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The War On Junk Food



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David Frum says it’s going to be the successor to the war on tobacco. David thinks of snobbery as one of the links between these wars.

But I thought that Michael Greve made a smart point to the contrary a few months ago:

“Widespread speculation that the tobacco settlement might generate copycat campaigns against other industries focused on industries that shared tobacco’s injury-inducing characteristics and its ill repute, meaning that no New York Times reporter would go near the products–guns, for example, and fast foods. Both industries, however, have suffered only a few wildcatter lawsuits by cities and private plaintiffs. No organized assault has materialized.

“Instead, the litigation industry has zeroed in on financial brokerage houses and pharmaceutical firms–both of which service the intelligentsia, and the latter of which actually save lives. Neither cultural explanations nor product characteristics appear to explain the litigation industry’s choice of targets. Nor does the targeted industries’ conduct explain that choice. . . . For an explanation, and for a prediction concerning next-on-deck industries, one must look to the political economy of the matter. First, targeted industries will typically be unable to differentiate their products along jurisdictional lines and to control cross-border arbitrage (meaning the unauthorized sale of products from one jurisdiction into another, with much of the proceeds going to middlemen). Second, targeted industries will tend to be highly concentrated. . . .

“The regulatory ambitions imply that the states and the targeted industry as a whole must be able to reach an agreement.

“That ability rises in proportion to industry concentration. At the time of the tobacco settlement, the four major manufacturers supplied 99 percent of the American market. That enormous concentration made it possible to bring the industry to the bargaining table and to monitor the firms’ compliance with the agreement. At the other extreme, the fragmentation of the fast food and snack food industry explains why that otherwise vulnerable sector has so far escaped an organized attack. McDonald’s and Wendy’s can deal and comply. Thousands of smaller competitors do not, and the business is not amenable to entry controls. The litigation industry’s attacks on investment and pharmaceutical firms are effectively a bet that those sectors are sufficiently cohesive and concentrated to cut a deal” (footnote omitted).



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