The Australian Bureau of Statistics (ABS) released of the latest labour force data today (March…
The obesity epidemic – massive daily losses incurred while the policy response is insufficient
The Brexit issue in Britain has been marked by many different estimates of GDP (income) loss arising from different configurations of the Brexit. The media is flush with lurid headlines about the catastrophe awaiting Britain. As regular readers will appreciate, I am not convinced by any of those predictions. But as I said the day after the Referendum in this blog post – Why the Leave victory is a great outcome (June 27, 2016) – that when I tweeted it was a ‘great outcome’ I didn’t say that good would come out of it. I also didn’t suggest that it would be a short-term recovery of prosperity or that the workers would benefit. I was referring to the fact that class struggle now has a clearer focus within the British political debate. There is now a dynamic for a truly progressive leadership to emerge and bring the disenfranchised along with them and wipe out the neo-liberal hydra once and for all.” I think that is lost in this debate. When the British Labour Party claim the latest agreement will irrevocably damage workers’ rights or environmental protections they seem to be implying that they will never be in power again. No legislation or regulation is irrevocable in a democracy. But being part of the EU will always tie a nation to the EU’s rules which usurp any national interests. That is why I maintain strong support for the concept of Brexit. But amidst all these predictions of gloom and doom, I was listening to the radio last week and heard some statistics that are truly alarming. The on-going GDP losses from the obesity epidemic in the UK, which will increase over time rather significantly, are significant when compared to the estimates of GDP loss arising from Brexit. I wonder why that fact isn’t part of the daily narratives coming out from the Remain crowd to justify their view that the 2016 Referendum result should be disregarded so they can have another go at getting their own way!
Last Friday (October 11, 2019) was the annual – World Obesity Day – which is organised by a group related to the World Health Organization and the Lancet Commission. It began life in 2015.
They are revising their calendar for next year to align the initiative on a global basis so that the – World Obesity Day 2020 – will be held on March 4, 2020.
A stream of data will be provided to support the initiative including reports from the OECD and UNICEF.
The – Australian Health Tracker – is a venture of the Australian Health Policy Collaboration centred at the Victoria University in Melbourne that helps “to provide a comprehensive assessment of the health of Australians in relation to chronic diseases and their risk factors.”
It is integrated with the WHO’s global agenda to achieve improved health standards by 2025.
Last week, some Australian data came out that was pretty shocking.
1. 63.4 per cent of adult Australians are overweight (BMI above 25). The rate for children (5-11 years) is 29.5 per cent and from 12-17 years, 28.3 per cent
2. The obesity rate, defined by WHO as “as abnormal or excessive fat accumulation” (BMI aove 30), across Australia is 27.9 per cent of the adult population. The rate for children (5-11 years) is 25.6 per cent and from 12-17 years, 21.6 per cent.
3. This has risen by 27 per cent in 10 years.
4. The geographic spread is significant with some areas of the nation having obesity rates up to 50 per cent of the adult population.
5. This elevates the risk of diabetes, cancer, heart disease, dementia and a range of other major illnesses.
6. Wealthy, high income areas have lower rates – so it also becomes a class issue.
7. Key factors in the regional disparity include the lack of infrastructure to support healthier lifestyles – reliance on cars (less provision of public transport that requires walking etc); increased incidence of fast food shops and less access to fresh food shops.
Which raises the question about the causation – individual choice or systemic bias.
I obviously prefer to construct this type of issue in structural rather than individual terms and focus on the way group behaviour constrained by systemic dynamics patterns individual outcomes.
UNICEF issued a report last week (October 15, 2019) – The State of the World’s Children 2019: Children, food and nutrition report – which showed that:
1. “Australia ranks ninth in the top ten of 41 OECD and EU countries when it comes to the percentage of children and adolescents aged 5 to 19 years who are overweight, and this figure has risen 35.1 per cent since 1990.”
2. “Globally, the report finds that at least 1 in 3 children under five – or 200 million – is either undernourished or overweight.”
3. “Worldwide, close to 45 per cent of children between six months and two years of age are not fed any fruits or vegetables.”
4. “42 per cent of school-going adolescents in low- and middle-income countries consume carbonated sugary soft drinks at least once a day and 46 per cent eat fast food at least once a week. Those rates go up to 62 per cent and 49 per cent, respectively, for adolescents in high-income countries.”
