Thursday, 27 August 2015

Aseem Malhotra still doesn't know what he's talking about

Aseem Malhotra has inexplicably been on television again today spouting his latest scientifically illiterate theories. In recent months he has been lurching ever closer towards the low carb cult and the Atkins diet. He is now telling people to eat a low carb, high fat diet while simultaneously telling them to adopt the Mediterranean diet. The latter has never been properly defined but is certainly not low carb. I can only assume that he has now read more than one diet book.

In the last year or so, Malhotra has done his best to deter people from taking statins, downplay the importance of physical activity, eat more fat and not worry about how many calories they consume - strange behaviour for a cardiologist. Perhaps, as Fergus says, he is trying to recruit new customers.

The only upside about the cretin of Croydon appearing in the media is that it stirs scientists into rebutting his drivel, so rather than fisk his eat-more-fat-and-consume-more-calories article, here are a few comments from the Science Media Centre...

... it is disappointing that this incomplete review reduces the diet to mere prescriptive nutrition: eat flaxseeds (good), eat almonds (good), eat olive oil (good), don’t eat sugar (bad) – dogma that’s exactly the opposite to the Mediterranean-style eating approach. The impression to ‘never mind the calories, feel their nutritional quality’ is in my opinion a misleading and superficial approach to a healthy eating.

I can agree with only one point made in this rather confusing editorial which seems to jump from one poorly proven hypothesis to another, undoing the work of thousands of good quality research papers and backed by years of careful research.

In my opinion, it is idiotic to suggest that calories don’t count and then advocate a high fat diet. The editorial has muddled obesity prevention with cardiovascular disease prevention.  Obesity is only prevented if energy intake is balanced by energy expenditure.

Adding fat to food is the easiest way to increase calories in food so pouring large amounts of olive oil over food or eating loads of nuts is not going to help prevent obesity!  

As I have said from the very beginning, Aseem Malhotra doesn't know what he's talking about.

Revisiting CAMRA's 'historic victory'

Last year I wrote a post about what the Campaign for Real Ale described as its 'historic victory' of breaking the beer tie.

This is actually the second time that CAMRA has successfully lobbied to break the beer tie. They first did it in the 1980s when Thatcher forced breweries to sell off thousands of pubs. The unintended, but predictable, consequence was that thousands of pubs were bought up by property management companies.

These companies (pubcos) soon became the new villains in CAMRA mythology and last year they were cut down to size when the government (or, more precisely, the opposition plus the Lib Dems) broke the modern beer tie by banning pubcos from making it a contractual obligation for tenants to buy alcohol from them at a higher-than-market rate. This is known as the Market Rent Only option and tenants of large pubcos now have a legal right to it.

Pubcos that cannot make enough money without the beer tie will increase the rent, but the government has decided to regulate pub rents as well. Therefore, the likely outcome of the 'Save Our Pubs' campaign is that pubcos will sell off a large part of their estate.

CAMRA more or less openly wants them to sell their pubs because it believes that thousands of ruddy-faced publicans are ready to run them as independent concerns. This is a fantasy. There is not enough capital in the independent sector and you would have to be brave or foolhardy to buy a pub in Britain after successive governments have systematically shafted the industry. It is more likely that they will be sold off as shops and dwellings.

In other words, CAMRA's campaign will achieve the exact opposite of its stated aim of saving pubs.

I said all this last year and it did not go down well with CAMRA and their fellow travellers, who accused me of being in the pocket of the pubcos (and other such baseless non-arguments), but time is beginning to tell...

Punch Taverns has confirmed it has agreed to sell a package of 158 non-core pubs to NewRiver Retail, the UK REIT that specialises in the food and value sector, for £53.5m.

Why is Punch Taverns selling off these boozers? One tenant, Carol Ross, spoke to the Morning Advertiser yesterday...

The Roscoe Head in Liverpool has been in Carol Ross’ family for 30 years, 20 of which has seen her in charge winning a number of awards. Speaking to the PMA after receiving the news by post that her pub would be sold to New River Retail, she said she was “gobsmacked and upset” and now fears her pub was at risk of being redeveloped into a retail outlet.

Ross said she had been trying to buy the pub’s freehold, and had informed Punch she wished to opt for Market Rent Only (MRO) next year.

