Wednesday 14 April 2021

Alcohol labelling and rationality

The Sun reported yesterday that public health ‘nannies’ are planning on introducing calorie labelling on alcoholics drinks, including in pubs, bars and restaurants.  This has prompted understandable and predictable outcries, along the lines of: don’t we have more important public health issues to worry about, and is this an attempt to distract from the handling of the pandemic?

Edit: since I wrote this I've seen this piece on CapX, which presents these arguments very neatly - but (as you'll see from the below) in my opinion mistakenly or even disingenuously.

I’m interested in what this tells us about the state of alcohol policy debate in the UK, or more specifically England.  If you’ve come here for analysis on the ins and outs or rights and wrongs of labelling, you’re in the wrong place.  This is going to be a bit more pretentious than that – though I’d say more important in the long run.

Firstly, I should note that the framing above is classic whataboutery.  Two things are only set against each other as an argumentative device.  (I could say ‘rhetorical’, but I think this is actually argumentative.)

Think of two problems in your own life, that may or may not be related.  For me, say, I have an issue with a wisdom tooth that I need to get sorted, and I have a chronic problem with my ankle, which I sprained years ago, meaning I limp and struggle to run.  I don’t have to fully sort one of these problems before I think about the other, even if sorting one might help the other.  If I get the tooth sorted, maybe I’ll feel more like running and exercising, which might help the ankle.  But I shouldn’t stop exercising the ankle as if that will somehow mean the dentist can remove the wisdom tooth sooner.

It’s the same with these issues.  Set aside all the intricacies of who or what organisation is to blame for various issues in responding to COVID-19.  (Was it PHE or NHSE or the government more directly who failed to implement recommendations from Exercise Cygnus?  Would those even have been relevant to a coronavirus rather than a ‘flu, etc…)  If developing alcohol labelling is a good idea, and we have the resources to implement it, then we should do it.

Let’s take the issue of resources first.  On the face of it, it seems that we do have the resources and the costs would be reasonable (depending on the benefits).  Analysis of drinks and labelling/menus already exist, so we’re talking about tweaking something rather than inventing from scratch.

The Sun quotes a figure of £92m in costs, but I find it hard to see what this would be made up of (though I could be persuaded).  If there are additional costs, they should largely be in setup and this could be rolled out gradually, as labels and menus are regularly changed in any case.  The detail of this is important (e.g. do the producers provide things automatically, or do operators have to) - so it's not something that should simply be written off out of hand.  And interestingly the proposal seems to refer only to large operators of 250 employees or more, so we're not talking about a small independent free house having to develop their own labelling or menus.

And in fact it’s not ‘the booze industry’ that has been hit by COVID, as the Sun suggests, so much as the hospitality sector and specifically the wet-led trade.  The alcohol producers are doing relatively well at the moment and so should be able to afford this, and we know that alcohol is, in historical terms, very affordable and therefore a small one-off hit could be absorbed by the market.

This is obviously a simplification, and the detail could be argued with, but it’s certainly not enough to write the idea off to start with.

And we certainly shouldn’t tie this into the quite reasonable point that the hospitality industry has had a hard time through COVID restrictions.  I’m a supporter of pubs (and indeed of people’s freedom to get drunk) and I absolutely agree that they’ve been poorly served by COVID restrictions.  It’s nice to think that my own research and analysis is being used in analysis of what the government might have got wrong.

But if we’re talking about saving the off-trade we need to focus on ideas (like this or this) that might genuinely support it rather than continue to expand home drinking.  (I’m also slightly sceptical of the ‘reopen the pubs’ chant, when this may not actually be what frontline staff want – see slightly differing viewpoints here and here.)

So why is labelling a big deal?  On the surface, at least, it shouldn’t be.  The costs would probably be marginal, and I can’t see that it would significantly alter consumption patterns.  Think of sugar as a comparable issue to alcohol.  Soft drinks have had ingredients and information on them for years, but what really changed what people consume was a ‘sugar tax’ that prompted reformulation.

So if alcohol labelling is low cost and low impact, why does anyone care much?