5. “overweight and obesity levels in childhood and adolescence are increasing worldwide. From 2000 to 2016, the proportion of overweight children between 5 and 19 years of age doubled from 1 in 10 to almost 1 in 5. Ten times more girls and 12 times more boys in this age group suffer from obesity today than in 1975.”
6. “Even in high-income countries such as the UK, the prevalence of overweight is more than twice as high in the poorest areas as in the richest areas.”
Now all this is alarming in its own right but then once the economic dimension is added we get an additional perspective on the impacts of austerity and relative income loss.
It is clear why the media keeps focusing on GDP losses arising from Brexit – it sounds scary. The torrent of articles that appear never really qualify their reports with the obvious condition that most of these ‘estimates’ are based on economic models that failed to predict the financial crisis and/or adopt ridiculously benign assumptions about what fiscal policy makers would do in the event of a major decline in non-government spending.
Which is why the estimates that we know are wrong so far have been very wrong indeed.
But the media doesn’t accord the same focus on GDP loss arising from the structural problem of obesity.
For example, a search of the UK Guardian, which has led the Project Fear charge on Brexit, will yield few on the obesity crisis relative to the Brexit stories.
And virtually none of them will talk about GDP loss.
The UK Guardian’s most recent report (October 2, 2019) – 250 million children worldwide forecast to be obese by 2030 – made no mention of GDP losses arising from this problem despite running almost daily updates on the various GDP loss stories that one organisation or another aligned with Project Fear pump out.
Ironically, while vehemently holding out how maintaining EU membership and access to its neoliberal centrepiece – the ‘single market’ – is essential for the prosperity of the UK, the UK Guardian also ran an Op Ed story on November 24, 2016 – The obesity epidemic is an economic issue – which made it clear that “much of the rise of obesity is precisely the consequence of free-market economics”.
So privatising public transport and then allowing fare gouging to take place, while at the same time, prohibiting the renationalisation of mass transport with the provision of free transport under state aid provisions (as would be prevented under the Fourth Railway Directive of the EU), have all combined to create (or would maintain) a bias for car use over pubic transport.
That bias has been found my many studies to be a significant factor in the health crisis.
All of which brings me to the latest OECD Report (released October 10, 2019) – The Heavy Burden of Obesity The Economics of Prevention – which I finished reading over the weekend.
As a caution, the OECD invokes the usual sound finance framing exhorting us to believe that tax burdens will rise as the obesity crisis accelerates and the fiscal positions of governments are under threat as a result of the need to spend higher amounts on health care.
But one can easily cut through that nonsense and still accept there is a crisis on our hands now and will get worse as time goes by as a result of the obesity epidemic.
We learn that:
1. 60 per cent of people in the OECD nations (on average) are overweight and 25 per cent are obese.
2. 8.4 per cent of the total health expenditure in OECD nations is spent on “overweight and related conditions” – in other words totally avoidable. In the UK this figure is 8 per cent whereas in the US it rises to 14 per cent.
3. “Children with a healthy weight are more likely to perform well at school” – 13 per cent more likely.
4. “Almost two in three persons living in the United Kingdom have overweight. Nearly one in three has obesity”.
5. “While in 2010 about one in five people were obese, this has now risen to nearly one in four. About one in three children in the United Kingdom currently are overweight, and rate is higher among children with a disadvantaged background.”
Notwithstanding one’s attitude to Brexit, the data is rather compelling – the obesity crisis will be much more damaging for Britain for a much longer period than any of worst estimates of GDP loss arising from leaving the European Union.
And, given the obesity estimates are more likely to be accurate and the problem is real rather than tainted by ideological biases, one wonders why the media doesn’t push the issue more.
The worst estimates of Brexit (which are rather fanciful at best) are child’s play compared to the disaster unfolding due to obesity.
This graphic shows the average GDP losses over the next three decades arising from the obesity incidence in the UK, and other OECD, EU28 and G20 countries.
In terms of the UK specifically:
Overweight accounts for 8.4% of health expenditure; and lowers labour market outputs by the equivalent of 944 thousand full-time workers per year. Combined, this means that overweight reduces United Kingdom’s GDP by 3.4% …
The United Kingdom loses GBP 644 (USD PPP 930) per capita per year in labour market outputs due to overweight.