From next year I have to be offered Market Rent Only, and I told them I would be taking it, that’s why they’re selling my pub - because I won’t be making them as much money. NewRiver Retail will own less [sic] pubs [under 500], so they won’t have to offer it,” she speculated.

According to the article, Ross's pub is a successful business so perhaps NewRiver Retail will keep it as a going concern, but their track record isn't great...

NewRiver Retail acquired 202 pubs from Marston’s for £90m in 2013, with the group announcing last month that good progress had been made in converting a number to convenience stores.

Oh dear. Who could possibly have seen this coming?

Now CAMRA has been reduced to 'urging' pubcos to 'consider other options for sale, including offering pubs to community groups or licensees themselves, before selling to property companies'. I doubt pubcos are in any mood to take business advice from an economically illiterate pressure group that openly hates them. They will do whatever makes financial sense in a market that has been horrendously distorted by CAMRA and other useful idiots.

Be careful what you wish for.

Wednesday, 26 August 2015

New data confirm that tobacco sales rose after plain packaging

As reported last week by Guido and Catallaxy Files (but no mainstream media outlets that I know of), tobacco sales increased by 0.5 per cent in the first year of plain packaging in Australia. I didn't want to comment until I'd had a change to look at the newly published stats in depth, but I have now done so and the figures in Guido's report are spot on.

21,901,393,720 cigarettes were sold in the twelve months before plain packaging was introduced. In the next twelve months, 22,016,130,420 cigarettes were sold. This is a rise - a small rise but a remarkable one considering that sales had been consistently falling for many years before the policy was introduced.

As Sinclair Davidson has explained, advocates of plain packaging have done two things wrong in order to claim that there was a 3.4 per cent decline in tobacco sales in the first year of plain packaging. Firstly, they compared the calendar years 2012 and 2013 despite plain packaging starting at the beginning of December 2012. Obviously, they should be comparing December 2011-November 2012 to December 2012-2013. If they did that they would see that the difference is just 0.8 per cent.

In the context of a long-term decline in sales of around 5 per cent per annum, a fall of 0.8 per cent is a truly pathetic outcome from a policy that Simon Chapman, a pea-brained blowhard, has compared to a vaccine for lung cancer. But it gets worse for the wowsers...

The second thing the campaigners willfully ignored was the tax refunded on tobacco products which were never sold to the public. This is a significant number of cigarettes when you consider that lots of branded tobacco products had to be taken off the market when plain packaging was introduced and were later destroyed. According to newly released data from the Australian government, it amounted to 284 million sticks. When these cigarettes are subtracted from the pre-plain packaging period, it becomes apparent that sales-to-consumers rose by 0.5 per cent in the first twelve months of plain packaging.

The only missing variable here is the number of refunded cigarettes in the post-plain packaging period. This is unlikely to be zero, but is almost certain to be a lot smaller than that refunded as a result of plain packaging since plain packaging led to an exceptional, one-off destruction of tobacco products (literally). The figures for refunded tobacco in 2013 would make the comparison even more accurate but they would almost certainly change the final estimate by no more than a fraction of one per cent. Whichever way you slice it, the claim that was an immediate effect on sales from plain packaging is bunkum. And that's without even mentioning that growing black market.

You can see the data here, but as it requires a little effort to calculate the total number of cigarettes sold I have included the figures at the bottom of this post. (If you are on a Mac you may need to change the document's suffix to .pdf to read.)

We already knew from other sources that the long-term decline in tobacco sales came to an end in the first year of plain packaging and only resumed after a heavy tax hike in December 2013. This new and more accurate data confirms it. This deserves to be bigger news. The UK, Ireland and France have committed to plain packaging based on a lie. ASH used the bogus 3.4 per cent figure in their lobbying and, as Davidson points out, the French even claimed that there was a 3.4 per cent decline in smoking prevalence.

Australia is in the process of conducting a post-implementation review into plain packaging. If this evidence is not front and centre, we will know that the process is a sham. Predictably enough, it seems that the post-implementation review has already shifted the goalposts. The policy was explicitly designed to reduce cigarette sales and smoking prevalence. Since it is now clear that it has had no measurable effect on either, the review will instead look at whether it has reduced the appeal of cigarette packs. That means looking at the same tenuous evidence that was cited by campaigners in 2011 - evidence that tells us nothing about the real world effects.
The reality is that plain packaging did not accelerate the long term decline in smoking rates or tobacco sales, but it did create a number of negative consequences for businesses, consumers and the government itself. Any serious cost-benefit analysis would find multiple costs and zero benefits.

