About this Issue
Research shows that it’s notoriously difficult to lose weight. Can public health initiatives help? If so, which ones? One school of thought holds that obesity is difficult to defeat even with government help, while another holds that the difficulties that so many of us have might be overcome - or at least mitigated - with a nudge from public policy.
This month we’ll consider some of the empirical evidence behind public policies that look to curb obesity. Our lead essayist is Christopher Snowdon of the Institute of Economic Affairs, who opens with a skeptical look at soda and sugar taxes. Joining him to discuss this month will be Baylen Linnekin of Keep Food Legal, Jennifer Harris of Yale University’s Rudd Center for Food Policy and Obesity, and Russell Saunders, a pediatrician and journalist.
Lead Essay
The Ineffectiveness of Food and Soft Drink Taxes
Extending “sin taxes’” to certain foods and soft drinks is increasingly seen as a practical response to obesity and obesity-related diseases. Several countries and most U.S. states have some form of tax on soda, candy, and/or fatty foods, but they have so far had little or no effect on population health. For a tax to be justified, it should be efficient, fair and effective, and that taxes on food and drink meet none of these criteria.
Effective?
On the question of whether obesity taxes are effective, it is generally accepted that higher prices lead to lower levels of consumption. If consumption of a given product directly leads to obesity, then it is reasonable to expect that higher prices could lead to lower rates of obesity. The obvious comparison, which is often made by those who campaign for food/drink taxes, is between cigarette taxes and lung cancer, but the comparison does not hold. Cigarette smoking is the main cause of lung cancer, and most cases of lung cancer are caused by cigarette smoking. By contrast, obesity is the result of consuming more calories than an individual burns off. Drinking soda is neither a sufficient nor a necessary cause of obesity, and consumers can easily switch to other high-calorie products if the price of one product rises. A cigarette smoker faced with unaffordable prices might switch to alternative nicotine products, such as e-cigarettes, smokeless tobacco, or patches - any of which would improve his health - but a Pepsi drinker can switch to beer, milkshakes, or fruit juice without reducing his calorie intake or lowering his weight.
Evidence of the efficacy of food and drink taxes is sharply divided between theoretical models (which tend to show a modest but significant effect on body weight), and studies of taxes which have actually been implemented (which don’t). The economics literature suggests that soft drinks have a price elasticity of 0.79, albeit with a very broad confidence interval, meaning that a price rise of 10 per cent should reduce consumption by 7.9 per cent.[1] A conventional economic model can therefore estimate the drop in consumption that would result from a price rise, and a more speculative public health model can estimate the impact on body weight and health outcomes. But even the more optimistic models, based on relatively high price hikes, claim quite modest changes in overall calorie consumption. One study found that a penny-per-ounce soda tax would reduce average energy consumption by just nine calories a day, for example.[2] Another model predicted that a ten per cent tax on milk and fizzy drinks would have even less effect.[3]
Advocates of such taxes argue that small changes in calorie consumption can have a meaningful effect on health over time. Real world evidence has found only a modest effect on consumption and little or no effect on health.[4] This is likely due to substitution effects; people simply consume calories from other sources. A 2010 study found that “soft drink taxes do not appear to have countered the rise in obesity prevalence because any reduction in soft drink consumption has been offset by the consumption of other calories.”[5]
Advocates claim that soda taxes have so far been ineffective because they are set too low. The authors of a 2013 study noted that “Current soda tax rates range from two percent to 7.25 percent and it’s possible these may not be high enough to affect BMI [Body Mass Index].”[6] However, a study published last year focused only on places which have the highest soda taxes and still failed to find an effect on body weight. Its authors concluded that “our results cast serious doubt on the assumptions that proponents of large soda taxes make on its likely impacts on population weight. Together with evidence of important substitution patterns in response to soda taxes that offset any caloric reductions in soda consumption, our results suggest that fundamental changes to policy proposals relying on large soda taxes to be a key component in reducing population weight are required.”[7]
It is of course possible that no state, town, or country has ever implemented a soda tax that is large enough to produce a measurable effect, but that there is some threshold at which taxation would become a meaningful weapon against obesity. Some models have suggested that soda taxes at rates of 20 per cent or more would result in some reduction in average body weight.[8] Evidence from Mexico, which has a high soda tax relative to national income, and Berkeley, which will shortly implement a one cent per ounce soda tax, may provide illumination on this point. To date, however, taxes on soda and candy have been set low enough to be effective as stealth taxes but ineffective as health measures.[9] Indeed, the evidence for using any economic instrument to control obesity is underwhelming.[10],[11] It is certainly possible that food and soft drink taxes could be raised to the point at which they actually ‘work’ (in the public health sense), but this would place a heavy economic burden on consumers and intensify the negative and politically unpopular consequences to which we now turn.
