A spoonful of sense
To understand the information on a food label you not only have to be able to read between the lines but be part nutritionist and part investigator.
Since all a consumer wants is a little knowledge to help him eat healthier, the simpler and more direct the message the better.
Which is why it was so significant last week when the Food and Drug Administration proposed the first changes to nutrition labels since the federal agency began requiring them more than 20 years ago.
Not only would the new labels put more emphasis on caloric intake and “added” sugar, but they would also make it considerably easier to determine the numbers for a single serving.
Now, you glance at the label for a small bag of chips and don’t notice the information is for two servings. Or, you buy a 20-ounce soft drink and the nutritional information is for 8 ounces.
How many people stop drinking after 8 ounces?
Under the new rules, the nutritional information would be for 20 ounces.
The U.S. is like no other country in the world when it comes to eating, evidenced by the fact more than a third of all Americans are obese, according to the Centers for Disease Control and Prevention.
Certainly a major part of that weight gain is from sugar, with studies showing we eat more sugar than we realize. Yet added sugar is not as easy to spot on labels despite being the same chemically as natural sugar.
Added sugar might be listed under an ingredient such as corn sweetener, corn syrup, dextrose, fructose, lactose, fruit juice concentrate or molasses.
The American Heart Association recommends limiting “added sugar” to no more than half one’s daily discretionary calories — about 150 calories a day (9 teaspoons) for men and 100 calories a day (6 teaspoons) for women.
One thing some studies show is that people eat healthier when they read — and understand — nutrition labels.
The proposed new labels will greatly increase the size of type for certain things, most importantly, calories. If the average person does not understand what “x” number of grams of a vitamin means, one thing everyone does know is calories.
Think of how much the eating habits of Americans have changed in 20 years. We no longer eat the way we used to. We no longer eat the things we used to.
Anything we can do to simply understand what we are eating is a good thing.
Putting clear information on the approximately 700,000 food and drink products that contain nutrition labels is a start.
They may help curtail the obesity epidemic in this country, or at the very least, help more people understand why they are obese.
— The State Journal
Darts and Laurels
A laurel to our nation’s soldiers, most especially those who give all.
A dart to Winter Storm Titan — pretty savage.
A laurel to Michael Schmitt and Paul Williams — Johnson County’s newest ‘Distinguished Citizens.’
A dart to those who continue to manufacture methamphetamine — dangerous, lethal, and just stupid.
A laurel to UPike’s new optometry school — more opportunites for the region’s students!
Hospital pricing a secret system
As we become ever more conscious of health care costs, here’s a question that begs an answer:
How can the same simple procedure at one Louisville hospital cost more than three times that amount at another?
That was the question raised in a story in Monday’s Courier-Journal by Laura Ungar in which a mother wonders why her young son’s ear tubes cost $1,560 at Kosair Children’s Hospital and a year later, $5,260 at Jewish Hospital Medical Center East.
“It just doesn’t seem fair,” said Crystal McGrew, of Taylorsville, whose son, Amos, needed the tubes for relief from ear infections. “It doesn’t seem logical.”
The short answer is that there is no answer. Hospital pricing is neither fair nor logical under a complex and murky system that allows individual hospitals to set their own rates, resulting in wildly varying charges within the same community for the same procedures.
“How do hospitals set prices?” Glenn Melnick, a California health economics professor, asked in a recent New York Times story. “They set prices to maximize revenue and they raise prices as much as they can — all the research supports that.”
It’s an issue attracting increased national scrutiny as consumers with rising deductibles become more conscious of health care costs and what they must pay.
And it most definitely undercuts critics of the Affordable Care Act who argue for a free market approach to health care with competition as the best way to bring prices down. That health care “free market” got us to where we are today.
Few things are more competitive than the health care industry yet prices around the country are soaring at some hospitals in a business largely organized through nonprofit entities with enormous tax benefits. That leaves baffled consumers looking at huge bills for even minor procedures, such as the California woman charged $2,229 for three stitches to a cut on her knee, according to the New York Times.
Health policy experts say one solution is for consumers to shop more wisely as health care becomes an increasingly retail commodity.
Yet it’s hard to shop when hospitals can’t explain their prices or decline to release them. It is a secret system that must become more transparent.