As for the campaigners who have been so quiet about the new evidence, don't forget that they vilified Christian Kerr of The Australian last summer when he dared to say that tobacco sales had risen in the first year of the Australian plain packaging experiment. The portly propagandist Stephen Koukoulas was particularly vociferous, describing Kerr et al. as 'smoking fact deniers' and 'tobacco fact deniers'. The hopelessly biased ABC gave Koukoulas and other plain packaging advocates airtime to rubbish Kerr's report.

We now know that Kerr was right. An apology is in order but will never arrive. Instead, there is only silence and tumbleweed from those who claimed that plain packaging was a game-changer.

The data

The government's sales figures are divided between domestically produced tobacco products (ATO) and imported tobacco products (customs). They are also divided between manufactured cigarettes (sticks) and rolling tobacco (loose leaf).

To derive the total number of cigarettes sold, you need to combine the ATO and customs figures for both type of products and then subtract the refunds. For loose leaf tobacco, the government calculates that one cigarette contains 0.8 grams of tobacco, ie. 1 kilogram contains 1,250 cigarettes.

In the twelve months before plain packaging was introduced (Dec 2011-Nov 2012), the figures were as follows:

Manufactured cigarettes: 19,738,170,960

Cigarettes from rolling tobacco: 2,447,248,750

Never sold to the public: -284,025,990

Total: 21,901,393,720 

In the twelve months after plain packaging was introduced (Dec 2012-Nov 2013), the figures were as follows:

Manufactured cigarettes: 19,433,987,920

Cigarettes from rolling tobacco: 2,582,142,500

Total: 22,016,130,420  

Sales increase in the first year of plain packaging = 0.524%

Tuesday, 25 August 2015

The reverse paranoia of 'public health'

Via Clive Bates on Twitter, I see that Simon Capewell has written an article about 'internet trolls' for his newsletter. I don't follow Capewell on Twitter but I do occasionally see his green ink tweets and, weirdly, he sometimes retweets things I say ironically thinking that I'm being serious.

In recent months the UK Faculty of Public Health, of which Capewell is the president, has called for a ban on vaping in indoor places and a tax on sugar. As you might expect, this has not gone down well with a large section of the public. Some members of the public have told him so on Twitter and that makes them industry-funded trolls in the fantasy world of Public Health (Capewell uses the term 'Big Tobacco' three times in his short article, despite the fact that 'Big Tobacco' has no reason to care about sugar taxes and might be positively upbeat about vaping bans).
He writes...
...trolls usefully provide the "scream factor"; a graphic term coined by Mike Daube. Hence the stridency and volume of protest increases with the potential effectiveness of the proposed intervention (and therefore the feared reduction in consumption and industry profits). My colleagues thus knew they were succeeding when their respective proposals for tobacco control and sugar taxation elicited death threats...

There is no way of saying 'no' to these people is there? If you say yes, it encourages them. If you say no, it encourages them. And if you scream 'no' they know they're succeeding. You wouldn't want to go on a date with one of them, would you?

It strikes me that Capewell and his ilk are suffering from a sort of reverse persecution complex. Whereas a paranoid man is surrounded by people who like him but is nonetheless terrified that they secretly hate him and are in a conspiracy against him, the 'public health' zealot is convinced that people secretly like him and are only pretending to hate him because of some sort of conspiracy.

Just as nothing can build up the confidence of a man suffering from paranoia, nothing can shake the confidence of a self-righteous prig.

On wowsers

This is my submission to Australia's senate inquiry into personal choice and community impacts. I tried to keep it general and concise...

The issue of paternalistic lifestyle regulation is broad, but I would like to make two general points that I hope the committee will bear in mind during its investigation. The first relates to ethics, the second to costs.

A large part of the modern 'public health' agenda involves trying to stop adult consumers from engaging in behaviour that could pose a risk to their health. These activities do not typically pose a threat to the health of other people and, in a free society, the decision to partake in them should be a free choice for the individual, unencumbered by nudges and barriers from government.