An earlier report (November 2014) by the McKinsey Global Institute – Overcoming obesity: An initial economic analysis – estimated that the obesity epidemic “has roughtly the same economic impact as smoking or armed conflict”.
For the UK, it estimated that “obesity has the second-largest impact after smoking, generating an economic loss of more than $70 billion a year in 2012, or 3.0 per cent of GDP”.
Major losses arise from “productivity lost” rather than outright absenteeism.
This is a major issue in terms of the challenges of ageing societies, which will require our children to be more productive than us if we are to enjoy the same material standards of living into our old age.
The obesity epidemic that is now inflicting increasing numbers of our children will mean the adult problem will increase over time, and, it is clear (from the OECD Report) that “individuals with at least one chronic disease are 8% less likely to be employed in the following year and, if employed, are more likely to be absent or less productive”.
Further, as the OECD notes:
Similarly, overweight children are less likely to perform well at school and more like to have lower education attainment later on, creating conditions leading to lower levels of human capital in the future.
In the UK, “boys were 58% less likely to have completed higher education by the age of 29 if they were obese at the age of 16. Similarly, in girls …”
Obese children “may be excluded from friendships and bullied … lower self-esteem … deleterious effects on educational outcomes”.
So while we allow this epidemic to worsen our future material prosperity (not to mention our other dimensions of well-being) are being undermined.
And then think about this in terms of the austerity bias that afflicts the European Union nations, including Britain.
The OECD Report makes it clear that:
Consistently across countries, individuals in the lowest income group are more likely to be obese … Individuals with a lower education are more likely to consume an unhealthy diet … are also less likely to be physically active …
As noted above, it is important to see this problem in structural rather than individual terms even though individual behaviour directly relates to the consequences.
Focusing on the individual behaviour will miss the structural causation that generates patterns of group behaviour that drive this problem.
Eurostat data (health care expenditure by function – shows that in there hasn’t been a significant increase in health spending as a proportion of GDP in many countries over the last 8 or so years and in many cases, this proportion has declined. For nations such as Ireland and Greece the decline is quite substantial.
In 2013, the UK was devoting 9.77 per cent of GDP to health care expenditure. By 2017, Eurostat shows it has dropped to 9.63 per cent.
This, as the obesity crisis is accelerating and the GDP losses rising.
Further, in terms of policy interventions, the OECD Report finds that the “policy response to obesity has been insufficient”.
While most governments are happy to pump out information, few have been willing to introduce policies that “modify the cost of health-related choices” or that “regulate or restrict the promotion of unhealthy choice options” in any coherent manner.
This is because they have to directly confront corporations who are happy to make huge profits by making people ever more obese.
The projected losses from Brexit that get pumped out by the Remain gang are speculative at best. There will, of course, be negative consequences of the transition, but they are finite and can be attenuated by appropriate fiscal responses.
The losses from the obesity epidemic are not speculative or ideological in nature. They are happening now on a daily basis and will get worse over time.
They are significant when compared to the worst estimates of GDP loss from the Remain camp.
While the GDP losses are significant from the obesity epidemic, the personal costs of those afflicted are astronomical.
Why is this not talked about every day in Britain and major policy interventions funded.
That is enough for today!
(c) Copyright 2019 William Mitchell. All Rights Reserved.
This Post Has 18 Comments
And how is obesity linked to austerity? As profound stress due to financial issues and all its consequences is often, not always, related to obesity.
It’s easy to say from around the world that all legislative changes are reversible and that people talk as though there will never be a Labour Government again. Well, the latter point first. There are a number of factors to say that that will be the case at least not in my lifetime; I’m 75 but I live in hope. The Tories are changing the boundaries and will reduce the number of seats, this will cost Labour. They plan to introduce photo ID, that too will reduce turnout. They’ve already made it harder to register to vote. The media, including the BBC are predominantly extreme right wing and daily pour out filth about Corbyn and Labour. The Labour Party in parliament is still mainly Blairite and neoliberal.
