Congratulations to Americans Against Food Taxes for producing a political issues ad that is accurate. The group opposes a one-cent per-ounce tax on sugary soft drinks that Congress is eyeballing to generate more revenue. The ads claim the regressive tax would hit those who least can afford it the most.
On the flip side, sugar tax advocates say the products they are targeting pose a significant contributor to juvenile diabetes, high blood pressure and obesity and could generate $15 billion in the first year to fight the diseases. The tax would apply to soft drinks, energy drinks, sports beverages and many juices and ice teas, but not sugar-free diet drinks.
The major fallacy in both arguments is that sugar is the boogie man when added ingredients such as fructose and corn syrup are the real devils.
The issue is so hot Congress removed the proposal from its health reform legislation to consider it as a separate revenue issue later this year. Translation: The beverage industry lobby smacks a powerful punch.
The New England Journal of Medicine Wednesday reported findings of a study that the tax would not only raise millions but also have a significant effect on reducing weight and other health risks. The study cited research on price elasticity for soft drinks that has shown that for every 10% rise in price, consumption declines 8 to 10%. A similar study on cigarette taxes showed a decline in smoking among adults by 2% and teenagers 7%.
From the New York Times:
John Sicher, the publisher of Beverage Digest, a trade publication, said that a two-liter bottle of soda sells for about $1.35. At 67.6 ounces, if the full tax was passed on to consumers, that would add 50% to the price. A 12-can case, which sells today for about $3.20, could rise by $1.44, a 45% increase.
“A one cent per ounce tax would create serious problems and potentially adversely impact sales for the American beverage industry,” Sicher said.
The Times also quotes Kevin W. Keane, senior vice president of public relations for the beverage industry:
“When it comes to losing weight, all calories count, regardless of the food source,” Keane said. “The bottom line is that the tax isn’t going to make anybody healthier. It’s not going to make a dent in a problem as complex and serious as obesity, and we’re certainly not going to solve the complexities of the health care system with a tax on soda pop."
Susan K. Neely, president of the American Beverage Association, takes it a step further. She maintains that soft drinks don't play a role in the obesity epidemic - that consuming too much is the problem. "Soft drinks are just a fun beverage along with a lot of other beverages and foods that we like to eat or drink. It's eating too much of something that is a problem," she said.
Kelly Brownell, director of the Rudd Center for Obesity at Yale University said in an interview with ABC TV that a penny-an-ounce tax would have an immediate and powerful impact on the nation’s elevated obesity rate. He called it a home run.
He said that a tax was justified in part because conditions like obesity and diabetes are often treated with public funds through programs like Medicaid and Medicare. Revenue from the tax could help pay for such care.
According to the ABC report, the average American consumes 50 cans of soda pop per month.The heart of the argument for limiting sugary consumption is Americans consume too much -- about 22 teaspoons daily or 355 calories per day when only six teaspoons are needed, according to Rachel K. Johnson, lead author of the statement published online Monday in the American Heart Association journal Circulation.
I have a simple solution to the sweet tooth addicts. Instead of sugar, add Splenda or any other artificial sweetener.
What boggles my mind is that health experts tend to downplay the worst contributors to sugary and fatty foods. It's not sugar by itself at work. It is the variety of ingredients including sugar, corn syrup, fructose, dextrose, molasses or evaporated cane juice and anything hydrogenated which are on the nutrition labels of all packaged food and beverages, according to Lona Sandon, a dietitian at Dallas' University of Texas Southwestern Medical Center.
As in many debates, there are self-serving claims which amount to a mountain of BS. This one is quoted from Bloomberg News in the New York Times article.
Muhtar Kent, the chief executive of Coca-Cola, was asked about the tax on Monday during an appearance at the Rotary Club of Atlanta and he responded by calling it “outrageous.”
“I have never seen it work where a government tells people what to eat and what to drink,” Kent said. “It if worked, the Soviet Union would still be around.”
Coca-Cola is the world's largest beverage company in an industry which contends its revenues are flatlining and cannot withstand any tax increase. According to its own financial statements, Coca-Cola total revenues were $8.627 million in the second quarter of 2009 compared to first quarter earnings of $7.169 million. Annual revenues for 2008 were $31.944 million over the previous year's $28.857 million.
Big Coke is doing quite well despite the threat of a socialistic takeover.