The 'public health' industry is founded on two important lies. The first is that the choice to engage in potentially risky behaviours is not truly free because of external influences. The second is that the consequences of risky behaviour are substantially borne by people other than the individual involved. From these two lies, the 'public health' lobbyists conclude that in order to protect society, they need to protect individuals from their own poor decision-making.

Nobody would claim that people always make wholly informed and rational choices, free from any external influence. However, this applies as much to politicians and pressure groups as it does to private individuals. At heart, 'public health' lobbyists are - to use a wonderfully evocative Australian term - wowsers. They are unable to comprehend why anybody would want to use nicotine, get drunk or eat excessively and so they conclude that people do these things because they have somehow been coerced.

Advertising plays a large in their fantasy of corporate coercion. There is a huge amount of economic evidence showing that advertising does not increase the size of a given market and is only useful in increasing market share for a given company. Wowsers are either unaware of the evidence or choose to ignore it, preferring to believe that businesses somehow control the docile masses through clever marketing. At its lunatic extreme, this extends to a belief that logos and colour schemes on packaging can compel people to take up a notoriously risky and expensive habit.

The wowsers' obsession with putting taxes on products they don't like indicates that they also believe that low prices are coercive. This stems from a crude understanding of the law of demand, which says that demand tends to fall as prices rise. From this, the 'public health' lobbyists assume that higher prices help people to follow their 'true' preferences.

Like many of the wowsers' beliefs, this idea is contemptibly stupid. It should be obvious that depriving people of information (by banning advertising) and narrowing people's options (by raising prices) makes it more, not less, difficult for people to make a free choice. It should be quite obvious that wowsers are not really interested in free choice. They are only interested in people making the 'right' choice, as defined by the wowser community.

The claim that lifestyle choices place a burden on society and, therefore, that society should act to eradicate them, is equally false. It may amuse the committee to read some of the studies which claim that smoking and drinking place a multi-billion dollar cost on society to see how laughable these 'costs' are. Suffice it to say that lost productivity is not a cost to the taxpayer, nor are the emotional costs of being offended by a drunk, nor the many other ludicrous opportunity costs, intangible costs and internal costs that are crowbarred into such reports. I recommend Eric Crampton et al.'s working paper The Cost of Cost Studies to get a flavour of the nonsense peddled in this area.

In short, if somebody wants to eat too much and get fat, that is up to them. It is, quite simply, none of the government's business. The same applies to drinkers and smokers. Clearly, there are people who believe that there are too many obese people and too many smokers, but this has about as much relevance to policy as the fact that there are people who think there are too many atheists. No doubt some people believe that society would be better if there were fewer atheists, or fewer cats, or fewer football games, but in a liberal democracy we do not use the law to impose one person's preferences and prejudices over another's.

In short, a movement that seeks to regulate a person's lifestyle for their own good is unethical. It is also damaging to individuals and therefore to society. Single issue pressure groups are, almost by definition, interested in one aspect of life above all others. The 'public health' lobby regards longevity as the key goal of life and is prepared to sacrifice all other considerations. Whereas ordinary individuals make trade offs between pleasure and risk - costs and benefits - single issue campaigners see no benefits from the activities they seek to proscribe and ignore the costs of their policies.

Costs are often ignored because they are difficult to measure. The enjoyment people get from eating, drinking and consuming nicotine (their consumer surplus) are hard to quantify but are clearly important. They are, after all, the whole reason why people do the things of which the campaigners disapprove. Whatever benefits to health a policy may bring, the loss of consumer surplus that results from the activity being curtailed must be included as a cost.

Other costs are more obvious, but are downplayed or denied by the campaigners. Tax rises and over-regulation fuel the black market. Sin taxes take a disproportionate share of income from the poor. Excessive rules and bureaucracy damage businesses. Cycle helmet laws discourage people from cycling. Restrictions on e-cigarettes keep people smoking. 'Public health' lobbyists deny that these negative unintended consequences exist and devise studies to prove that black is white. I could give many examples of junk science and advocacy-based quackery being published in peer-reviewed journals on everything from obesity to plain packaging. The committee may wish to ask why so much of it is directly funded by the taxpayer.

