If there's one thing I'm surprised about, it's the giant presence of soft drink makers in society - especially Coca-Cola. Coca-Cola is a multi-billion dollar company that is seemingly everywhere. They have their signs at football games, commercials on tv, and now they even fund scholarships. I pass a Coca-Cola distribution plant on the way to work, so they are even providing employment in the local area.
My question is: why has all this wealth and power gone to a corporation whose main product is unhealthy? Coca-Cola is just sugar water mixed with caffeine. No matter what the "secret formula" is, it's a high-glycemic drink that can lead to a variety of health problems, such as tooth decay, diabetes, the metabolic syndrome in general, etc.
I feel this is one of the myths of capitalism, that profits flow to companies that produce better products. The only thing Coca-Cola is "better" at, is making its product more addictive than its rivals. Either that, or they have better advertising to increase demand for their product.
Here's my thinking on the subject: Coca-Cola and the whole soft drink industry is not important. If soft drinks didn't exist, the world would be a better place. People and especially children might be healthier (if they chose to drink water instead of a different unhealthy drink).
Though the soft drink industry employs many people, that doesn't justify that the industry is important. This would be like saying the police shouldn't crack down on drug dealers, because it may put them out of a job.
There are so many industries today that are based on human weakness, such as payday lenders, junk food makers, etc. I wish our economic system better rewarded those who actually want to benefit customers instead of those that want to prey on them.
The market does benefit people, it just doesn’t benefit them the way you think it should.
People prefer junk food to health food, so the market produces plenty of junk food. So, the market produces what people want – sounds like a benefit to me.
“I feel this is one of the myths of capitalism, that profits flow to companies that produce better products.”
Hmm, sounds like a strawman myth espoused by opponents of capitalism, or those ignorant of it.
Capitalism is simply what happens to capital when society and culture is organized around principles of freedom and private property. Capital flows to those who best utilize it to generate profits — period. Unfortunately, in societies organized around hierarchical and centralized oversight, regulation, and control, capital flows to those best able to game, manipulate, or otherwise influence or buy-off the system — a pretty good description of America and the rest of the developed world where large corporations exist.
To some extent, true capitalism does exist in America, but probably only in relatively unregulated industries (B2B, primarily) and amongst relatively small companies without the horsepower to get legislation passed to make things easier on themselves, tough on competition, and to set up barriers to new entries.
In a very limited sense, yes. But this assumes that there is no impact on any third parties from this decision.
I have a post on this coming up.
Matt,
I’m with you on this one. I am in favour of capitalism but recent events have shown us that without regulation it does not work. We cannot rely on market forces and the presumption of consumer intelligence to drive products. Sure, eventually consumers would wake up and stop buying coke, but in the meantime how much money would governments have spent treating them for illnesses? This is money which could have been spent on making the world a better place, instead squandered on treating illness that could have been avoided. Not only that, but the collective talent of those emplyed at coke to develop, produce and market this crap would have been directed at something less destructive.
Some more thoughts on this here: http://paynowlivelater.blogspot.com/2008/09/hfcs-little-man-and-big-business-part-2.html
Methuselah:
I don’t accept your premise, which is to say, I see nothing in evolution that suggests I have any moral obligation to pay for other people’s problems (externalities).
I understand that this is how society operates — that here in the US, for instance, I have money taken from me by force (threat of fine, imprisonment, or both for non-compliance), and this money goes not to support my values, but the values of others.
I also understand that by not willingly or otherwise paying for such things, one possible outcome is that things get worse, ushering in externalities and consequences for me even beyond those imposed by governmental threat of force against me.
So be it. I’m perfectly happy to take my chances. I would far rather that my money (the fruits of the time and production of my life) go to pay for my values and those of loved ones, friends, associated, colleagues, etc. and I’ll live with the stocasticity of the rest.
We evolved to account for the values and actions of 25-30 people, a context in which we had real and important influence in a group. I firmly believe that this is why hierarchical collectivism a-la the entire modern world, now, doesn’t really work, and will never work. Well, maybe a few hundred years hence, when all individuality has evolved out of us and we become the human equivalent of bees and ants.
Trying to make it work is tantamount to keeping a mile long slosh tube in balance.
Many in the EvFit / Paleo world of diet and fitness understand fully how arrogant modern man has become, unwilling to acknowledge that biological systems are as yet far too complex to mess with in providing all the frankenfood and drug therapy that pervades.
What I’m saying is that the same goes for our modern social, economic, and governmental system.
Never forget: the chief cause of death for humans is natural causes. The second chief cause of death throughout agricultural history is government. The toll is in the hundreds of millions.
Hi Richard – don’t get me wrong: I don’t believe we have a moral obligation to pay for other people’s problems either. As a fellow EvFitter, part of me very much is in tune with the philosophy you outline. But there is another part of me which is a pragmatist, and looks at the world with a ‘we are where we are’ attitude. It’s that side of me that would like to see more regulation etc because ultimately it affects how much money my government has available to spend on me, my loved ones and (as it happens) the rest of the country (in my case the UK.)
Matt,
I think one of the basic problems in this case is the farm bill. It makes sugar artificially cheap, both corn and cane based. I think subsidies should go toward healthier foods. That may sound paternalistic, but it’s no more paternalistic than the current system. If we want full-scale domestic agriculture, we have to subsidize. What crops/farmers will we give the money to?
Yes, there are a variety of harmful subsidies. However, I think if you leave it to the market, even if you subsidize healthy food, you will still end up with junk food being cheaper. There is just too much demand, and hence profit to be made.
all i can say, i haven’t drank anything by coca-cola for nearly five years, and i don’t feel like i missed anything. water is cheaper, fruit juice is healthier, and coffee, well, it’s just a better vice!