Some states have begun to address the mystery of hospital charges, including California, which requires the disclosure of typically secret price lists. New York last year released similar data over objections of hospital trade groups who argued access to such information would confuse consumers.
Critics of “Obamacare” have constantly demanded the law be repealed but offer no alternative. Instead, they should demand changes that help make health care a truly free marketplace.
— The Courier-Journal
Darts and Laurels
A laurel to ‘Operation Broken Heart’ and the continued crackdown on drug activity!
A dart to cruel treatment of animals — unjustified!
A laurel to renovation of the city Little League field — good for kids, good for business!
A dart to doing wrong with open eyes and expecting others to close theirs.
A laurel to Kentucky Chautauqua events and keeping history alive!
Local options sales tax in Kentucky
This year, the Kentucky state legislature could give citizens a chance to a vote on allowing time-limited local sales taxes for dedicated projects. These would be optional at the local level, probably a one-percentage-point rate added to the six percent rate now levied by Kentucky state government. As economists, we write not to recommend higher taxes overall, but to explain why local sales taxes are both popular around the United States and a useful addition to the financial toolbox of local communities.
Economists see many advantages to local sales taxes compared to other taxes. One axiom of economics is that if you tax something you get less of it. Thus, taxing consumption encourages saving, while taxing income punishes effort and achievement. Moreover, households tend to view sales taxes as associated with the voluntary act of purchasing something desirable, but view income taxes as a forced extraction from their hard earned wages and salaries. Hence, voters are more likely to approve sales tax increases, particularly when they see the funds dedicated to an important public good or service, but to reject income tax increases.
Local governments around Kentucky need some financial flexibility. They are on the front lines of services to residents and businesses, including public safety, fire protection, EMS, sanitation, roads, sidewalks, libraries, parks and recreation facilities. Yet, they are increasingly squeezed by huge employee pension costs required by state government. Local governments rely on property tax revenues, which have been flat for many years, and occupational and business taxes that discourage work and risk taking. And, being closest to voters, local public officials hear the “no new taxes” message the loudest and most frequent.
A more subtle, but equally important, point is that communities around Kentucky aspire to grow and prosper in different ways. Some want more safety, some more parks, some more libraries, convention centers, bike paths, arts facilities, buses, or swimming pools. Some want less. Kentucky state government has traditionally provided many of these economic- development and quality-of-life amenities for communities. But state government has its own fiscal constraints and should spend its growth dollars on truly statewide issues, like highways, bridges, higher education, health care for the poor, and prisons.
With the option of adding, say, a penny to the sales tax, local governments could place on the ballot a proposal to spend the extra money on a specific package of public services most in demand by local citizens. If they approve it in a referendum, clearly the community wants to tax itself to get items in the package. If the referendum fails, the tax would not go into effect. The complicated state-local funding structures to build the Louisville downtown arena and the rebuilding of Rupp Arena in Lexington are great examples of projects that could more cleanly be funded by a local sales tax.
Under one format, the additional sales tax revenues are used to service the debt on a bond issue, typically with a 20-year life, with the bond proceeds dedicated to some community enhancement projects rather than core local public services like police. When the bonds are paid off, the local sales tax expires unless voters re-authorize it for new projects.
The local sales tax option also creates the possibility of changing the structure of taxation without raising overall taxation. For example, a community could vote to reduce or get rid of its occupational license tax or net profits tax and replace the revenues with those from a sales tax.
Thirty-seven US states allow local sales taxes. Eighty of the largest 108 American cities have local sales taxes. Of our bordering states, only Indiana and Virginia do not allow them. Tennessee uses local sales taxes extensively, with rates up to 2.25 percent (on top of the state rate of 7 percent), and is thus able to function without taxation of wages and salaries anywhere. Kentucky’s constitution currently allows general sales taxation only at the state level. But an amendment to the constitution, allowing local sales taxes, has been offered to the legislature, and with approval from the General Assembly will be submitted to voters later this year. We believe adding this tool to the toolbox of communities in Kentucky makes good economic sense.
Submitted by Paul Coomes, Ph.D., Emeritus Professor of Economics, University of Louisville, email@example.com and William Hoyt, Ph.D., Gatton-Endowed Professor and Chair of Economics, University of Kentucky, firstname.lastname@example.org.