Time to tax soda?

Moderated by Rick Badie

Sweet tea, peach cobbler and soft drinks. No matter the product, many Southerners love sugar. We’re also often fat and unhealthy, reasons proponents like our lead columnist favor a tax on sodas and other sugary drinks. Today’s companion piece offers an opposing view that questions the efficacy of beverage taxes and suggests alternative measures to curbing obesity and disease.

Tax sodas for public good

By Jim O’Hara

These days in public health schools, the epidemic of type 2 diabetes, obesity, tooth decay and heart disease are studied as the real cost of colas and other sugar drinks. It’s also why cities, states, and some in Congress are proposing sugar drink taxes.

In 2010, the Centers for Disease Control and Prevention reported that type 2 diabetes — the type usually caused by diet and obesity — accounted for almost 95 percent of the adult cases of diabetes in Georgia. Medical costs for diabetes in 2007 totaled $3.3 billion in Georgia and lost productivity accounted for another $1.8 billion. Each case of diabetes costs Georgia’s Medicaid program $3,200, or $372.6 million in 2007.

With almost each new scientific study, the case for the link between sugar drinks and type 2 diabetes grows stronger. The federal government’s 2015 Dietary Guidelines Advisory Committee comprehensively reviewed the scientific literature and concluded:

“Strong evidence shows that higher consumption of added sugars, especially sugar-sweetened beverages, increases the risk of type 2 diabetes among adults and this relationship is not fully explained by body weight.”

Moreover, the consumption patterns that lead to this increased risk of type 2 diabetes are what the industry promotes with its ever-present and ubiquitous marketing. Sugar drinks are still the default option on too many restaurant kids’ meals, and box stores’ promotional “family dinners” come with 2-liter bottles. Consuming sugar drinks regularly – one to two cans a day or more – can increase the risk of type 2 diabetes by 26 percent.

Finally, communities of color and lower economic standing are those who bear the burden of these soda-related diseases. In 2013, obesity prevalence in Georgia was a little more than 30 percent, but for African-American adults it was 38 percent.

Those are the numbers and facts behind the human stories of illness and suffering that have made sugar drink taxes a compelling public policy choice despite the industry’s chorus of calorie balance, consumer freedom and regressiveness. For instance, the University of Connecticut Rudd Center for Food Policy and Obesity calculates that taxing sugar drinks at a rate of one penny per ounce would raise more than $465 million annually in Georgia.

Investing those resources in prevention and treatment programs in Georgia, as well as physical activity initiatives, would offset the social costs that the sugar-drink manufacturers have pushed on their customers in the guise of cheap prices and pleasure.

If the economic modeling done for the impact of excise taxes on sugar drinks is correct, such a levy would have the additional health benefit of reducing consumption. CDC reported that in 2012 almost 23 percent of Georgia adults said they drank more than one regular soda a day – a rate just about guaranteed to increase the prevalence of type 2 diabetes in the Peach State.

And that brings us to another favorite industry argument: the sugar in soda is just like the sugar in a peach. Except it’s not, as anyone who has eaten a peach or drunk a cola knows instinctively. That peach contains fiber and nutrients; the cola has neither for all its momentary pleasure. Moreover, science now tells us that the momentary pleasure in the brain occurs while the liver is overwhelmed and stores the excess sugar as fat.

Cheap soda has taxed this nation dearly. It’s time to tax it back.

Jim O’Hara is director of health promotion policy at the Center for Science in the Public Interest in Washington, D.C.

Soda taxes unpopular, ineffective

By Kevin Perry

Activists who want government to decide what we eat and drink have pushed soda taxes onto consumers for years now. They’ve not had much success. The reason is that people reject them.

Since 2009, more than 30 states and cities across the country have proposed or introduced beverage taxes. All failed except for one, in Berkeley, Calif.

Why have they failed?

People don’t want government in their shopping carts. Consumers have consistently voted down soda taxes in referendums and pressured lawmakers to abandon the idea. People know that once politicians slap a discriminatory tax on one item in their grocery carts, then more items will be taxed too. It’s a slippery slope that would allow governments to raise prices on grocery bills every time they need money for spending programs.

That kind of regressive tax policy hurts poor and middle-income families most and it won’t solve the reasons behind the budget deficits that have led many lawmakers to propose beverages taxes. Raising prices artificially on beverages hurts small businesses and mom-and-pop stores most and costs jobs.

Taxing one food or beverage won’t make anyone healthier, either. The states of West Virginia and Arkansas enacted excise taxes on soft drinks years ago and both states have continued to rank in the top 10 most-obese states in the country. States with no soda tax, such as Colorado and Vermont, continue to rank among the least-obese states.