This last point is worth underlining. The 'public health' agenda is the product of a small elite who think they know best for the masses. It has never been a popular, grass roots movement. The people involved have every right to voice their opinion and agitate for political change, but taxpayers should not be forced to fund their activities.

Sunday, 23 August 2015

A letter to the Telegraph

A 'policy advisor' from Cancer Research UK has written to the Telegraph to disagree with an article I wrote which argued against handing out e-cigarettes on the NHS. The letter contains a few factual errors so here's a quick rebuttal.

SIR – Christopher Snowdon suggests that taxpayers shouldn’t foot the bill for e-cigarettes. Yet taxpayers do exactly that for the costs of smoking. The costs of tobacco use in England are £13.8 billion a year, far exceeding the £7.6 billion in tobacco duty collected in 2014-15.

It is tiresome to see societal costs being mistaken for costs to taxpayers over and over again, but I'll assume good faith and imagine that CRUK are being stupid rather than dishonest here. The £13.8 billion is a figure devised by the think tank Policy Exchange a few years ago. I have written about it before. It includes various dubious costs, such as more than £5 billion in lost output due to smoking breaks. Even if you think smoking breaks cost the economy £5 billion (and I don't), it is clearly not a cost to the taxpayer. Lost productivity costs are ultimately borne by employees, ie. smokers in this instance. They are not external costs and they are certainly not costs to the state. Taking the Policy Exchange figure and comparing it to the amount collected in tobacco duty is an apples and oranges comparison.

The £7.6 billion figure cited by CRUK is simply wrong. In 2014/15, the government collected £9.5 billion in tobacco duty. VAT of twenty per cent was charged on the duty, leaving a total of £11.4 billion. This doesn't include the VAT paid on the product itself, nor does it include any of the revenues that stem from the manufacture and retail of tobacco products.

The £7.6 billion figure is the amount of tobacco duty, absent of VAT, collected on home-produced cigarettes. It does not include imported cigarettes, rolling tobacco, cigars or other tobacco products. It is a pretty amateurish mistake to make. Is CRUK deliberately trying to mislead us here?

The idea that the tobacco industry, the architect of this epidemic, pays a fair share is a myth.

Tobacco duty isn't paid by the tobacco industry. It is paid by consumers, ie. taxpayers. The tobacco industry pays corporation tax, but CRUK doesn't mention that and it is fairly insignificant compared to the billions paid by smokers. There is no doubt whatsoever that the £11.4 billion paid in tobacco duty vastly outstrips the cost of smoking to the government. Smoking not only makes the government a fortune, it also saves the government a fortune.

Tobacco is the leading preventable cause of cancer worldwide. E-cigarettes are almost certainly far safer. The EU Tobacco Products Directive is not “meddlesome and counter-productive”. Instead, it will create a system where e-cigarettes can be licensed as a medicinal product when evidence shows they may be effective in helping people to stop smoking, which kills two in three long-term users.

It's interesting to see the 'kills two in three' factoid being repeated as fact. This comes from a single Australian study published last year. All previous estimates have estimated that smoking kills a quarter to half of all long-term users. Isn't that enough? Does CRUK really have to use one outlying study to inflate the risks of smoking?

That is a minor point, however. The real issue is whether the TPD is meddlesome and counter-productive. It is, but not because it 'it will create a system where e-cigarettes can be licensed as a medicinal product'. We don't need the EU for that and nobody really wants it, apart from the pharmaceutical industry and people who hate e-cigarettes. The TPD is counter-productive because it will ban a vast array of fluids and devices for no good reason. It will ban advertising for no good reason. The effect of the EU's idiotic hyper-regulation will be to create e-cigarettes that nobody will want to use.

Vapers need to remember that CRUK lobbied hard for this. Indeed, they wanted the EU to go much further.

When Public Health England put out a not-as-bad-as-it-could-have-been report about e-cigarettes last week, quite a few people fell for the public health racket's good cop/bad cop routine. I have even seen one e-cigarette company raising money for CRUK. I hate to be the bearer of bad news, but there are very few good cops in the racket. ASH, Public Health England, CRUK, the Faculty of Public Health - you name 'em - would all be very happy with medical regulation of e-cigarettes. That's what they lobbied for for and they're the reason the TPD is the way it is. They are incorrigible liars and meddlers and always will be. The fact that there might be some some even worse people in other countries doesn't change that.