Onto, legislation – the big fear is the NHS. Once the US get their grubby, greedy hands onto it it will be lost forever. No British Government could take them on and take it back. I don’t care about arguments that we can afford to buy anything available in our own currency because the US will finish us off. I’m afraid that this country is finished and that although your arguments are sound about neoliberalism, the neoliberalism of the EU is preferable to that of the US. We now live in a dystopia created by Thatcher, Blair, Brown, Cameron, May and Johnson and the only political leader kicking against it is Corbyn and sadly he does not even speak for a majority in the Labour Party who would dump him this afternoon if they could. I left John Major off that list not because I’m a Tory but because he liked cricket and we would still be able to watch it on non-subscription channels if he had had his way.
We never had a proper debate from a left wing perspective about leave or remain and remainers seem to think it’s utopia. Leaving under a Tory Government will be a disaster because I don’t think Labour can ever win an election again. I hope I’m wrong.
Dear Willem (at 2019/10/21 at 7:41 pm)
1. Cutting infrastructure spending on transport – biases private car use – less walking.
2. Creating increased inequality and a lack of income growth – bias towards unhealthy diets.
3. Cutting local government services – information, assistance, local help etc.
4. Privatising public transport – allowing outrageous fares – bias towards private motor cars.
5. Defunding educational programs.
Dear Rod White,
Does Corbyn understand MMT?
If he doesn’t (and I’m sure he doesn’t) then he would not be able to achieve much in the way of reducing poverty, because his only option is to raises taxes, and most people don’t want to pay more taxes.
I have yet to see a Left Wing party actually present to the public the actual tax increases on specified upper income brackets, that would be required to eradicate poverty, given the current neoliberal “invisible hand” competitive free market orthodoxy…..I suspect politically unattractive (upper?) middle class incomes would need to be included in the tax hikes.
That’s why genuine socialists like Corbyn aren’t electable these days: everyone has fallen for Thatcher’s famous dictum (re “other peoples’ money”).
OTOH, if Corbyn had a real understanding of MMT, he could present a genuine alternative to the electorate, based on *continuous sustainable utilisation* of all available resources including labour.
But since he doesn’t, he would just end up disappointing the public like all socialists who try to function under neoliberal orthodoxy.
“seem to be implying that they will never be in power again.”
Exactly Bill !
I have beaten that drum to death and pointed out, if the far right implement 10% of their manifesto they would be voted out at the next election and via a mandate everything can be reversed. It is how Thatcher done it. It is how she changed the UK.
Support the right in taking us out. When they lose because voters have had enough of their policies. The left is then not hamstrung by the neoliberal fiscal rules. Alas, they can’t see passed their noses.
There are two fantastic articles in Spiked this morning. Thomas Fazi’s article on Italy was simply superb and well worth a read.
1. The unfinished business of St Peter’s Field
2. Boris’s ‘deal’ won’t take back control
I came across Dr Carl Baudenbacher reading the articles, a Swiss lawyer who recently resigned as president of the EFTA Court in 2017, said: ‘It is absolutely unbelievable that a country like the UK, which was the first country to accept independent courts, would subject itself to this new deal.’
He presided over 234 cases and was the Judge Rapporteur in many of the EFTA Court’s landmark decisions. He has advised members of HM Government and HM Shadow Government, members of both Houses of Parliament, the First Ministers of Wales and Scotland, members of the Irish Government and of the Government of Northern Ireland. He has furthermore given evidence to the House of Lords EU Justice Sub-Committee and to the House of Commons’ Exiting the European Union Committee.
As MMT economists have said many times before. There is more than one “Swiss Trap ” there are several ways the EU can trap independent nation states. I would urge anybody to read the Q&A that looks at how the EEA Agreement might work as a model for the UK’s post-Brexit relationship with the EU.
It is certainly not the silver bullet most people think it is. Especially the SNP they should read this very carefully. Very carefully indeed. Like I have said for the last 8 years it is all a mud bath to cloud some of the realities full of ifs, buts and maybee’s. With no clarification on issues whatsoever. A what’s the weather going to be like, as you stick your finger in your mouth and then in the air.
So how would the EEA and EFTA states and the ECJ react if Scotland joined and said it was going to run 10-15% government budget deficits ? I have asked over a 100 people this question and still can’t get a straight answer. They have no idea they cross their fingers behind their backs while they speak to you.