Efficient?
Like all policies, taxing food and soft drink has cost and benefits. Whilst the benefit remains forever on the horizon, the cost can be easily calculated; it is simply the amount of money squeezed from consumers by the tax. In New Zealand, for example, advocates claim that a 20 per cent tax on soda would save 67 lives per year and raise $40 million (NZ).[12] Leaving aside the reliability of the New Zealand forecast, this works out as a cost of $600,000 (NZ) for every life that is extended and does not represent good value for money.
Political action on public health grounds is often justified by the costs of unhealthy lifestyles to the healthcare system, and therefore to the taxpayer. The economic costs of obesity are often misrepresented and fail to account for savings to taxpayers, but even if they were more reliable it is far from obvious that additional taxes would relieve the economic burden.[13] For example, the UK’s Children’s Food Campaign recently claimed that a 20 per cent tax on sugary drinks would reduce healthcare costs in London by £39 million over twenty years, but their own figures suggest that the tax itself will relieve Londoners of £2.6 billion over the same period.[14] The cost of the tax will therefore exceed the savings by several orders of magnitude.
Advocates prefer to talk about soda taxes “raising” money rather than “taking” money. From their perspective, the money raised is simply another benefit of the policy. In fact it is a cost of the policy, and the tax is itself a negative externality. As Jayson Lusk noted in a recent blog post, soda tax campaigners can often expect to benefit financially from the money that is “raised.” Voters are more sympathetic to sin taxes if they are told that the revenue will go towards tackling sin, and advocates are keen for the money to go towards “prevention” and “education.” It is a happy coincidence that many of these advocates work in taxpayer-funded organizations which work on precisely these issues.[15] The Children’s Food Campaign, for example, wants the proceeds of its soda tax (some £1 billion a year) to go towards a “Children’s Future Fund.”[16] Such a fund would create new opportunities for bureaucratic expansion, employment, and mission creep.
There is some evidence to suggest that the public is waking up to the fact that taxes are rarely devoted to any specific purpose in practice and that on the occasions when sin tax revenue is genuinely earmarked, it transfers wealth from middle- and low-income consumers to bureaucrats and pressure groups. In 2012, Californian voters narrowly rejected a new tobacco tax, the proceeds of which were earmarked for “tobacco control research.” The pro-tax campaign, led by Stanton Glantz of UCSF’s Center for Tobacco Control Research and Education, was defeated by voters who disapproved of walling off money to politically unaccountable special interest groups at a time when the state was in dire economic straits.[17]
Fair?
It is well established that indirect taxes on essentials such as food and drink take a larger share of income from the poor than from the rich. One academic study from 2007 concluded that “fat taxes are unattractive because they are extremely regressive, and the elderly and poor suffer much greater welfare losses from the taxes than do younger and richer consumers.”[18] A further study from 2010 found that taxing food “generates substantial tax revenue, but is highly regressive.”[19]
Since it is difficult for advocates to claim that the poor do not take the hardest economic blow from sin taxes, they tend to make the dubious argument that the poor will enjoy the largest health benefits, or simply assert that sin taxes might not be fair but are justifiable on other grounds. Writing about tobacco taxes in 2002, McLachlan argued: “It is, in my view, not a fair tax but it is a good one… Taxes need not be fair in order to be justifiable… although it is unfair (or, at least, not fair) heavy taxation on tobacco is thought to be fair: it can be raised without a public outcry. Furthermore, the tax is easy and cheap to collect. The whole point of taxation is to raise money: taxation does this bounteously.”[20] It is true that sin taxes are easy to collect, difficult to avoid, and are a lucrative source of income, particularly when demand is inelastic. In the case of tobacco, they can also be popular, since most voters do not smoke. But when it comes to food and drink products that are purchased by the majority, it is a tougher political sell.
