Nudge the U.S. Out of Its Obesity

Last Wednesday, New York City Mayor Michael Bloomberg unveiled his administration's latest salvo in its war against obesity. This time, it's a soda regulation to prohibit movie theaters, food trucks and fast food chains from serving sugary drinks in cups that hold more than 16 ounces. To its critics, the policy is one more instance of the nanny state restricting consumers' choices. But when citizens become a victim of their choices because they are surrounded by hazardous options, the case for an unrestricted market weakens. Until more policymakers implement boundary-pushing policy experiments such as Mr. Bloomberg's, the U.S. will continue its gradual plod to the social and fiscal epidemic known as obesity.

According to the U.S. Center for Disease Control (CDC), obesity rates have stampeded upward over the past two decades. Depressingly, the CDC estimates that more than one-third of U.S. adults and 17% of children are currently obese. As obesity has risen, government efforts to turn the tide have been few, limited and largely unsuccessful. Meanwhile, a growing amount of research continues to link obesity to shorter life expectancies, greater employee absenteeism, dramatically higher healthcare costs and various forms of discrimination.

Parallels to the anti-obesity movement can be drawn from the anti-smoking movement. Much like smoking, individual cases of obesity are often written off as failures of personal responsibility or as untouchable products of free will. If only we educate and persuade consumers, so the anti-smoking campaign logic went, then they'll make the right choices. But public service announcements like those run by Partnership for a Drug-Free America couldn't cut smoking rates on their own. It took enforcement actions that restricted minors' access to cigarettes, prevented advertising to children, limited where cigarettes could be smoked, and taxed cigarette purchases to make the intake of carcinogens more expensive. In the end, it took public policy, not just public service announcements, to reduce U.S. smoking rates.

Unlike anti-smoking advocacy, anti-obesity policymaking is a much less mature field, and the public is still unsure when -- or if -- it wants the government meddling in what it eats and drinks. Despite the significant responsibility for obesity possessed by the food industry for how food is produced, marketed and distributed, blame for obesity is still directed heavily at obese individuals. Dietary or exercise failings aside, heaping social disapproval upon the obese is morally unacceptable and dangerously exacerbates the U.S.'s existing fetish for unhealthy body imagery.

Accordingly, one of the greatest lingering barriers to solving obesity is the tremendously personal nature of regulating what foods and beverages individuals can put into their bodies. Should government really tell us what kind of soda we can buy? However, under Mr. Bloomberg's policy, consumers determined to ingest more than 16 ounces of a sugary beverage can still do so under free refill policies or through the purchase of multiple servings. Moreover, grocery stores and convenience stores will still be free to sell sweetened beverages in existing sizes.

Rather, Mr. Bloomberg's policy is an example of what University of Chicago professors Cass Sunstein and Richard Thaler have coined "nudging" -- designing public policies to create a choice architecture that encourages rather than forces the public to make better decisions. Under their view, an unrestricted market does not always lead individuals to make rational choices due to their inherent psychological biases and irrational tendencies. Policymakers who solve such mental riddles can provide a valuable weapon for public good -- the ability to help consumers improve their lives simply by becoming better personal decision-makers.

In the same vein, the proposed New York policy does not stop individuals from drinking 32 ounces of a sugary beverage. Instead, it forces them to buy it in two installments. It's a nuanced change, but it significantly alters how consumers are presented with their choice set. Instead of the retailer nudging customers into purchasing more calories by steeply discounting plus-sized beverages, New York will be doing the opposite: nudging consumers to drink less of high calorie beverages by asking, in effect, "Do you really need those extra 16 ounces of Coca-Cola?" and "What about drinking Diet Coke or a Vitamin Water instead?" Any marketing professional knows that customers are much more likely to do pretty much anything if the default choice is "yes" instead of "no." In much the same manner, Mr. Bloomberg is attempting to require the consumer to make a conscious opt-in decision to spring for a second serving, get a free refill, or downgrade to a smaller-sized drink.

A valid criticism of Mr. Bloomberg's proposal is that it may ultimately prove to be ineffective. Undoubtedly, the policy can and will be subverted in numerous ways. For example, consumers may shift more of their soft drink buying to neighborhood convenience stores or take greater advantage of free refills. But whether or not the policy will be successful is an empirical question, and that answer will be borne out only with time and careful research.

Ultimately, the mass consumption of high-calorie beverages continues to grow our waistlines, shorten our lives, and siphon off a growing portion of our GDP to healthcare costs. Admittedly, despite New York City Health Commissioner Thomas Farley's estimate that as much as half of the increase in the city's obesity rates over the past three decades has been due to sweetened drinks, there are surely myriad factors responsible. However, rather than throw up their hands, other city and state policymakers should borrow Mr. Bloomberg's approach and nudge more of their own citizens into making better choices. Well thought-out policies that don't succeed will do little harm, while those that do find success can be widely adopted. As it stands, when it comes to obesity, most policymakers are setting a bad example: remaining in their chairs.