Soda Tax, An Idea That’s Bubbling All Over
Everyone is excited about soda taxes, except for the soda companies and me. Kelly Brownell, a longtime obesity researcher at Yale, and Thomas Frieden, the New York City health commissioner wrote a persuasive argument (pdf) for the imposition of soda taxes in a recent issue of the New England Journal of Medicine that has got everyone talking.
Brownell and Frieden say, among other things, that taxes on sweetened beverage will curb the consumption of soda and other sugar-laden drinks:
Taxes on tobacco products have been highly effective in reducing consumption, and data indicate that higher prices also reduce soda consumption. A review conducted by Yale University’s Rudd Center for Food Policy and Obesity suggested that for every 10% increase in price, consumption decreases by 7.8%. An industry trade publication reported even larger reductions: as prices of carbonated soft drinks increased by 6.8%, sales dropped by 7.8%, and as Coca-Cola prices increased by 12%, sales dropped by 14.6%.5 Such studies — and the economic principles that support their findings — suggest that a tax on sugared beverages would encourage consumers to switch to more healthful beverages, which would lead to reduced caloric intake and less weight gain.
Indeed, reducing soda consumption will more than likely reduce obesity levels:
Sugar-sweetened beverages (soda sweetened with sugar, corn syrup, or other caloric sweeteners and other carbonated and uncarbonated drinks, such as sports and energy drinks) may be the single largest driver of the obesity epidemic. A recent meta-analysis found that the intake of sugared beverages is associated with increased body weight, poor nutrition, and displacement of more healthful beverages; increasing consumption increases risk for obesity and diabetes; the strongest effects are seen in studies with the best methods (e.g., longitudinal and interventional vs. correlational studies); and interventional studies show that reduced intake of soft drinks improves health. Studies that do not support a relationship between consumption of sugared beverages and health outcomes tend to be conducted by authors supported by the beverage industry.
I agree with the studies that show drinking soda is at the root of many negative behaviors and outcomes. But, I disagree with how to tackle the excessive consumption problem. Why not get to the root cause of why those beverages “may be the single largest driver of the obesity epidemic”? The question becomes how come those drinks are so cheap and plentiful? If you look at the consumer price index of the last decade the prices of unhealthy foods has actually decreased while everything else has gotten more expensive. Looking at that sort of data, one cannot help but consider that there are many more factors to the obesity epidemic than just soda consumption.
Brownell and Frieden admit that the wide gap between the affordability of soda and in-affordability of fruits and vegetables contributes to the rise of obesity in the US. However, their expose was meant for public policy change, not general discussion. And, unfortunately, it is easier for legislators to just to add a tax rather than create a whole discourse and compendium of legislation and programs to combat the obesity epidemic.
A long term course of action would be, of course, to dismantle the system that favors the affordability gap in the first place. Dismantling the system would mean removing the subsidies and that means fighting a lot more than just the soda companies. The governments would have to take on nearly the entire industrialized food system (all those HFCS products) and states that rely heavily on those subsides, like Iowa.
As a mere band-aid, the soda tax might possibly maybe just might work to reduce levels of obesity. Brownell and Frienden estimate that the average person would lose a whole two pounds a year if soda consumption decreased by 13%.
However, it would be better if policy discussions centered on overall consumption patterns rather than just sweetened beverages. Studies on obesity show the causative factor (again and again) to be the aggregate diet choices that people are forced to make on tight budgets. They eat the calorie dense and nutrient light foods (ie junk foods) because it is what they can afford. True, soda doesn’t have to be a part of the diet. But as a focus point for weight reduction, it’s really just the tip of the iceberg.
So, are they in it for the money…?
A third consideration is revenue generation, which can further increase the societal benefits of a tax on soft drinks. A penny-per-ounce excise tax would raise an estimated $1.2 billion in New York State alone. In times of economic hardship, taxes that both generate this much revenue and promote health are better options than revenue initiatives that may have adverse effects.
Or is this a way for the city to do something about obesity (and make a little bit of money on the side) while the national government remains laggard on issues of subsidies. Money from the soda taxes could be appropriated to further benefit health programs. Brownell and Frieden explain:
Although a tax on sugared beverages would have health benefits regardless of how the revenue was used, the popularity of such a proposal increases greatly if revenues are used for programs to prevent childhood obesity, such as media campaigns, facilities and programs for physical activity, and healthier food in schools. Poll results show that support of a tax on sugared beverages ranges from 37 to 72%; a poll of New York residents found that 52% supported a “soda tax,” but the number rose to 72% when respondents were told that the revenue would be used for obesity prevention. Perhaps the most defensible approach is to use revenue to subsidize the purchase of healthful foods. The public would then see a relationship between tax and benefit, and any regressive effects would be counteracted by the reduced costs of healthful food.
The idea of a soda tax seems to be catching on nationwide. David Leonhardt, at the New York Times, notes that one of the authors, Dr. Thomas Friedan, was recently appointed to head the Centers for Disease Control and Prevention and is in a position to promote real legislation on the matter. He writes:
So one of the nation’s top public health officials is now a fierce proponent of a soda tax. Meanwhile, other Obama advisers and some Senate staff members have been talking about such a tax — which wouldn’t apply to diet soda or real juice — as a way to help pay for expanded health insurance. Among 15 options for paying for health care reform, a new Senate Finance Committee analysis lists a “sugar-sweetened beverage excise tax.”
The promise of real healthcare reform certainly sweetens the argument for soda taxes.
May 22, 2009
Tags: food, food event, Health, nutrition, obesity, soda, subsidies, sugar Posted in: Health, Politics, Science & Technology
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