Sunday Commentary: Beverage Industry Sure Acts Like Soda Tax Works

Sugary Beverage

Sugary Beverage

While there has been a philosophical opposition to the soda tax by some, for the most part the push back has come on the issue of whether a soda tax will actually work. We hedge our bets on this by considering two factors – the question of whether a soda tax will reduce consumption, and the opportunity to use the revenue from a soda tax to help treat the effects of obesity and diabetes, particularly on underprivileged youth.

But while the empirical evidence is admittedly thin – Berkeley is the only jurisdiction to implement the tax so far and it has been in effect for less than a full year, and Mexico has some evidence that their tax has reduced consumption – we have perhaps a far more reliable gauge of effectiveness.

Earlier this year Davis became the first in the nation to eliminate soda as the default beverage in kids’ meals at restaurants. We supported the effort. But in a lot of ways it was a very subtle change, forcing parents to opt-in for soda consumption rather than opt-out. It certainly made me more cognizant of the issue and brought some people awareness as to just how much sugar are in beverages.

But, in the scheme of things, it was low-hanging fruit. The beverage industry did not come to Davis, pressure politicians, and purchase ads about default beverages at restaurants in Davis.

A lot of us underrate the importance of what I call political body language. It is not what they say that matters but rather what they do. In their ad, the beverage industry argues that the tax will “hurt the poor,” will “harm small businesses,” and will “not stop people from buying soda.”

Mayor Pro Tem Robb Davis pointed out that these were similar to arguments made when cigarette taxes were implemented, but it turned out that small businesses survived cigarette taxes.

But let us consider the bottom line: that taxes “do not stop people from buying soda.” No one believes that taxes are going to “stop” people from buying soda. That is not even a question. Cigarette taxes did not stop people from purchasing cigarettes. The real question is whether they reduce consumption. It is a subtle change of language from “stop” to “reduce,” but it is critical to analyzing the situation.

Here is what we know. The American Beverage Association poured $9.1 million into San Francisco in order to defeat Proposition E. It eventually spent $2.4 million to try to defeat Measure D, the Berkeley soda tax. Remember that Berkeley is far smaller than San Francisco.

An independent news site noted, “The American Beverage Association California PAC, which is funding the campaign, donated $1.4 million but has actually spent more. The campaign is also carrying $947,433 in accrued expenses. The bulk of the money is going to campaign literature, advertising, a website and campaign, and public relations consultants.”

A 2014 New York Times article reported, “The beverage industry has spent more than $117 million nationally to defeat or roll back soda taxes since 2009, said Michael F. Jacobson, the executive director of the Center for Science in the Public Interest, a nonprofit organization. The battles have been fought in Congress and in courthouses: in Maine, Texas and New York; in Philadelphia and in Washington; and in such small towns as Telluride, Colo., and El Monte and Richmond in California.”

So, while the words of the beverage industry are that soda taxes “do not stop people from buying soda,” their body language and the amount of money they are pouring into these campaigns to prevent cities from enacting soda tax says something very different.

Dr. Harold Goldstein told the Vanguard a few weeks ago that he expects the beverage industry to pour $2 million into Davis to stop the soda tax. They have already pumped money into advertising in an effort to dissuade the city council from even putting the measure on the ballot. They were even able to “roll” one of the biggest proponents of the measure.

Logic tells us that they would not do that unless they had very good reason (probably backed by studies and consultant reports) that the soda tax would harm their bottom line, and the only way it would harm their bottom line is if it ended up reducing consumption – not by a little, but by a lot.

Based on the behavior of the beverage industry, we can infer that consumption will go down.

While it is important to understand that a soda tax is not going to cure obesity and diabetes, there is a strong link between the two.

Dr. Goldstein told us that the research suggests that the proliferation of sugar beverages over the last four years has greatly contributed to obesity problems. From 1977 to 2001, people consumed about 278 calories more and about 43 percent of those calories came from beverages.

He argued that consuming just one soda a day increases the risk of obesity by 50 percent and of diabetes by 30 percent.