Friday, 21 August 2015

Lifestyle regulation

Still on holiday. The following is a short article I wrote to explain what lifestyle economics is all about and why it matters. You may be interested to compare it with this article from the newly formed UK Public Health Network which says that the word 'lifestyle' should be banned because it implies that people are free.

If market liberals stand idly by as the state sets prices, restricts commercial speech and demonises industries (and their customers), they will stand for anything. Under the pretext of ‘public health’, basic levers of competition—price, content and marketing—are increasingly falling under state control. With the advent of minimum pricing and plain packaging, the possibility of the government dictating how much a product sells for and what it looks like has become very real.

These developments are of no little concern to free marketers and social liberals. We are told, for example, that the obesity “epidemic” requires us to accept “a more invasive role for government.” The European Union openly discusses the need for “lifestyle regulation”. When New York mayor Michael Bloomberg decided that it should be against the law to sell a pint of Coca-Cola, a professor of medicine declared that: “The trivial issues of personal freedom in this case pale before the public health and welfare exigency.” Although it is predicted that one in three children born today will live to the age of 100, we are told that our health is at risk like never before from “non-communicable diseases” caused by our lifestyles. In the face of this “crisis”, we are expected to sacrifice liberty as if we were on a war-time footing.

Some would argue that the liberties under threat are of a minor nature, or are only of concern to the industries involved. But it is not the businessman who suffers most when prices rise and choice is restricted—he may find ways of profiting from both—but the consumer. And whilst it is inevitable that when authorities infringe on liberty, they begin with products and activities which are controversial or obscure, liberals recognise that there is an important issue of principle at stake that goes far beyond the unpopular and perhaps unsavoury test case. It therefore falls to liberals to defend “trivial issues of personal freedom”. If they do so, the bigger issues of personal freedom often take care of themselves.

This is not merely a philosophical position. The hazards and failures of state paternalism can be shown empirically, and the Lifestyle Economics workstream will put hard evidence at the heart of all its publications. Even if we accept that policy should be viewed through the narrow lens of ‘public health’, many of the interventions recommended do not work on their own terms. Every man-made law must overcome the law of unintended consequences and the law of demand. Time and time again, we see well-intentioned but ill-considered policies backfire by fuelling the black market, exacerbating poverty and encouraging more harmful consumption.

Adam Smith said that he had “never known much good done by those who affected to trade for the public good”. The same might be said today of those who purport to act in the public interest today, whether they be self-appointed protectors of ‘public morality’ or those who work in that nebulous and ever expanding industry of ‘public health’ which today provides the mandate for almost limitless state interference in what we eat, whether we smoke, how much we exercise, how much television we watch, how many items of fruit and veg we eat, how many units of alcohol we drink, whether a price is too low or too high, if a packet of crisps is too large or a pack of cigarettes too colourful, or a pint glass too tall.

Free market liberals have warned of the dangers of ‘slippery slope’ regulation for many years. They argued that the treatment being meted out to smokers would one day be dished out to consumers of any product which carries a risk to health or morals, however small. “Should the State dictate how many sausage butties I have for breakfast?” one prominent doctor asked rhetorically in the Times. “Should the Health Minister be e-mailing me about my five-a-day broccoli and bananas?” His answer? “Yes and yes.” “If the advertising of tobacco can be banned because smoking harms the individual,” wrote another public health professional, “should not all advertising be much more circumscribed because the consumption it engenders harms the planet?” With fizzy drinks, ‘junk food’, alcohol, meat, cars and sugar now being lined up as “the new tobacco” we start this programme from halfway down that slippery slope. All but the most pious abstainers from vice now find themselves in the cross-hairs of some single-issue pressure group or other.

When the writer George Ade reflected on how prohibition had conquered America in the 1920s, he recalled that “the non-drinkers had been organising for fifty years and the drinkers had no organization whatsoever. They had been too busy drinking.” Ordinary consumers are often too busy to defend their lifestyles against well-organised special interest groups. Businesses often spend too much time protecting their narrow interests in the short term and fail to see the bigger picture. The Lifestyle Economics workstream aims to show that bigger picture and to reaffirm that the interests of consumers are best advanced by the provision of accurate information, low prices and a wide range of choices in a competitive marketplace.