debt based financial system and hopefully we will have some more ideas to contribute ourselves.

Also good to see someone with a laptop on the go! Surely a first for the NZAE.

At the beginning of the April Japan came out with a new framework for monitoring the health of its citizens over 40. Otherwise know as a “flab check” it puts health insurance companies on notice to improve the physical welfare of its customers. You wouldn’t think Japan has a serious problem here but clearly the government does.

The analysis of the regulations shows an upward trend for obesity and metabolic syndrome with the accompanying costs. Japan already has a monster pension bill looming and health is just another area marked for a major budgetary blowout.

Health and nutrition are issues that governments have started to become very involved in. This leads us to the question of how far should governments go in their desire for us to have a healthy life. I would say not too far actually.

More and more the government is taking on people’s personal issues. This approach by the Japanese sets a dangerous precedent. It is against the law to hit your children but it isn’t against the law to be overweight or obese. Should the government attempt to intervene or leave it to the market?

By the market I mean the price mechanism as well as social incentives. The price mechanism can regulate food to some extent and also body mass (more expensive seats for larger people). Carrying a lot of extra weight can hurt in the pocket not just in the heart. Socially it can be difficult also with discrimination and exclusion from others.

The answer is not clear. Clearly something has to be done but are we prepared to do the hard yards (better diet and proper exercise) or wil lwe rely on the government to bail us out.

It will be interesting to see how this policy develops.

It seems crazy that in a time of increasing obesity and poor nutrition that we still tax basic raw food. So people keep consuming highly processed junk which they claim is cheaper than good old fruit and vegetables.

A food researcher from Massey University has asked for GST to be removed from fruit and vegetables.  This is a step in the right direction at least. It will not cause a sudden shift in diet…let’s face it it’s hard to come off a high sugar and salt diet but at least it will start to compete on price terms.

How the government can continue to justify this tax is beyond me. But given that the whole tax system is dysfunctional that is hardly a surprise.

Obesity, alcohol and smoking are 3 serious health issues that many countries are struggling with. A rather interesting and challenging proposal has been put forward by Julian Le Grand, a former Blair advisor, which has been dubbed as “libertarian paternalism”.

It’s kind of kooky but has some merits once you wade through the initial reactions. The idea of getting a permit to smoke is not likely to win much support but what it does is create an extra layer in the choice process. If we assume that people are not rational actors (opposite to received economic theory) then asking them to consider the choice before they make it may have some merit.

This is a similar approach that I have often thought might work with drugs, namely that you have to apply for a permit to gain access to the required drug from a doctor. Implicitly this means rocking up and saying yes i’m an addict and a need a prescription. You then get your drug for example heroin, which would be pure and therefore less harmful, from the medical authorities.

We know what a healthy and balanced lifestyle looks like but for many that is a pipe dream. Could this proposal help or is it just another bad idea with good intentions?