A 2010 study published by the National Institute of Health found that, “Consumption of sugar-sweetened beverages (SSBs), which include soft drinks, fruit drinks, iced tea, and energy and vitamin water drinks has risen across the globe. Regular consumption of SSBs has been associated with weight gain and risk of overweight and obesity.”

It concluded, “In addition to weight gain, higher consumption of SSBs is associated with development of metabolic syndrome and type 2 diabetes. These data provide empirical evidence that intake of SSBs should be limited to reduce obesity-related risk of chronic metabolic diseases.”

Do we have enough evidence here? The beverage industry is pumping millions into these campaigns because they believe that soda taxes will harm their bottom line – and despite their rhetoric, that means that people will greatly reduce consumption, and the link between sugary beverage consumption and obesity and diabetes is well established.

The beverage industry’s money, therefore, is telling you that they believe a soda tax will work. Shouldn’t you take that into account?

—David M. Greenwald reporting

Author

  • David Greenwald

    Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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54 comments

  1. “He argued that consuming just one soda a day increases the risk of obesity by 50 percent and of diabetes by 30 percent.”

    “The beverage industry’s money, therefore, is telling you that they believe a soda tax will work. Shouldn’t you take that into account?”

    Take a “logic” class, David. This propaganda could have been written by BP or Frankly.

    I strongly disapprove of the use of “scare tactics” in political discussion.

  2. Thanks for this article David. I believe that we now have some evidence from all three of the spheres from which individuals draw when gathering information to make decisions. The personal, the factual, and the business/ public/ political realms are all represented.

    David and I have presented personal examples of our own experiences with soda “addiction”. In my case, a 10 lb weight reduction and normalization of blood sugars with the only change being giving up my one soda  per day habit.

    There has been factual information presented by David, Dr. Goldstein and myself that there are national, county and local increases in the metabolic disorders which are associated with obesity, consumption of sugar based products in general and sugar based beverages specifically, and lack of exercise. We all freely acknowledge that this is a multifactorial problem. However, there are very specific physiologic reasons for focusing on sugary beverages as has been pointed out several times.

    Now, with this article, David has pointed out that at least one very large and powerful industry, through their actions over time, seems to agree that these measures do have an ability to result in a substantial change in people’s purchasing behavior. To me this speaks much more powerfully to the legitimacy of this claim than my comparisons to what happened over time with the cigarette industry. Maybe for some of you, these oppositional actions on the part of companies whose business model you presumably respect for its success, will have more impact than anything those of us in individual and/or public health could ever have said.

     

    1. David and I have presented personal examples of our own experiences with soda “addiction”. In my case, a 10 lb weight reduction and normalization of blood sugars with the only change being giving up my one soda  per day habit.

      So which is it Tia Will, one soda a day or four sodas a day?

      Tia Will 
      December 16, 2015 at 6:03 pm

      Alan
      “the rhetoric of “sugar delivery system” is not something I can take seriously,”
      You mean that you do not believe that people can consume more sugar in the form of beverages in a day than they could consume in the form of funnel cakes, or cookies, or candy bars ?  Really ! I used to readily down 4 12 oz sodas during the course of a day. How many people do you know that consume that much sugar in the form of these other goodies daily ? You don’t believe in the more rapid absorption of sugars from the digestive tract if they are unaccompanied by other nutrients in the tract at the same time ?  These are not issues for debate. These are the way the body works. Why do you think that you can have liquids closer to the time of surgery than solid foods. It is precisely the bodies rate of absorption that makes this necessary.

      1. One thing I learned when I became a diabetic is that liquid sugar is worse thank other forms. Why? First, the sugar takes less time to get to the blood stream and therefore much more quickly spikes blood sugar levels. Second, it is much less filling than solid forms and therefore doesn’t satisfy hunger which leads to a higher consumption of calories and sugar.

        1. OK, David, and this is not meant as a gotcha’… would you have favored a soda tax two years before you were diagnosed?

          I’ve never been (after age ~ 14) a soda drinker, and my parents didn’t push me to drink soda, due to concern of dental caries.  They let me self-regulate.  But it was easy for them to do so, as they knew I didn’t have much of a “sweet-tooth”… my mom threw out ~50% of my uneaten Halloween candy… in April… afraid it was “stale”.