The regressive effects of Denmark’s short-lived tax on saturated fat sowed the seeds of its demise. The “fat tax” illustrated many of the problems already discussed.[21] It had a trivial effect on the consumption of the target ingredient, it led to a range of substitution effects, it hurt the poor, and it cost jobs. A few months before its abolition, an opinion poll found that 70 per cent of Danes considered the tax to be “bad” or “very bad.” Although initially supported by nearly all Danish political parties, Denmark’s politicians and opinion-formers turned against it when they saw that it was unnecessarily raising the cost of living, particularly for the poor.
Conclusion
Although the clamor for food and soft drink taxes gets louder every year, such policies have been rejected or repealed far more times than they have been adopted. Berkeley’s new one-cent per ounce soda tax will be the largest of its kind yet tried in the United States, but few see Berkeley as a typical American town, and even San Francisco rejected a similar policy. Compelling evidence from around the world shows that soda and fat taxes have delivered very little in terms of health but have created much in the way of unfortunate and unintended consequences. It is not necessary here to make the argument against such taxes on philosophical grounds. They fail even on their own terms.
Public health campaigners have only a few policies in their armory, and obesity activists rely on three economic levers to modify behavior, namely restricting advertising, reducing availability, and increasing prices through taxes. These policies have been borrowed from anti-smoking activists who, in turn, borrowed them from temperance crusaders. Many obesity activists openly emulate the tobacco control lobby, even going so far as to claim that “sugar is the new tobacco.”[22] But the comparison does not hold. The simple truth is that obesity is, has been, and always will be caused by an excess of calories from any source - frequently also to physical inactivity and various shades of gluttony. Vilifying a single ingredient has no scientific validity, and applying the anti-tobacco blueprint to sugar, soda, burgers or saturated fat is neither rational nor effective. It would be more logical to tax calories in general or to tax people directly according to their body mass index. Both policies would be politically unpopular and morally questionable, but so too would food and drink taxes if they were set at a level at which they could have a measurable impact on obesity.
Herein lies the problem with obesity-related taxes. If they are set low enough to be politically acceptable, they are merely stealth taxes which make no difference to health, but if they are set any higher, they become politically toxic. To date, no country has seen non-trivial health benefits from taxing food or soft drinks at any level. The results are uniformly negative. Theoretically, very high taxes could have some effect, but this is unknown and the unintended consequences of very high tax rates would be severe in terms of making the poor poorer, fuelling the black market, driving inflation, and creating discontent amongst voters.
Notes
[6] https://depts.washington.edu/esreview/wordpress/wp-content/uploads/2013/06/Fitts_Vader_SodaTax_PublishOnline.pdf
[12] http://www.nihi.auckland.ac.nz/page/news/front-page/20-tax-fizzy-drinks-could-save-lives-about-67-kiwis-each-year
[13] See my Adam Smith Institute report “The Wages of Sin Taxes” (2012) to see how these “costs” are exaggerated.
[14] http://www.iea.org.uk/in-the-media/press-release/tax-on-sugary-drinks-would-cost-londoners-%C2%A326-billion
[17] http://www.thedailybeast.com/articles/2012/06/06/california-s-proposition-29-is-yet-another-ballot-initiative-that-could-hamstring-the-state.html
[21] See my Institute of Economic Affairs’ report ‘The Proof of the Pudding: Denmark’s Fat Tax Fiasco’ (2013) for more details.
Response Essays
Does Public Policy Promote Obesity?
Can public policy stop obesity? In this month’s lead Cato Unbound essay, economist Christopher Snowdon looks at taxes on food and soda and concludes they cannot and do not. Such taxes, writes Snowdon, are neither efficient, nor fair, nor effective—necessary criteria to justify any such taxes. Snowdon traces the theoretical and practical implications of food and soda taxes and finds they are inefficient, unfair, and ineffective both on paper and in the real world.
Snowdon cites a wealth of scholarly research, including his own, to expose many of the flaws inherent in such taxes. He also cites a failed Danish experiment with a so-called “fat tax.” Notably, that tax—implemented by a conservative government in Denmark and repealed by a liberal successor government—is among the best real-world evidence that sin taxes on foods don’t work.
