Economics & Finance

Lean Times Are a Thing of the Past

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The incomparable Megan McArdle (who blogs under the name Jane Galt) posted an essay where she discusses a book she read. The book posited a theory about why it is difficult for some people to lose weight, the problem being that they were genetically predisposed to packing it on, and their bodies sent danger signals if the feed bag was removed.

That was interesting enough, but I found the comments left by her readers to be more revealing. It seems that just about everyone seemed to think that America has the fattest people on Earth.

This is simply no longer true, and anyone who is interested has known about this for years. It seems that at least 7 European countries boast populations that have higher percentages of obesity than levels found in the United States, according to a news report from 2005. It has gotten so bad in recent years that even the glacially slow European Union bureaucracy has decided to lurch into action.

One might think that the rest of the European Union, at least, has a population that is slimmer than that found in the United States. Not necessarily. As this essay by Michael Fumento states, some of the data that was gleaned back in 2005 came from surveys where people were asked to gauge their own weight. Since no one who is overweight likes to admit it, it would be prudent to take any claims of how Europeans are oh-so-svelte with a grain of salt.

Europe has a fat problem, so why the widespread criticism of the American lifestyle and high obesity levels? A report commissioned by the food corporation Kraft might shed some light on this annoying example of cognitive dissonance.

“…Europeans view obesity as a problem that affects others, but not themselves.”

There are a few things about the situation that I find very interesting.

First off, the public perception seems to be that Europe doesn’t have an obesity problem and only the indolent and crass Americans must struggle with their weight. Why this is so puzzles me in light of easily perceived evidence to the contrary, but I have noticed that Europeans tend to try and make themselves feel good by indulging in anti-America bigotry. This appears to be a triumph of European feel-good propaganda.

While high levels of obesity have been recognized as a health problem in America for at least twenty years, it seems to be a recent revelation in Europe. Perhaps coincidentally, Europe also lags behind the US in economic development. In fact, it appears that Europe is 22 years behind the US since they just reached the level of prosperity we enjoyed way back in 1985.

Hmmm. 1985. When did the obesity problem in the US first kick in to high gear, anyway?

One of the fattest countries in Europe is Germany, which enjoys an improving economy. Cyprus also has an obesity problem, and according to the CIA Factbook they enjoy a much higher level of growth than the standard EU rate.

Is there a correlation between GDP and obesity rates? Maybe. I have never studied economics so I am not qualified to say. But it certainly seems possible to this layman.

Quote of the Day

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Reductio ad absurdum done right.

The Upside of Income Inequality

By Gary S. Becker and Kevin M. Murphy
From the May/June 2007 Issue of American.com

For many, the solution to an increase in inequality is to make the tax structure more progressiveā€”raise taxes on high-income households and reduce taxes on low-income households. While this may sound sensible, it is not. Would these same indi Ā­viduals advocate a tax on going to college and a subsidy for dropping out of high school in response to the increased importance of education? We think not. Yet shifting the tax structure has exactly this effect.

On Transatlantic Myths

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Link via Atlantic Review:

William Drozdiak writes in his article ‘4 Myths About America-Bashing in Europe’ among other things:

With the collapse of the Soviet Union and the end of the Cold War, Europe supposedly lost its relevance. Not true. In fact, Europe and the United States still act as the twin turbines of the global economy, accounting for 60 percent of all trade and investment flows.

Americans invested five times as much money in Germany last year as they did in China, and U.S. firms in total have poured four times as much money into tiny Belgium as they have into India. Europe provides three-quarters of all foreign investment in the United States, creating millions of American jobs.

It Isn’t Voodoo Economics

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An economist named John Schmitt is quoted extensively in this Reuters news article. It seems that he is rather upset with the way we do things here in the United States. You see, we are ā€œthe only advanced economy in the world that does not guarantee its workers paid vacation days and paid holidays.ā€ Mr. Schmitt says that it is a ā€œnational embarrassment.ā€Ā

The article then goes on to point out that French workers are guaranteed 30 days of paid leave per annum, but only one paid holiday. Most of the other European countries force employers to provide a mere 20 days of paid leave, but the workers also are allowed 15 paid holidays.

That sounds nice on the surface, but I seem to recall that Europe is seriously lagging behind the United States so far as GDP is concerned. In fact, didn’t Europe just manage to reach the level of prosperity that the US attained a full generation ago?

It seems to me that there might just be a connection between government mandated vacation time and slow economic growth, a connection that Mr. Schmitt seems to have missed when talking about our “national embarrassment.”

But economists probably suffer more from embarrassment than I do. If I was Mr. Schmitt, for example, my face would certainly be red after that Reuters article came out.