Government Failure and Private Failure

One of the points that is so hard to get over about the classical liberal beliefs is that governments and bureaucracies can and do fail. It isn’t enough to say that the market, or private actors, or companies, have failed or could do better. We also need to show that government or bureaucratic action would be better, for they fail just as much, perhaps more often.

Here’s The Guardian complaining about the way in which the food labelling scheme promoted by private companies relies upon unrealistic portion sizes to give misleading information about dietary guidelines.

But the new industry labels, which tell shoppers how much sugar, fat
and salt products contain as a percentage of their total "guideline
daily amount" (GDA), use figures that are "misleading", the National
Heart Forum says.


Tesco, Nestlé and Kellogg’s are among the food giants criticised for
their labelling by the report, which includes accusations that industry
daily amounts are based on arbitrary portion sizes and lead to products
appearing healthier than they are.

In
one example of what the health group report calls "misinformation"
adult guideline amounts are routinely being used on products targeted
at children, even though children’s targets are different to those for
adults.

Here’s what the bureaucracy did when evaluating foods that would be banned from being advertised on children’s TV. The list of foods banned is here, the why here.

Yes, the bureaucracy used unrealistic portion sizes to give misleading information about dietary guidelines. Like a 3 ounce serving of Marmite to show that it had too much salt.

So, what should we do? Praise the food companies for copying our Lords and Masters? Or say that, as those private companies only seem to be out by a factor of x2 or x3, whereas the bureaucrats were out by x20, do we once again applaud the ability of spontaneous organisation to get things closer to reality than bureaucrats widdling away our tax money?

6 responses

  1. An excellent posting, on the great difficulty (even impossibility) of government succeeding in doing good beyond some point, irrespective of their good (or at least seemingly good) intentions.
    We live in a good country, with a better standard of living and higher life expectancy than ever before.
    That is apart from the increasing pain of over-zealous government, that wishes to waste an an ever higher portion of our work and accumulated wealth.
    So what is the real problem?
    Best regards

  2. Well said Nigel. Just to repeat:
    “We live in a good country, with a better standard of living and higher life expectancy than ever before.”
    Is this why government spends its time banning Marmite adverts? Just to keep itself employed.

  3. So, the manufacturers’ labelling scheme is bad because it requires the consumer to be able to do 3 things:
    * read the label
    * apply primary school mathematics
    * THINK!
    Though, given the results of this government’s education (, education, education) policy, maybe they have a point……

  4. One of the endlessly amusing things is to watch Tim act like he’s a puir wee oppressed thing, raising a candle of truth in a sea of heresy. Rather than just another right-wing economics blogger in a world dominated by a Washington consensus that has already convinced most people that government is more prone to failure than private industry.
    Tim adds: Come see the oppression of the working classes! Help, help, I’m being oppressed!
    Indeed, I am.

  5. Ed – no, the manufacturer’s scheme also requires people to keep a tally of all the nutritional values of all the food they eat in a day, which is obviously a ridiculous thing to ask.
    Tim – the FDA traffic lights scheme is NOT based on portion sizes at all. It is based on % of ingredients…

  6. John B: For those who care about what amount of what they are eating, how can they not consider portion sizes and the sum total of everything they eat? Don’t diabetics already have to tally their daily food intake? Most people do not need to be so precise, i.e. having a rough idea of the contents of their diet is sufficient.
    http://www.scientistlive.com/food/20061201/packaging-and-labelling/2.3.276.281/16808/traffic-light-packaging-helps-healthy-choice-eating-decisions.thtml
    Waitrose marketing director:
    “… traffic light colours – as recommended by the FSA – was their preferred approach. It also leaves plenty of room on the back of pack for all the information on Guideline Daily Amounts that our customers expect from us.”
    So it seems the traffic light scheme is not sufficient by itself…..

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