The findings show that the beer industry directly and indirectly contributes $246.6 billion annually to the U.S. economy.
Visit Beer Serves America to see the entire study.
INSIGHTS: NYC Soda Ban Goes Flat
By Guest Columnist Mark Rogowsky:
Silicon Valley Entrepreneur and Forbes contributor (Reprinted with permission)
New York’s Mayor Michael Bloomberg has never been one to shy from controversy, especially when it comes to what he sees as efforts to improve public health. But his latest attempt — to ban the sale of sugary soft drinks larger than 16 ounces — has officially fizzled. (And, oh yes, pun fully intended.) A state judge with the absolutely delightful name for the case of Milton Tingling — I can’t make this stuff up — has informed the city that it’s “enjoing and permanently restrained from implementing or enforcing the new regulations.”
Tingling didn’t like the rule because it was wildly inconsistent. A 7-11 or a corner bodega could sell a large soda, but a neighborhood McDonald’s couldn’t. The regulations are “fraught with arbitrary and capricious consequences,” the judge wrote, as reported in The Wall Street Journal. “The simple reading of the rule leads to the earlier acknowledged uneven enforcement even within a particular city block, much less the city as a whole… the loopholes in this rule effectively defeat the state purpose of the rule.”
And good riddance, really. This was a bad idea even without the bad implementation and the “whys” should serve as a lesson to future would-be Bloombergs. There’s a big difference in regulation types and Bloomberg seems to have lost sight of that fact on the way to the Nanny State. Specifically:
Your rights aren’t unlimited with respect to others. In 2003, early on in Bloomberg’s reign, he pushed through a smoking ban that included bars and restaurants on the grounds that second-hand smoke was affecting other people beside the smokers. (Soon after the city ban went into effect, the state followed with a ban of its own.) Despite all sort of predictions that bars would go out of business, drinking is alive and well in New York — even if you want a large Coke, thanks to Judge Tingling. In the meantime, servers and patrons that don’t smoke have a more pleasant experience and smokers have figured out that there’s camaraderie in standing outside to light up, a trick office workers had learned years earlier.
Information is powerful in changing behavior. Bloomberg, of course, wasn’t done at smoking and after some legal challenges, got a 2008 rule in place that required restaurants to post calorie counts on menus. The rule seemed to work, causing diners who bothered to use the information to eat about 100 fewer calories per fast-food meal. Here, the key was getting everyone to play by the rules, which were strongly resisted by fast-food establishments. But it’s up to diners to make their own choices. At the time, the New York City rule was a big deal, but in more and more of the country, calorie counts are posted on menus and there is no doubt that they at least cause people to do a double-take on some of the worst choices out there.
… But coercion is another matter. The soda ban was in an entirely new category, basically, “We’re preventing you from doing this because we have decided it’s bad for you even though there is no immediate harm brought on others.” Unlike a cigarette tax which discourages behavior by making it more costly or an information campaign designed to inform, the soda ban was basically a way of making it inconvenient to drink a lot of calories with a Big Mac. It couldn’t stop someone from buying two small sodas, of course, but it could make life inconvenient for servers at a restaurant that offered unlimited refills by limiting the cup size to 16 ounces. People aren’t huge fans of being told what to do; but they absolutely hate being forced to do something.
The irony is that on the New York subways there’s a pretty effective ad campaign that shows how many calories are in beverages and — as with the menu requirements — some people are doubtless making better choices because of it. Voluntarily. Perhaps the soda ban could have yielded some reductions in consumption, but there wouldn’t have been many people happy about how it got there. And the complete lack of clarity in the rules (you couldn’t order a 2-liter soda with your pizza delivery, but of course you could bring one home with your frozen pizza) meant the ban was destined to be mocked for years to come.
That Tingling sensation New York City is feeling today is the outgoing mayor’s latest overreach of his power getting capped. None of this means that drinking a 6-pack of Pepsi is going to get you 6-pack abs or that it’s anything more than 900 calories of dietary nightmare. But it does give everyone trying to come up with real solutions to the obesity problems in the U.S. a chance to stop and reconsider their tactics. Prohibition never works and the Nanny State ought to know better.
ON THE ECONOMY: GAY MARRIAGE
By John Dunham:
Managing Partner, John Dunham & Associates
This week, the Supreme Court takes up the issue of gay marriage in its examination of two laws. The first is a case challenging Proposition 8, which is California’s ban on gay marriage. The second is a case challenging the Federal Defense of Marriage Act (DOMA). Interestingly, as an economist, I have not come across much research on the economics of the gay marriage issue. I find this surprising. There is an economic story behind every issue, and this case is no exception. Focusing on the economics of the issue would have been a useful lobbying tool at the state level, but neither side in this debate has waged a fact-based campaign. Rather, they have relied on religious and emotional messages that I do not believe serve either constituency well.
Ever since a handful of state passed legislation legalizing gay marriage, there have been articles written discussing how the growth in marriage ceremonies has helped local economies. New York City alone has suggested that gay marriages have added $259 million to its economy. While this pales in comparison to the region’s nearly $1.3 trillion economy, it should not be sneered at during tough economic times.
But the impact of parties and ceremonies is transient as is all spending type impacts. Much of the activity is simply a transfer from one economic sector (say dining out) to another (flowers), or a transfer from one region to another. This type of activity, a one-shot, does not generate future economic growth. What has not been examined in detail is the true economic consequence or benefit of allowing for same-sex marriages-and that is a shame because important policy decisions should not be made without facts.
A cursory search finds only one paper written on this topic, and it is not particularly thoughtful. Written in 2005 by Douglas Allen, an economics professor at Simon Frasier University, this paper argues that gay marriage is actually economically inefficient. In his paper, Allen cites Douglas Coase in suggesting that laws are developed not to eliminate harm, but rather to decide whom should be allowed to hurt whom? He suggests that the regulation of marriage has evolved over time so that the benefits exceed the costs. Any change, therefore, to marriage laws has to examine how costs and benefits are changed. In the end, he argues that gay marriage benefits homosexual couples while harming heterosexual couples. But this conclusion implies that marriage laws are currently optimal, and change will impact negatively on the mass of heterosexual couples already allowed to marry. While this may or may not be true, Allen fails to make a reasonable case in his paper.
Differing lifestyles, divorce rates, or proclivities aside, there is little evidence in the literature that gay marriage weakens the institution. All the same, there is little research on whether or not there is an economic benefit to gay couples that cannot be handled in another fashion. Logic would suggest that if marriage in beneficial in heterosexual relationships that do not involve children, than it is likely to be just as beneficial in homosexual relationships, but without real research on the topic this is only conjecture.
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