          I kinda’ don’t “have a dog in this fight”… but you may find me arguing against questionable arguments.

      2. BP

        So which is it Tia Will, one soda a day or four sodas a day?”

        It was both. Until my first pregnancy, I easily drank three to four sodas daily. At the time of my first pregnancy, I deliberately decreased my intake to one daily, a habit that I maintained for the next 20 years. That was when I was diagnosed with pre-diabetes and stopped entirely. It was in the next year that I lost the additional ten pounds getting me back to my post pregnancy target weight.

    2. What about all the people with type 2 diabetes who don’t drink soda? How will a tax help them? Not everyone with diabetes is a soda drinker – or even someone who eats “excessive” sugar (however that would be defined).

        1. WHOA!… I thought the point was to avoid obesity and/or type II diabetes!  

          Maybe we should divert all tobacco taxes away from education/prevention of addiction, and spend it all on those who have lung cancer, COPD, mouth cancer, and heart disease related to smoking/using tobacco products!

          Was presented as a revenue source, but now seems City imposes, MAYBE collets a small admin. fee, and passes the money to the County and/or private sector..

      1. LCrane

        I appreciate your concern for those who already have the disease. They already need to be under the specific care of a physician and diabetic management team to help manage their illness. That does not mean that we should not be taking steps to help others prevent this problem from developing.

  3. Biddlin

    I strongly disapprove of the use of “scare tactics” in political discussion.”

    Honest question. I am not seeing what you are characterizing as “scare tactics” in this article. Can you clarify ?

    1. “He argued that consuming just one soda a day increases the risk of obesity by 50 percent and of diabetes by 30 percent.”

      Total BS, intended to scare folks.

  4. I found this post while looking for something else, very interesting:

    Tia Will 
    December 16, 2014 at 7:31 pm

    BP
    There is some evidence that I cannot reference this evening, but can find if someone is truly interested that switching to artificial sweeteners has its own set of problems in promoting more craving for sweets and thus is not a good substitute for sugary beverages.  If anyone is really interested, I can provide the data later. Just let me know.

    1. Biddlin

      I don’t know where he got those numbers.  Do you ? It seemed high to me, but since what he is quoting is increased risk, not incidence, it may be that he has numbers to back this up.

      This is actually one pet peeve of mine in the presentation of data. People who present the information frequently switch back and forth between increased risk,  and actual incidence and  prevalence, making the assumption that because they know which they are referencing, others will as well.  This leads readers to the conclusion that it is “total BS” when what it really is is a misunderstanding about which factor is being discussed. This is the fault of the author, not the reader, but may not represent an “intent to scare” but merely a lack of clear communication.

    2. BP

      There is some evidence that I cannot reference this evening, but can find if someone is truly interested that switching to artificial sweeteners has its own set of problems in promoting more craving for sweets and thus is not a good substitute for sugary beverages.  If anyone is really interested, I can provide the data later. Just let me know.”

      I have one comment and one question about your posting this quote at this time.

      First, the question. Are you interested enough in the information for me to look it up at this time ?

      Now for the comment. Please note that in none of my posts, comments or information on this topic have I ever recommended that anyone switch from a sugar containing soda to a sugar free soda, nor to juice, nor to any other sweetened beverage whether naturally or artificially sweetened. I specifically counsel my patients not to make this substitution.

      With the exception of the athletes, who are not the population at risk here, I do not recommend any sweetened beverage as I see them all as non-foods and not necessary for any nutritional purpose. I also am not targeting the occasional treat. If a person wants an occasional coke instead of an occasional cookie or candy bar, or doughnut, no harm done. It is when these substances are treated as the norm, and consumed on a daily ( sometimes multiple servings daily) basis as the beverage of choice that people run into problems.

  5. hpierce

    would you have favored a soda tax two years before you were diagnosed?”

