30.12.07

WE DON'T WANT HER, YOU CAN KEEP HER. (Apologies to Ross MacLean and Arthur Richardson). New Zealand denies residence permits to applicants with too large a body mass index. A critic of the policy notes New Zealand's invocation of a welfare-economics-paradigm-like argument, "So the main argument was that fat people cost the health care system more, in a country that has nationalized health care." There's a longer exegesis of the argument at Free Exchange.
Why exactly is obesity a public health issue? Well, when, by force of law, you externalise responsibility for providing a good, such as health care, then the effects of all individual choices that affect the cost of providing that good for the individual are thereby transformed from internal to external effects. If you, like Mr Dubois, are in the grip of the blithe assumption that reducing negative externalities by raising the cost of the behaviour that causes them is simply what government does, then obviously my gluttony and sloth are public problems. Because public policy made them public problems! So, obviously, it's up to the government to fiddle with prices to manipulate our behavior in order to minimise its impact on the tax-financed national budget.
Or, by extension, to prohibit entry to people whose presence is likely to consume additional public-health resources.

But is the external effects argument really correct? Insurance companies experience-rate policyholders for risks, and private clubs can decide whom to extend, or not to extend, membership benefits. The decision of a country to admit an immigrant appears to have more in common with the decision of a private club to welcome a member.

There's also something troubling about the country, whether by due process or by administrative fiat, effectively becoming a monopoly provider of insurance, and that therefore introduces an externality. Perhaps more on that next year.

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