This makes sense if we see the issue through the lens of realpolitik.  Imagine there are simply two diametrically opposed sides to this debate.  One wants the population to drink more (or at least spend more money on alcohol) – the ‘industry’ – and one wants the population to drink less – ‘public health’.  If this ‘public health’ measure succeeds, then the interests or industry are hit.  If it doesn’t, then the industry will expect the public health lobby not to stop, but to use the findings to argue that even more intervention in the market is required.  And hence (neo)liberal campaigners and policy commentators become interested.

Soft drink labelling ‘failed’, and led to the ‘sugar tax’; the ‘industry’ wants to avoid that for alcohol, as do economic liberals.

So this is, in a sense, such an emotive issue precisely because the likely impact is low.  But the debate is most interesting to me as it illustrates how ostensibly free market thinking is nothing of the sort.

Again as an oversimplification, the logic behind this kind of market liberalism is often presented as being about individual choices: in Millian terms, a person’s own decisions about their life are – except in extreme cases – by definition the best for them, as they know their own minds and competing interests.  In some formulations, this depends on those individuals having ‘perfect’ information on which to base their choices – which is where it would seem alcohol labelling is ‘rational’ and in-keeping with classical economic liberalism.

Indeed regulation and labelling of food and drink was a key plank of classic liberal approaches to regulate markets in order that they could work efficiently.  Based on what is largely a historical accident, we are told less about what is in drinks containing alcohol than their ‘soft’ counterparts.

But economic modelling and thinking has often become more aggregated and technical, distanced from this model of the individual ‘rational actor’, and focusing instead at overall outcomes.  This is where ideas of ‘neoliberalism’ come into play: what was historically seen as a means to an end – the market – becomes an approach to be protected in itself.  Where once the market was seen as a useful way of meeting individuals’ needs and wants efficiently, it is now seen as something to be prioritised and protected from interference almost as an article of faith.

Whatever is said about pubs, or individual drinkers, this debate about ‘nannying’ and labelling seems to have little to do with drinkers and their experiences.

It’s the ‘free market think tank’ the Adam Smith Institute that is quoted in the Sun piece.  Their quote states simply “Brits backing their locals are well aware that too many pints makes beer belly more likely.”  But that’s not consistent with their approach to advertising.

When alcohol advertising is criticised, it’s defended by these kind of commentators on the basis that it’s not aiming to expand the overall consumption of alcohol, but simply encouraging people to switch products – much like toilet roll advertising.  Advertising helps create that scenario of ‘perfect information’.

And yet the same claim could be made for providing calorie counts and other information for drinks.  Perhaps if I’m watching my weight, I might choose a Carling rather than a Stella.  What could be wrong with that?

We know this kind of brand switching can make a big difference in relation to alcohol risk more broadly: if you’re having 2 pints a night, and switch from, say, Greene King Abbot Ale (5%) to their IPA (3.6%), you’ll go from consuming over 39 units a week to 28.  Sure, that’s still double the low-risk guidelines, but it’s a considerable reduction (well over a quarter, at more than 28%).

This isn’t just an academic example; it’s a common harm reduction technique for people who are thinking of cutting down their alcohol consumption.  We already have the information about alcohol content to make that choice; but we don’t for calories.

So this reveals that this opposition to labelling can’t simply be about consumers/drinkers.  Even if we accept that this initiative would significantly increase costs, which I’m yet to be persuaded on, any cost needs to be balanced against potential benefits.

Advertising costs the industry plenty already, and this is absorbed by shareholders and customers.  Yet that kind of dispensing information is supported by the same people who oppose giving people more information about what is in their drink.

This approach, therefore, doesn’t have the consumer at the heart of the model.  In fact, they’re not mentioned as making a decision in any of this.  The philosophy simply states that it’s better at an aggregate level for a large company to make a choice about the information provided, rather than their government.

It’s hard to see how this is a consistent approach from the perspective of the consumer; it feels much more like the consistent thread is that these think tanks – and indeed the whole neoliberal approach – supports large companies over individual consumers or the overall system outcomes.  (And I say large companies pointedly, as the current proposal appears to only apply to companies employing 250 or more people.)

I look forward (but without much hope) to a clear, honest debate about the costs or benefits of this policy.

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