MMT economists knows how they would react. It would be like given points to a UK act in the Eurovision song contest.
I’ve even gave them clear evidence when Judges sitting in their own courts in their own lands have been victims of over reach of the ECJ on various matters. It is the judges themselves that say this.
Make your own mind up
The absurdity of it all rather than just allow countries to run their own affairs ties in nicely with…..
E-3/00 Kellogg’s (nutritional argument and precautionary principle in food law), court case in Denmark.
The court hereby…..
1. Declares that by applying an administrative practice which entails that enriched foodstuffs lawfully produced or marketed in other Member States can be marketed in Denmark only if it is shown that such enrichment with nutrients meets a need in the Danish population, the Kingdom of Denmark has failed to fulfil its obligations under Article 28 EC; Free movement of goods.
2. Orders the Kingdom of Denmark to pay the costs. To Puissochet, Wathelet,Schintgen, Timmermans, Gulmann, La Pergola Macken, Colneric, von Bahr Cunha Rodrigues and Rosas.
“OTOH, if Corbyn had a real understanding of MMT, he could present a genuine alternative to the electorate, based on *continuous sustainable utilisation* of all available resources including labour”
And regardless of the outcome of Brexit, Corbyn could have mounted a case to the ECB even if the
remainers won, given that we know Mario Draghi is interested.
[I’m thinking the EU could then function like a MMT-directed USA].
This is why the neoliberals keep saying when we leave there must be a
Level playing field
Level playing field
Level playing field
To stop the right cutting taxes and the left from introducing a job guarentee. To stop the budget deficits we all want.
People, do you really expect modern newspapers to behave like newspapers did 50 years ago.
Newspapers are now like Fox”News”. They are in the infotainment business now. Telling their subscribers what they *need* to know about the world is not their job. Doing that job would detract from their profitability. It seems like they must do this or go broke. There are just too many options nowadays. And people don’t like to be told things they don’t already believe.
Besides, like Bill said, obese people add to the profits of the corps. and newspapers are corps. and don’t wan t to rock the boat.
John McDonnell, at least, must understand MMT, even if he refuses to publicly acknowledge its truths. (Whereas Corbyn, I suspect, is not sufficiently intellectually interested enough to bother to engage with it).
For Labour, MMT is “the truth that dare not speak its name” (with apologies to Lord Alfred Douglas).
I have gave a signed copy of Reclaiming to Christ Williamson for delivery to Corbyn months ago. I know he hasn’t had the opportunity to hand it over. Reminds me to ring his office again.
Neil Halliday: I agree. I’m sure Corbyn doesn’t understand or even know about MMT. Corbyn is just an ordinary down to earth guy who is decent through and through. He has had so much rubbish directed at him in the past 4 years I’m amazed he even wants to carry on. The 13 page Daily Mail pre election supplement before the 2017 GE will look moderate come the next election. Anyway, whether he embraces MMT or not he can make a start changing the priorities of this sad country, if he can ever get in power. Priorities will change. Tax Havens and the taxing of Internet giants – I refuse to call them Tech companies because for me technology is something else entirely – will be addressed so as to benefit the consumer. Whether we have a government that exploits the policy space opened up MMT or not is minor compared to the drift to authoritarianism that we are witnessing with the present government. We need to stop this, draw breath and start rebuilding faith in democratic values before we can do anything else. I see that taking at least one whole parliament.
For Rod White:
I think you are being overly pessimistic based my experience from Canada. Four years ago during the federal election campaign we were fed non-stop anti-deficit drivel. The New Democratic Party (NDP), ostensibly the social democratic choice, joined the Conservatives in saying it would balance the budget. The Liberal Party of Justin Trudeau quite brazenly said it would put an end to austerity and run a substantial deficit, although the plan was to balance the budget by the end of their term in office. The Liberals won the election. Trudeau attributed his win to the promise of ending austerity and running a deficit. As an aside the NDP membership was horrified by the austerity promise that was nowhere in its platform. The leader was replaced.
Today, four years later, it is election day again. While austerity drivel has been spewed by the Conservative Party it is getting little traction. No other major party is promising to balance the budget, except bizarrely the Greens (in 5 years). The Liberals are running the biggest deficit since they were elected (1.3% of GDP) and have no plan to balance the budget. The New Democratic Party is planning big spending, also with no plans to balance the federal budget.