I agree with Snowdon in very large part. I have read many of the same studies he has, and have reached many of the same conclusions he has about those studies. Food sin taxes don’t work. They are unlikely to work in the future. As I will describe in this essay, I also believe that Snowdon’s underlying argument—that taxes should be efficient, fair, and effective—is a reasonable yardstick by which to measure other government policies that pertain to food and obesity. I also argue briefly that punitive food and soda taxes violate the spirit—if not the letter—of the Constitution.
Is Government Promoting Obesity?
What causes obesity? The basic assumption underlying public policies designed to counter obesity is that voters and—particularly—bureaucrats know the cause of obesity and can therefore design interventions that prevent or reverse it. But government policies themselves prove this faith is likely misplaced.
Activists in and out of government have been hard at work in recent years thinking up ways lawmakers and bureaucrats might halt obesity through punitive taxes, as Snowdon capably describes (and refutes). Often ignored in the debate over such taxes, though, are the many ways in which government policies likely promote obesity. This fact raises a necessary question. Rather than seeking to penalize consumers, taxpayers, and businesses, shouldn’t these activists look instead to eliminate government policies that might be responsible for promoting obesity?
The debate over soda is a perfect example of this phenomenon. Is it the scourge that critics claim? It sure seems that way. In 2012, for example, the Center for Science in the Public Interest, an anti-soda group, cited a key U.S. government report[1] to argue[2] that “[s]ugary drinks are the single-largest source of calories in the American diet[.]”
That sounds menacing. It’s also untrue. Sweetened drinks place fourth on the report’s list—behind grain-based desserts, bread, and chicken. That doesn’t make soda a health food. But it does raise the question: where are the policies designed to limit our intake of those other foods? They are nowhere to be found. Instead, government actively encourages Americans to consume them.
Take school lunches. Grain-based desserts, bread, and chicken—again, the top three foods Americans eat in terms of calories consumed, according to the USDA—are often found in the “healthier,” reformulated school lunches mandated by the very same agency. And by “often,” I mean almost always.
A look at the school lunch menu for K-8 students this month in New York City’s public schools, the nation’s largest school system, finds one, two, or even all three of these leading sources of calories on the menu every single day.[3] The lunch for January 12, 2015, for example, is Tuscan Crispy Chicken Sandwich with Creamy Garlic Sauce and Chocolate Grahams. For those keeping score, the lunch of chicken on bread and a grain-based dessert features all three of the top calorie sources. (While it’s true that pizza is the number two source of calories for kids—whereas the top three list takes the food choices of Americans of all ages into account—New York City’s public schools make sure to serve pizza for lunch every Friday.)
If activists wish to design public policies that reduce the number of calories we eat because that’s what’s making us obese, then policies that encourage us to eat more of those foods that already make up the bulk of the calories we already consume would seem to be (to put it politely) a boneheaded approach.
So soda taxes may not be fighting the real problem. But if sweetened drinks are indeed the menace that critics claim, then certainly the government would be crazy to promote the agricultural production of crops that are turned into sweeteners that find their way into soda. Right? Yet that’s the case right now, thanks to two multi-billion dollar policies. The Farm Bill is a massive entitlement program passed by Congress, on average, every five years. It subsidizes corn, which is grown to excess and is then turned into high fructose corn syrup, formerly little-used[4] but now ubiquitous thanks to the subsidies.[5] Sugar producers, meanwhile, benefit from a complex system of price supports and tariffs.[6]
Quite needlessly, taxpayers support the production of sweeteners. And, instead of pushing first and foremost to end the costly programs that subsidize and support them, many critics of sweetened foods and drinks would have government tax consumers for buying the very products that government policies—in the form of taxpayer funding—encourage farmers and others to produce.
There’s a simpler policy alternative. Instead of cheating taxpayers twice, policymakers should opt not to do so even once.
This brings us back to Snowdon’s guiding point—that food taxes intended to combat obesity should be efficient, fair, and effective. I believe, as I noted, that these same principles serve as a rational yardstick by which to measure other government policies that pertain to food and obesity.