A July 7 story in The Atlanta Journal-Constitution quoted an activist saying recent proposals in Illinois and Vermont are indicators the “the tide has turned” in favor of raising taxes on beverages.

Yes, a proposal was floated in Illinois, but no legislation was assigned to a committee, no hearing took place and no vote was held. In Vermont, an excise tax on beverages was abandoned after nearly 15,000 Vermonters and more than 200 small businesses joined a coalition to voice opposition to the idea. The Vermont Legislature instead passed a package of various tax hikes that included removing the sales tax exemption on a range of products, including both diet and regular soft drinks.

Pro-tax activists say that a tax on soda in Mexico shows there may be momentum for imposing soda taxes on consumers in the United States to address public health challenges like obesity. But again, Mexico raised taxes on several things (food, soft drinks, capital gains, sales, income) as part of a massive tax package to fill a budget deficit amid a steep decline in revenues from the state-owned oil industry. It was not a soda taxand public health had nothing to do with it.

Sales of beverages may have dipped in Mexico as a result of the tax. So too did jobs. As for health, there is no evidence that the Mexico tax helped a single person lose weight.

That is because raising taxes on common grocery items simply does not lead to changes in the behaviors that nutrition scientists tell us cause obesity or diabetes. What works is empowering consumers to achieve balance in their diet through education and accurate information.

Last fall, America’s leading beverage companies launched the Balance Calories Initiative with a goal to reduce beverage calories consumed per person nationally by 20 percent by 2025. We’ve put clear calorie information on all of our cans, bottles and packs and are doing so on more than 3 million company-controlled vending machines, fountain equipment and retail coolers nationwide. We’ve launched Mixify™, a consumer awareness and engagement program that talks to teens about the importance of balancing what they eat and drink with what they do.

These are meaningful efforts that will have real impact in Georgia and across America. Policymakers should find ways to promote balance in our lives and abandon old ideas of raising prices on common grocery items. They don’t work and are deeply unpopular with the public.

Kevin Perry is executive director of the Georgia Beverage Association.

Our “polycentric” economic future

By Jeffrey K. Haidet

This past June, the Metro Atlanta Chamber announced the Atlanta Metro Export Plan, a program that will stimulate economic growth by helping small- to mid-sized business begin exporting their goods and services. It follows a blueprint already instituted by other U.S. cities wishing to further tap the dynamism of global markets and help home-grown businesses expand their consumer base beyond the borders of our great metropolis. It is a positive move and one that is certain to attract new and deserved attention to Atlanta’s great entrepreneurs.

Atlanta has had its hand in global commerce for much of its history. As the capital of Georgia, we’ve called ourselves the business capital of the Southeast for decades. We built the world’s busiest airport and play headquarters to some of the world’s most recognizable brands. From Iceland to Australia, Egypt to Korea and back again, Atlanta’s biggest companies are well-known and well-respected around the world.

However, one doesn’t need to be a global conglomerate to expand across borders. Today, enterprises of all sizes are operating with an international perspective and market potential is largely unhindered by geography. A product developed in Kazakhstan can make it to store shelves in Atlanta almost overnight (maybe even within hours) and vice versa.

The broad reach of all markets and their actors is the new normal. Far-flung market places will have a direct impact on our local economy. We once spoke only about the relationship between Main Street and Wall Street, but that is now only part of the picture. This is our polycentric future.

Polycentrism is a way of thinking that encourages a plurality of independent centers of importance within a single organization. It encapsulates a commitment to a global future where opportunity is not limited by culture or geography.

Looking at the business landscape in a polycentric way really means that a corporation may not have one headquarters or a dominant national culture. It means drawing on talent from diverse backgrounds, regardless of geography.

While this may sound like some futuristic vision, it is happening today, here in Atlanta or anywhere else. Like it or not, we are now firmly and forever entrenched in the global economy.

New and robust markets await our attention. Just look at China, where more than 160 cities have populations greater than one million. By comparison, the United States has nine. According to The Economist, the average annual rate of growth for African countries was 5 percent over the past decade, including the global financial crisis.

The business environment of the 21st century is polycentric. It has no dominant culture, no national headquarters and no specific geography. Business leaders are no longer limited to local or even our national market forces. The only constraint is imagination.

This astonishing transformation will only gain momentum.

Our polycentric future, where far-flung marketplaces, cultural differences and changes in behavior thousands of miles away have a direct and sometimes immediate impact on our local economy, should be embraced. In Atlanta, we have a lot to offer. Marketplaces that were out of reach only a few years ago are today eager to have us usher in this new era of commerce.

The time has come to celebrate this new normal and help Atlanta embrace its polycentric future.

Jeffrey K. Haidet, co-chief CEO of Dentons US, is a board member of the metro Atlanta and Georgia chambers.


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