The difference is so striking between the two elections that even the usual buffoon-like pundits are remarking on it.
My point: it is darkest before the dawn. Do not give up hope brother.
Labour will not win a general election for a generation because of their support for the EU.
They are finished in Scotland and the North of England are ready to wipe them out. The only way from here to win is if the far right introduce their policies.
They have not learned the lesson of all left wing parties across Europe who have made the same mistakes. We are watching in real time what was explained in fine detail in ” reclaiming the state”. It is happening right on the end of our faces. Yet, some people still can’t see it.
The surrender act should be called what it is the” Benn Dover “act and the Lib Dems should rename themselves the Illiberal Technocrats.They should be prosecuted under the Trades Descriptions Act. The Greens want to implement a green new deal using 3% budget deficits. It is hilarious straight out of Monty Python.
Labour is now the M&M Party. The Metropolitan and Minorities party.
Read the title as I was opening up a kitkat chocolate bar.
Now i’m feeling guilty.
i need to decrease my snack intake.
This is just guess, since I’m in the UK & not Canada, but I wonder if this is because they (presumably) do not understand MMT concepts, and therefore believe that fiscal deficits can only be financed by “borrowing” and that means the bond markets, and they (probably rightly) view the financial markets with suspicion.
They have certainly gone against their 2017 election promise which was to implement Brexit.
After Jo Swindle’s promise to revoke Article 50 on her first day as Prime Minister, I call them the “Illiberal Autocrats”. Fortunately, she has about as much chance of being elected Prime Minister as I have of being made the Chief Rabbi of Dublin.
The extreme Remainiacs in the House of Commons are a complete disgrace: Letwin, Grieve, Swindle, Benn, etc, not to mention John Bercow, who should stop being called Mr Speaker, and be renamed the Dishonourable Member for Remain. Between the lot of them, and their allies outside in the legal profession, they have trampled on our constitution, our democracy, and the British people.
They won’t let the government govern, and yet they refuse to allow a general election. Well, we know why Labour don’t want an election. And even if Jo Swindle believes her own Prime Minister fantasies, I’m sure that more sensible heads in her party (if there are any) are a bit more realistic and know that for all their sanctimonious claptrap, Labour’s losses are not automatically going to translate into LibDem gains.
This is very interesting, Bill — I never expected my twin obsessions, inequality and diabetes (for which I take the obesity epidemic to be a proxy) to appear in one place!
It’s only recently that I have even begun to draw the parallels between inequality and obesity as forms of systemic dysregulation, so thanks so much for giving me even more material.
And yes — “Big Sugar” will fight, and fight dirty, efforts to reign in their era of misrule just as surely as Big Tobacco did before them and Big Oil continue to do.
Keep fighting the good fight …
Yes! So glad the mmt and obesity issue are linked here. I believe diabesity rates will go through the roof in nz soon judging by our children. We must look at Japan and introduce a proper school lunches programme that teaches children to enjoy nourishing food and develops a healthy food culture. How can we pay for it? Are there not enough food resources in NZ? Enough farmers? Enough underemployed to staff the kitchens? Also lets release parents from the tyranny of the lunchbox. Remove an annoying aspect of the double shift for a lot of women perhaps. Processed food producers of course will hate it. I say good.
The link in this article between obesity and economics has encouraged me to believe there was a choice that related these issues. I began in about 2011 to read up in “The Conversation” articles on diet. It didn’t take long to realise we we being lied to, consistently. Ideas based on faulty research which demonised fat became mainstream and the food industry started on the path to creating the obesity epidemic when it took on board the “evidence” that saturated fat was bad and so to cut out fat they substituted sugar. The damage is done now and will not be reversed for decades.
I don’t recall the link but I soon saw that mainstream economics was a web of lies and I shifted my interest to economics, when MMT came into focus. A common denominator, lying and distortion for profit are threaded through our society. Nobody seems to include the Real costs of this distortion. GDP is causal because it avoids externals. So we bear the burden of profit making operations as if they were a necessary good. That is just not so, but little is being done about it. Still today the GDP figures rule the roost and the damage continues unabated.