Happy Meal Ban: McDonald's Outsmarts San Francisco | Hacker News Reader

Happy Meal Ban: McDonald's Outsmarts San Francisco

blogs.sfweekly.com

41 pointspitdesi68 comments

My class on legislation in the first year of law school (which was quite innovative, as at that time most law schools didn't require a course in legislation at all) was taught by one of the legal scholars who literally wrote the book on the subject.

http://store.westlaw.com/eskridge-frickey-garretts-legislati...

Almost everyone, "conservative" or "liberal," who took that course began the semester supposing that passing a new law is an effective way to solve a social problem. By the end of the semester, hardly any of us thought that anymore.

Agreed. I work in the health care industry and it's amazing how gov't regulation (well intentioned as it may be) creates incredibly perverse incentives.

If you want to read up on this type of thing, just read how ASP (average sale price) reimbursement for Medicare drugs works. Doctors and drug wholesalers make money hand-over-fist because of the system.

Capitalism creates wealth by matching buyer and seller. If kids want happy meal toys (thus parents want them too) they'll get them one way or another, regulations be dammed.

This story and the comments here are quite interesting and I'm really torn on this.

On one hand, I think the government does have a job to intervene when negative externalities affect society (like obesity has). On the other hand, as this story demonstrates, they clearly suck at intervening.

On a personal level, I don't care what McDonalds does because I don't take my kids there (I have 3 kids under 7). But I care about obesity being a drain on society and a healthcare issue we all have to share. McDonalds, well, they care about profits.

Nothing stops the government from simply changing the law to fix such loopholes. So, it's actually safer to craft something vary specific and deal with attempts to get around the intent than craft something really generic. AKA, no store which generates 95+% of it's revenue from food may sell, give away, or market Toys. would probably have worse downsides than simply creating an ineffective law.

I wonder if there is some political philosophy to describe my thoughts on this - but I never understood why government just didn't set up taxes on things it didn't like, and directly allocate the revenues from those taxes to the opposite side of whatever stance it took (versus going towards general expenses).

For example with this, tax the happy meal and other fatty kids foods, allocate revenues earned from that tax directly to childhood obesity prevention campaigns. McDonald's still makes money, kids still can get happy meals, and childhood obesity is reduced through funding effective programs.

They tried this with the tobacco taxes / settlements and just decided to spend it any way they wanted.

In Hungary they are taxing too fatty, too sweet and too salty foods. Oh.. and drinks with high coffeine content.

http://www.chew.hu/welcome_to_the_maybe_healthy_a.html

Some foods' salty version costing twice as much as the non-salty version (for example peanuts).

I can't say we like it...

"Negative externalities" should never be a license to abridge individual liberty. What about the "negative externalities" of smoking, drinking, listening to punk music, homosexuality, or reading subversive literature?

No thanks, you can keep your nanny state to yourself. I may not approve of my fellow citizens feeding their children happy meals but by god I will defend their right to do so just as strongly as I'll defend anyone's right to love who they desire, listen to what they want, read what they want, and say what they want.

I completely disagree with what you wrote, but yon don't deserve to be downvoted.

You don't believe that the "negative externalities" of smoking or drinking should be addressed in any way? Even through (say) taxes/surcharges on said products?

If there are indeed "negative externalities" then there are almost always better ways to address them than limiting individual liberty. I wasn't joking when I mentioned listening to punk music and homosexuality as also having negative externalities. Almost every behavior has some negative externality, even breathing. If we are to use the excuse of control of "negative externalities" as a lever to modify individual behavior then that lever becomes almost trivial to use to create a police state where every behavior is within the realm of the government to regulate.

You must really hate that new $600/yr insurance premium for all smokers, right.?

When industries are powerful enough to ignore markets and regulation they ARE governing you with their choices.

In what way does what I said imply that?

That’s the first I’ve heard of personal obesity as an externality. Frightening idea. What if someone lives a lifestyle that makes them more likely to contract an STD, say?

Per the other big thread of the day, such a lifestyle is reducing Amit Gupta's life expectancy.

Well, if that STD happens to cause cervical cancer (which HPV does), then some states may consider requiring girls get a vaccine against such a virus. And indeed that debate is going on right now.

Regardless, STDs aren't a byproduct of some Fortune 500 company's quest to grow shareholder value. Obesity is.