    Can’t speak for David, but for me, I would definitely have favored this tax before I got my diagnosis. Dunning was right about one thing with regard to me. I knew that what I was doing was harmful long before I gave up the habit. This speaks to the nature of an addiction. The person knows the destructive nature of what they are doing, but still continues the behavior.  I would have welcomed another incentive for both myself and my patients to give up our bad habit. And perhaps more powerfully, I have heard many smokers say that they approve of cigarette prices increasing since they believe it will deter their own children from taking up their terrible habit.

    1. Tia… I’ll re-phrase for you, as you changed the ‘field of play’… would you, Tia, have supported a soda tax before you did your medical training?

      Unless you assume, a significant # of likely voters will have had medical training…

      Be very aware that putting the tax question on the ballot, even with a primary or general election, will have a real cost to the City… a “sunk cost” if it fails… it’s not a “freebie”.

      I don’t know what that cost would be, but suspect it’s in the tens of thousands.  Maybe someone could ask County Elections for an estimate.  Perhaps the supporters of the tax proposal could do a fund-raiser, so the City isn’t out money if it fails…

      1. hpierce

        Tia, have supported a soda tax before you did your medical training?”

        I don’t know the answer to that question. I think it would have depended on how the information was presented. If I had believed that it would be useful in the prevention of an important disease, I believe that I would have supported it. Had I been more swayed by the arguments ( with no ability to sort out the truth from the fiction) I might not have supported it.

        The reason that I am so vocal, is my belief that perhaps if enough people get a balanced and honest view of the problem, they will place community health over the short term economic interests of those who profit from these products. I also believe that from the medical perspective, I am presenting an honest and balanced view. I have been very straightforward in stating that sugary beverages are not the only problem but only one piece of a multifactorial issue and that this measure is no panacea but only a small step in a better direction.

      2. hpierce

        I don’t know what that cost would be, but suspect it’s in the tens of thousands.  Maybe someone could ask County Elections for an estimate.  Perhaps the supporters of the tax proposal could do a fund-raiser, so the City isn’t out money if it fails…”

        I am wondering whether, if the cost is in the “tens of thousands” it still might be worth the cost of it being on the ballot in terms of the increased awareness of the issue to the general ( non medical ) portion of the population. An estimate of how much value has been already placed on public awareness would already be available, as David pointed out, in how much the soda industry is willing to expend on defeating the measure even being placed on the ballot.

         

  6. So, while the words of the beverage industry are that soda taxes “do not stop people from buying soda,” their body language and the amount of money they are pouring into these campaigns to prevent cities from enacting soda tax says something very different.

    Wrong.

    “Soda” is in the industry category of beverages.  Have you even looked at the number of beverage choices on the shelves?  The soda manufacturers are always fighting to maintain or grow market share in each of their products and product categories.  When social justice do-gooders try to engineer society with the use of taxation, they just cause market shifts.  In this case they will cause the soda manufacturers to lose market share to other products in the beverage category that are not taxed.

    The huge taxes on cigarettes cannot be proved to have had any material contribution to the reduction in cigarette use since there was already a declining trend in use as more people were educated on the dangers of prolonged cigarette use and more effective kick-the-habit products became available… and we passed so many Orwellian smoking bans and restrictions.  However, the huge taxes on cigarettes ironically probably have contributed to more childhood obesity and diabetes as low-income smokers paid their big cigarette tax bill and had less money in their accounts to pay for health food choices.  Also, the massive taxes on cigarettes along with all the anti-smoking regulations spurred the development and growth of the e-cigarette industry which certainly has led to more market-share decline for the cigarette manufactures.

    The point here is that you cannot make this claim for the reason that the soda manufacturers are fighting soda taxes is that they know it will simple cause people to stop drinking sugary beverages.  They are fighting what would be an unfair business tax that would give advantages to other beverage categories… some containing just as much sugar.  For example, expect energy drinks to gain market share.  The first mistake made by the social justice crusade is calling it a “soda tax”.  The second mistake is proposing another tax.  The third mistake is to not designate the tax revenue as being restricted to programs to help solve childhood obesity and diabetes.

    Bottom line is that this was a crappy idea from the start.

