The City of New York has passed a new law mandating that any restaurant meeting certain criteria post calorie information prominently near menus. The law essentially targets chains and franchises, so the fast food industry is the one most affected. The New York Times reports on a study conducted to test whether or not this law actually had a positive effect:
The study, by several professors at New York University and Yale, tracked customers at four fast-food chains — McDonald’s, Wendy’s, Burger King and Kentucky Fried Chicken — in poor neighborhoods of New York City where there are high rates of obesity.
It found that about half the customers noticed the calorie counts, which were prominently posted on menu boards. About 28 percent of those who noticed them said the information had influenced their ordering, and 9 out of 10 of those said they had made healthier choices as a result.
But when the researchers checked receipts afterward, they found that people had, in fact, ordered slightly more calories than the typical customer had before the labeling law went into effect, in July 2008.
…For customers in New York City, orders had a mean of 846 calories after the labeling law took effect. Before the law took effect, it was 825 calories. In Newark, customers ordered about 825 calories before and after.
The results, according to the New York Times, had little affect on nutrition and public health experts who “said it was not a reason to abandon calorie posting.”
Regardless of its ability to alter behavior, this law is abhorrent. Beyond the nanny-state mentality of trying to influence people’s behavior, we have a major violation of property rights with this law. Each of these restaurants is the private property of an individual or, in the case of a corporation, individuals (the shareholders). No government – federal, state, or local – holds the right to mandate what an individual does with his/her private property. The government of New York City has decided that it is wrong to eat too many calories, they have now enforced their morality on businesses by mandating the posting of these calories. Would we allow the government to mandate the posting of the Ten Commandments in private establishments? Of course not. But most people have a skewed view of what it is for a government to legislate morality – this crime of the state is not limited to religion.
Moving beyond the philosophical, let us look at the practical. These types of laws do not work and are subjective in nature. The chart below illustrates the exact uselessness of these new calorie posting laws.
The fact is that business have every incentive to provide what their customers demand. If customers were actually concerned with calories, business would label their food (as many already do voluntarily). When the government mandates that money be spent by business on a product or service that customers do not want, this is a deadweight loss. But don’t take my word for it. Milton Friedman also weighed in on the subject years ago:
…and the government also prevents useful information from being passed on. Let me give you this simplest example- aspirin, you know and I know that you’re well advised to take an aspirin every other day to reduce the danger of heart attack. But that’s not allowed to be stated on an aspirin package… FDA prohibits it, they control the information that can be stated on a label. Now there are some libertarian manufacturers of drugs who have proposed, who tried to push through the idea that they can put on their thing, this is what the FDA says and this is what we say- choose. And they’re not being allowed to do it. So that if customers really wanted to know about the ingredient, it would be in the self-interest of the people producing it to put it on their packages. Those packages that had the ingredients on it would be more attractive to consumers than those that didn’t. But now, it’s always a mystery to me why people think that some experts in a Washington office who don’t know you, don’t know me, don’t know our children, know better than you and I do what we want to have on our packages and what we want our children to know.
For Dr. Friedman’s entire discussion on the FDA, see our recent post.