> Regardless, STDs aren't a byproduct of some Fortune 500 company's quest to grow shareholder value.

None of the bathhouses ("while the band played on") were Fortune 500, but they were profiting.

It's fair to suggest that the behavior would have happened without bathhouses, but that same argument applies to McDs.

Note that the nutritonal information that McDs passes out has been more effective than the bowls of condoms were.

No, I'm not referring to HPV.

I don't understand how obesity is a drain on 'society,' except through state-financed medical care. I don't suffer anymore because other people are fat. Why should I be able to control what they eat?

Medical costs are almost 20% of US GDP. even if you are in private medical care, you're still subsidizing obese insurance customers in the same risk pool to some extent. Plus you have to factor in the wider economic effects of lost productivity, non-food consumption and so on. For example, most hospitals beds are now expected to accommodate patients weighing 400 lbs., the cost of which is distributed across all patients even though relatively few patients actually weigh that much. Don't have the numbers to hand right now, but when I did a rough estimate of causes vs. costs of mortality it came out something like a 1% drag on GDP from obesity.

Diabetes, which is a good proxy for obesity-related mortality, costs >$100 bn a year already: http://www.forbes.com/2010/01/13/kramer-obesity-nutrition-in...

> Medical costs are almost 20% of US GDP. even if you are in private medical care, you're still subsidizing obese insurance customers in the same risk pool to some extent.

Not if the risk pool is priced correctly. If it's priced correctly, there are no cross-group subsidies.

> you have to factor in the wider economic effects of lost productivity

Not at all. They're paid less. Surely you're not going to argue that they owe "full productivity"? If so, there are lots of other things that affect productivity, so what makes obesity special?

> and a healthcare issue we all have to share.

Any "sharing" is a choice. Why are they obligated to make that choice less expensive? If you don't like their expenses, don't pay them. And, don't take their money.

> But I care about obesity being a drain on society

Surely you're not arguing that people "owe" society full-productivity or somesuch?

They prefer food. If that's a problem for you, perhaps you should wonder why food is more important to them than the things you want them to value.

Kudos to McDonald's for circumventing a stupid law. The government needs to stop meddling in everyone's life.

I don't disagree but I think the larger point here is Government is painfully ineffective at meddling. So much so that they end up making the problem they were trying to prevent worse.

I mean, this was a pretty obvious work around for McDonalds. If the SF City Council was serious about this they should have seen it coming from a mile away.

Could it be that MacDo just called the SF city council's bluff? I'm not sure this is evidence that the city council sucks at intervening: the council did something straightforward to communicate their intent. The company brazenly thumbed its nose, so they must believe the council to be utterly weak-willed or powerless.

If the city council is not bluffing, they'll push for more restrictive laws. And in another time and place, perhaps health, safety, and zoning commissions would come knocking.

Hopefully an equally (it not more) stupid follow up by the city council would be shot down when coming to a vote. Perhaps McDonald's is banking that lightning won't strike twice?

Have you seen the rising obesity statistics? If the government doesn't take it on as a public health issue, who will?

http://www.wikinvest.com/images/3/37/Obesity.jpg

Obesity is a private health issue. It is not communicable and poses no danger to anyone except the people who freely choose to eat too much.

The only reason obesity becomes a public issue at all is because the non-obese are forced by the government to pay for the health care of the obese. This problem has a very simple solution - no medicare/medicaid for fatties, and make it easier for insurance to charge fatties and fitness freaks different rates.

It's not communicable from person to person, but it's certainly communicable from your environment to you.

edit: Is this such a controversial statement? Does it bear explanation?

What we eat is not solely a matter of willpower. It is influenced by what sort of food is available. It is influenced by what sort of food is easier or harder to obtain. It is influenced by how hungry we are. How hungry we are can be changed by how stressed out we are, or by what we ate yesterday, or last week, or how active we have been lately. It is even influenced by what we see others eat, what is culturally acceptable to eat.

So yeah - obesity isn't communicable from person to person like the flu is, but it is something that your environment has a huge influence on.

And yet somehow obesity was hardly a problem for thousands of years in human history. People need to stop making excuses for their poor eating and exercising habits and take responsibility for their actions.

I think it's awfully naive to claim that the environment you're raised in has no effect on your actions later in life.