What happens when we measure the USDA National School Lunch Program, farm subsidies for growing crops like corn that are turned into sweeteners, and price supports and tariffs to support the sugar industry?[7] None passes muster. They are inefficient. The subsidy/reward and subsequent tax/penalty cause consumers to be taxed at least twice—to enforce the policy, and then to combat its unintended consequences through sin taxes and through healthcare costs borne by taxpayers. They are unfair for the same reason and because the people who most consume the resulting foods are those in lower-income brackets—and who suffer most from obesity. Finally, they are ineffective. As Snowdon writes of soda taxes, their cost far outweighs their benefits “by several orders of magnitude.”
The Principled Argument
In his essay, Snowdon notes it is unnecessary “to make the argument against such taxes on philosophical grounds.” Indeed, he makes a convincing enough case on economic grounds.
But as an attorney with no economic training, I’d be remiss if I didn’t note my belief that punitive food and soda taxes violate the spirit—if not the letter—of the Constitution. A great deal of my own scholarly research focuses on this area. As I noted in comments to New York City’s health department in advance of that city’s ludicrous ban of subjectively large sodas in 2012,
the proposed ban very much harkens back to those acts of British economic aggression against the American colonies in the 1760s and 1770s—which, like the Sugar Act [of 1764], nearly always centered on unfairly taxing and restricting food choices—that led the Founding Fathers to fight the American Revolution.
The battle then pertained largely to the Sugar Act’s steep taxes on molasses, sugar, and rum. The British wanted to force the colonists only to buy British products—both to raise tax money and to punish its enemies in Europe (and their sugar-producing colonies in the Caribbean). The American colonists vigorously opposed the Sugar Act and similar laws—ultimately fighting to expel the British. The issues and actors may have changed, but unjust taxes pertaining to sugar are still at the heart of conflict in America more than 225 years later.
Conclusion
As Christopher Snowdon argues, punitive taxes on soda and food are an inefficient, unfair, and ineffective means of combating obesity. The push for such policies is often made without regard to the fact that existing, massive government policies—including the USDA National School Lunch Program and the Farm Bill—may themselves be causes of obesity. While taxes needlessly punish consumers and businesses, less expensive alternatives exist. These alternatives include putting an end to subsidies, tariffs, and price supports for sweeteners. Doing so would help combat obesity and would do so in a manner that is efficient, fair, and effective.
Taxes Can’t Do It Alone. But They Can Help.
That obesity is a major U.S. public health problem is not a subject of much dispute. With more than a third of adult Americans now counted as obese, the costs to this country both in terms of preventable adverse health outcomes (including heart disease, stroke, and diabetes, among many others) and actual dollars spent (which approached $150 billion in 2008) are substantial. Any measure that has a significant impact on this complex, seemingly intractable problem would be a boon to both our collective well-being and our pocketbooks.
In his essay “The Ineffectiveness of Food and Soft Drink Taxes,” Christopher Snowdon casts doubt on the role soda taxes should play as part of the effort to combat obesity. While he is right to question whether such taxes as a stand-alone method may have much impact on the problem, it is unrealistic to expect any one intervention to have a sizeable effect on a challenge as multifactorial as this. Soda taxes can play a meaningful role in the fight against obesity, particularly when the revenues are appropriately applied.
Snowdon correctly notes the basic physiology of obesity, which is caused when caloric intake is chronically in excess of expenditure. However, he seems to think that all calorie sources are roughly equivalent and easily swapped around. While it is technically true that excessively eating or drinking almost anything can lead to obesity, not all foods are equal in this regard. (One pauses to consider the truly heroic commitment to kale consumption necessary for its intake to be an obesity risk factor.) A standard bottle of soda contains hundreds of calories with nary a nutrient to keep them company, and sugared beverages produce very little satiety. While I agree that taxing calories as a whole would be problematic on many levels, and that the association between soda intake and obesity is not as strong as that between tobacco use (another product taxed for public health reasons) and lung cancer, the association between these entirely empty calories and obesity is certainly strong enough to make them a fitting target for taxation.
In downplaying the potential effect of soda taxes on obesity, Snowdon suggests that consumers will simply switch to an alternate form of liquid calories. Pepsi drinkers will just become drinkers of beer, milkshakes, or juice. But this argument is belied by actual experience. Consumers of soft drinks and the contexts of their consumption vary greatly from those of the proposed alternatives. It takes no more preparation to drink a soda than opening its container, unlike the significant effort necessary to whip up a milkshake, to say nothing of having the ingredients and equipment on hand. And I can drink a thousand calories’ worth of Mountain Dew at my desk over a workday without raising an eyebrow, which cannot be said of the same volume of beer; it is very rarely Miller Time in any given office.