    1. The soda manufacturers are always fighting to maintain or grow market share in each of their products and product categories. When social justice do-gooders try to engineer society with the use of taxation, they just cause market shifts. In this case they will cause the soda manufacturers to lose market share to other products in the beverage category that are not taxed.

      I’m pretty sure it’s the same companies. They’re diversified into non-soda options as well. The main contributors to the American Beverage Association are here: https://www.opensecrets.org/pacs/pacgave2.php?cycle=2014&cmte=C00100107

      1. They are always working to maintain or increase market share for each and every product they produce… and to maintain or increase total market share for all products in the beverage industry.  That is why they will always fight a tax.  The same would be true for any product company or industry having a special sales tax levied on their products.  It is the primary reason that trade associations exist… to fight back business-harming overreach from government and government-class.

        1. Frankly

           It is the primary reason that trade associations exist… to fight back business-harming overreach from government and government-class.”

          I think that you are ignoring the root cause here. There would be no need at all for government regulation or “overreach” as you call it, if all manufacturers and trades were diligent in ensuring that their products were actually beneficial to their target consumers and were fairly priced and accurately portrayed in their advertising.  Likewise, there would be no need for police if everyone obeyed the law.

          Now you are a firm believer in the police, because you want to be kept safe from criminals. I also support the police. Where we differ is that I believe that it should be against the law ( criminal ) to sell products known to their manufacturer to be harmful but being portrayed through advertising as though they are health promoting or at least innocent.

        2. Almost anything that can be injested is harmful if over-ingested.  So to follow your line of thinking we would need to tax and label everything as harmful… except fluoride apparently.

          I understand that some people fight demons being unable to control their impulses, cravings and decisions to over-consume or ingest harmful substances.  I have a few close family members with this challene.  But your… doctor, mothering, nanny-government, liberal-save-people-from-themselves… views of the world are at odds with mine that value human development to greater self-determination, self-control and healthy choice-making.  You clearly have low expectations of people to overcome their demons and make healthy choices (nobody is forcing anyone to drink soda), and so you have high demands of business and government to “take care” of them.

          I see that as fomenting destructive dependency and diminished human development.

          But then that would tend to serve your self-interest having plenty of subjects to doctor, mother, nanny and save from themselves.

  7. I wonder if a less-controversial intermediate step would be to require prominent calorie labeling on the menu of all sodas and soda sizes offered — perhaps even a little placard with calorie values next to the cups in fast food restaurants. Studies like this one: (http://www.ijbnpa.org/content/10/1/21 — forgive me, I’m not an academic, and it’s been years since I’ve had to formally “cite” anything) show that calorie labeling reduces consumption across the board.

    A labeling mandate would require very little effort and impose very little cost on business owners, and would not unfairly punish consumers (with a tax) who want to have a little soda instead of a dessert or an extra taco.

    I would like to see menus with calorie counts for every item — I believe it’s harder to make an argument against providing information than against new taxes.

    1. I would like to see menus with calorie counts for every item — I believe it’s harder to make an argument against providing information than against new taxes.

      I agree, but something tells me that will never fly with our local feel good liberal social engineers.

      1. Gotta’ tell you BP, in my opinion, your response would have been more effective without all the adjectives at the end.  Keep it up, and those of us ‘on the fence’, just might vigorously support the tax.  Right now, I’m inclined to vote against it…

        1. You would shift from against to for just because you get irritated with the words used by the opposition even though the facts and information have not change?  I would expect better from you hpierce.  With all due respect, that is what we expect from children not highly-intelligent adults.

      2. BP

        “I  agree, but something tells me that will never fly with our local feel good liberal social engineers.”

        Well, if you are including me in that group, then you have not been reading very carefully since I already stated several threads ago that I also agree with the labeling suggestion. I do not think a soda tax would preclude or in any way deter the placement of a labeling requirement, so why not do both ?

    2. Somebody made a similar comment before, and with or without the tax, I support “labels”… tobacco has always been taxed (at various levels), and it has more recently required “warnings”…  alcohol has always been taxed, and more recently, warnings… for soda, perhaps “consumption of this beverage may lead to diabetes (or, obesity, or tooth decay)”… “consumption of soda may lead to addition to soda”… etc.    I’m not being facetious.