Somehow a person eating food can't control themselves but your desire to change their behavior is objective? Your preference for bad legislation that was transmitted to you contagiously from your environment. Perhaps you would like someone to change your environment so you take better political actions. And so on.

In medicine, communicable == infectious. Obesity is not infectious.

You are correct that people's choices depend on what options they have available and their utility function. Some people will eat pie if it is available, and some people prefer (pie, obesity) to (no pie, healthy weight).

How does hindering their choices help anyone?

According to several studies, obesity is in fact "socially contagious" -- or at least, correlated: if a friend of yours becomes obese, you are now 57% more likely to as well.

http://www.time.com/time/health/article/0,8599,1646997,00.ht...

http://www.usatoday.com/yourlife/food/diet-nutrition/2010-11...

Facebook, Farmville, and other viral apps are "socially contagious" as well. Someone call the CDC!

You make the common but fundamental mistake that fat and fit are mutually exclusive. There are plenty of fit fatties and vice-versa.

I am dumfounded that beliefs such as these have such a strong and widespread hold these days.

This is a puritanical mindset. A mindset of the evil of sin and the necessity of combating sin through the coercive power of the collective. It is no less dangerous than puritanical religion ever has been (witch-hunts and all). This belief system escapes notice as a puritanical, regressive ideology because it does not come bundled in the familiar forms: married to a social conservative longing for the past or embedded within the larger structure of a religious belief system replete with supernatural pantheons and creation myths. But in the end it works out to the same thing: the institutionalization of morality. And as always it will end with the same results: repression, subjugation, abuse of power, and misery.

If you decide that individuals do not have the liberty to decide their own diets and take care of their own personal health then where do you draw the line?

As an amateur bodybuilder and fitness enthusiast I'm well aware of the so-called obesity epidemic. There are plenty of ways the government can help, mostly by eliminating special interests.

1. Eliminate all farming subsidies, starting with those for corn and other unhealthy foods.

2. Eliminate special interest group influence on politics, such as the frozen food industry getting congress to declare pizza a vegetable.

3. Provide proper health science education in schools, starting at a young age. Teach kids what food is, how it works, the side effects of poor eating habits, etc. Teach them about nutrients, exercise, etc. Do it in a scientific manor without demonization / judgement, unlike most (stupid) anti-drug programs.

4. Remove all unhealthy foods from food assistance programs.

Most methods of helpful government "intervention" are eliminating government intervention.

I'm with you on (1) and (2). Problem I have with (3) and (4) is that nutritional "science" has been wrong so many times in the past, e.g. a study finds that something (say, french fries cooked in lard) is bad for you, so an entire industry changes to use what they think is better (vegetable oil) and then we discover that not only is the new thing worse (trans fats) but the original thing wasn't that bad in the first place.

Regarding (3) and (4), do you believe it likely that nutritional science is wrong in their broad strokes, e.g. that a diet comprised of cheetos and bacon is good for you, while a diet comprised of green vegetables, rice and legumes is bad for you?

Nutritional science occasionally gets small details wrong, lard fries vs trans fat fries. They are spot on for most things, e.g. spinach vs fries.

The law of unintended consequences rears its ugly head yet again.

Only an unintended consequence if you accept the article's premise that a non-trivial number people actually went to McD's and only bought the toy, and those people will continue to go for the toy but buy the happy meal to get it. And feed it to their kid.

Seems dubious to me.

But McDonald's is still selling happy meals with toys in them in San Francisco. They are just selling them for ten cents more now. So the law is effectively moot.

It seems that the unintended consequence here is that the Ronald McDonald house is getting more donations than it used to. It not accomplishing the goal the law set out to accomplish certainly wasn't intended, but it wasn't an "unintended consequence" in the traditional sense.

Scofflaws deliberately seeking loopholes are not "unintended consequence." nwnted consequences, perhaps, but not unintended consequences.

An unintended consequence of a ban on toys with meals might be something bizzare like a rise in minivan accidents because kids full of caffiene and sugar have nothing to play with in the car and bug their parents while they're driving home from lnch.

San Francisco should respond by imposing a 10000% tax on the sale of toys from food service establishments.

Or by ceasing to make stupid laws.

I'm confused -- do kids actually clamor specifically for the McDonald's toys? Aren't there better and cheaper toys out there?

Kids.