  8. BP

    Now are you okay with that Tia Will?”

    As already stated, I do not see the two as mutually exclusive and would prefer both. I would also support each individually.

      1. BP, why either/or?  Cigarettes are both taxed and labeled.  Is that not a reasonable precedent?

        BTW, we did not KNOW that reducing the amount of smoking would reduce the incidence of lung cancer when the decision to tax tobacco was made, nor did we KNOW that when the decision to label was made.

      2. BP

        Please tell me how this is a compromise ? I have already answered your question. I simply will not be bullied into saying that I do not support a tax.

        1. Bullied?  Too funny, I’ll bet there are many Davis citizens who feel they’re being bullied by the we know what’s best for you social engineers in this town.

  9. Glad to see a discussion of product labeling here.  Dr Goldstein can give you his experience on the matter.  He has worked to get labels on sugary beverages in California.  He and others have failed to date to see such legislation passed.

    Any guesses about who has actively opposed such labeling?

    Does anyone think that product labeling is an “unfair tax” or is it about helping develop more informed consumers?  Why would the beverage industry fight for more information to be shared?

    As far as data here is a quote from F. B Hu in Obesity Reviews in 2013 (International Association for the Study of Obesity).  It concerns a number of meta analyses (RCT and prospective studies):

    A recently published meta-analysis of RCTs commissioned by the World Health Organization found that decreased intake of added sugars significantly reduced body weight (0.80 kg, 95% confidence interval [CI] 0.39–1.21; P < 0.001), whereas increased sugar intake led to a comparable weight increase (0.75 kg, 0.30–1.19; P = 0.001). A parallel meta-analysis of cohort studies also found that higher intake of SSBs among children was associated with 55% (95% CI 32–82%) higher risk of being overweight or obese compared with those with lower intake. Another meta- analysis of eight prospective cohort studies found that one to two servings per day of SSB intake was associated with a 26% (95% CI 12–41%) greater risk of developing T2D compared with occasional intake (less than one serving per month). Recently, two large RCTs with a high degree of compliance provided convincing data that reducing consumption of SSBs significantly decreases weight gain and adiposity in children and adolescents.

     

    1. I am sure that the beverage industry (like any other rational business) doesn’t want ANYTHING to reduce consumption, including calorie labeling on menus, etc. However, beverage industry folk would have a much harder time arguing against “requirements for information” than against size prohibitions or taxes, both of which grab the third rail (for some) of “nannying” and/or “ever more taxation.”

      Ideally, IMO, we would end up treating all classes of food and drink equally, with calorie info listed on menus for all items sold.. that would further negate an argument that beverages were being unfairly singled out while desserts, giant portions, etc. were getting off scot-free.

      Labeling EVERYTHING and everything PROMINENTLY would get us some of the societal and individual health benefits of reduced calorie consumption, but would also preserve freedom of choice and freedom of competition between all sources of calories for sale. Additionally, compliance costs on businesses would be minimal.

      1. I agree.  Now you are making too much sense.  I am fine with product labeling.  Ironically this was one of the things that helped kill the previous Tia Will crusade to put fluoride in the drinking water.  The FDA identifies fluoride as a poison and requires all products containing fluoride to be labeled so.

  10. Is there really a question as to what will happen if a soda tax is passed? Anytime you increase the cost of something less of it will be used. This is true for everything except for potatoes in Ireland. Soda tax equals less soda being purchased. Increase the cost of labor and less labor is used. Increase sales tax and less things are sold. Basic economic concept.

    1. Sam – not quite.  There is a price equilibrium for all products.  And some products have price/cost elasticity… i.e., people will still buy it if the price rises and falls.  Gasoline is an example of a product with pretty strong price elasticity.

      People want soda they will purchase soda… unless the price is significantly increased.

      And if it is significantly increased there will be other consequences.  For example, since fast food restaurants rely on beverage sales for revenue they will have to rise the prices on food with decreased beverage sales.

       

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