The last numbers I know of are from 2003 but in 2003 Happy Meals accounted for about 20% of McDonalds Sales (Link found through Quick Google Search: http://www.fool.com/investing/small-cap/2004/09/03/the-steal...)

Apparently they distributed over 1.5 Billion toys in 2009 (Lftqgs: http://www.associatedcontent.com/article/1460556/mcdonalds_g...)

So I'd say yes

I was in McDonald's a few weeks ago and heard a parent say "we've been to 3 locations looking for this toy!" Apparently some kids want them bad enough to force their parents to go to extremes to get them.

Reminds me of Beanie Babies in the late 90's

McD made a boatload from a teeny beanie babies promotion:

"Estimates suggest that McDonald's made $250 million of sales on Teenie Beanie Baby Happy Meals during this promotion."

Link: http://www.associatedcontent.com/article/1460556/mcdonalds_g...

What ever happened to "no"?

Maybe the kid brought home an all "A" report card and the parent wanted to do something nice. Or not. Probably not. But I've been known to reward my kids with something they want if they have done something deserving a reward.

"I've been known to reward my kids with something they want" <-- if your kids asked you specifically for a mcdonalds toy, would you oblige?

My first two kids did. We stopped feeding them fast food and it stopped. The younger two clamor for carrot sticks ;)

Kids are a delicious target audience. The churn-rate is largely irrelevant because there's infinite supply of new little idiots.

s/Kids/Humans

"Aren't there better and cheaper toys out there?"

I'm gonna guess you haven't spent much time around kids ;)

How much a kid wants a toy is directly proportional both to how well it is marketed, and to how much their peers want it (which, since their "peers" appear in ads for the products, is really just a proxy for how well it's marketed). See http://en.wikipedia.org/wiki/Pogs#Popularity and http://en.wikipedia.org/wiki/Beanie_babies#Marketing_strateg...

How does Lego do marketing? I don't think I or my parents have ever seen a Lego ad in my life, yet I played with legos as a little kid and I still play with Legos :)

Lego seems to have plenty of ads at least in my area. If you watch kid's cartoons in the 5-9 age bracket you'll see a lot of their ads for special packs like Lego Space Adventure, etc.

Apart from whatever official marketing they do, they're also simply a very well-known and well-regarded brand. Even the word "Lego" is basically synonymous with the whole market segment they're in.

Finally, Lego sets are just addictive (as I remember well from my childhood). I think I got my first one by accident--it was a tiny $3 (or something) set because the matchbox cars I liked back then weren't available. This was years ago so the details are fuzzy, but I still remember which set it was :) After that I was completely enthralled by Lego and continued getting more and more for years. Ultimately, the only reason I stopped playing with them was because I got even more addicted to programming. That alone must supplement their conventional marketing by a large amount.

Absolutely right, ask anyone who was a kid during the initial (79 + 80s) Star Wars toy craze who went from store to store chasing the Jawa figure. Or you can ask my Dad and he will have a long critique of the situation.

Only time I ever heard my Dad utter MFer was after months of looking for the Jawa, which only one kid in the neighborhood had, we turned the corner at a K-Mart and found a whole isle of them.

It seems like it would be easy to redraft the law to close the loophole. I mean, I can't just walk in and donate $.10 and get a toy. They have gone from bundling a toy with the happy meal, to bundling an option to purchase a toy.

It's tough to legislate against every possible loophole in a law.

How? This sounds like a hilarious legal hack but the details were never revealed.

The article was quite clear. You have to donate 10c to charity (Ronald McDonald House) for the toy, instead of getting it for free. But you can only dontate if you get a happy meal.

Also, apparently you used to be able to buy the toys separately, which is no longer an option.

Ah thanks

When debating issues like this in my mind, I frequently flip-flop. I can argue both sides. On one side, I don't want a corporation taking advantage of the consumer by using immense resources to exploit a flaw in human behavior. On the other hand, I don't want the government deciding what is right and wrong for me. In doing so, the government draws an arbitrary line and uses it to promote and also defend its actions, ultimately limiting my rights.

This whole Happy Meal debate would be a non-issue if consumers didn't want Happy Meals. It turns out they do, so work-arounds work just like prohibition did not eliminate alcohol from our culture.

The government is elected to serve and represent the people. The people want Happy Meals (and alcohol) (and drugs sourced from Mexico).

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