Further, there remains a particular concern about soda intake in children and adolescents. Soda is a significant source of empty calorie consumption for both age groups, though sugar-sweetened juices and “sports beverages” also warrant scrutiny. Childhood and adolescent obesity is a significant predictor of obesity into adulthood, and interventions targeting these age groups may help prevent the long-term sequelae of being overweight later in life. Data on the specific effect of soda taxes on intake in young people are limited. However, there is some evidence that coupling soda taxes with removing from schools the vending machines that sell it, which otherwise has the surprising outcome of increasing students’ consumption overall, neutralizes this effect. And even one of the studies Snowdon cites demonstrating no reduction in obesity from soda taxes showed that said taxes disincent children and adolescents from drinking soda in favor of other, more nutritionally beneficial sources of calories, including whole milk. While perhaps unrealistic to expect soda taxes as a stand-alone policy to reduce obesity in younger populations, they may yet play a useful role in more comprehensive public health campaigns, particularly ones that also include other popular sugar-sweetened beverages, such as sports beverages, within their ambit.
Snowdon concedes that soda taxes may simply have been too low to effect much change in obesity rates, and another of his citations notes that most such taxes have been designed for the purpose of generating state revenue rather than curbing a public health epidemic. While Berkeley’s soon-to-be-enacted soda tax was approved with the latter goal in mind, even the data that follow from its one-city experiment should be viewed with some caution. Just as I can circumvent my state’s liquor taxes by purchasing my gin in nearby New Hampshire, motivated soda drinkers may simply pop over the border to Oakland. While the cent-per-ounce tax might be sufficiently onerous to lower consumption, a broader geographic scope might well enhance efficacy.
The issue of where the funds generated from such taxes would go is one that deserves due attention. But that is hardly an argument about the taxes per se, merely a call to be cautious about where the revenues go. Vague reference to bureaucrats and pressure groups as possible recipients elides the existence of programs that can have a meaningful long-term impact on the prevalence of American obesity. (Head Start, for example, looks promising in this regard.) The importance of distributing the cash wisely is not a reason not to raise it at all.
In questioning the efficiency of proposed soda taxes in the United Kingdom, Snowdon makes reference to some rather peculiar math. A group advocating for such a tax has averred that it would save Londoners £39 million over 20 years. Presumably this is because the UK’s largest, richest city subsidizes much of the country’s health care, similar to how tax money from affluent urban areasoften flows to rural ones in this country, and reducing the cost of treating obesity will flow back to them in tax savings. But Snowdon’s own Institute of Economic Affairs pins the cost to Londoners at a whopping £2.6 billion. They arrive at this figure by taking the projected cost of the tax to the UK of £1 billion per annum, multiplying by 20, and calculating that since Londoners make up 13% of the nation’s population, they will thus pay 13% of the price. But that assumes the citizens of the city comprise a homogenous mass of soda-drinkers, and that none of the roughly 17 million foreigners who visited last year (to say nothing of domestic travelers) ordered a Coca-cola during their stays. It may be that savings from a soda tax aren’t as clear-cut as advocates claim, but the discussion calls for a more sophisticated cost-benefit analysis than the one Snowdon provides.
Arguments that soda taxes unfairly target lower-income people are deserving of consideration. It is true that those in lower socioeconomic groups are more likely to consume soda, and would thus bear more of the brunt of a tax than wealthier citizens. Whether or not that makes soda taxes intrinsically unfair is a different question, however. Low-income soda drinkers are much more likely to be obese and also to be on publicly funded health insurance. Taxes on sweetened beverages are arguably a means of shifting costs, at least in part, onto those whose behavior generates them.
As I regularly admonish my patients when I advise them to cut down on sweets and fast food, the goal of programs aimed at reducing soda intake is not to drain the joy out of people’s lives. What is a birthday party without cake and ice cream, after all? Even Berkeley’s relatively painful one-cent-per-ounce tax shouldn’t make occasional indulgences out of reach. (It would add about two dollars to the price of three 2-liter bottles, for example.) Only with habitual consumption would a tax become cumulatively onerous, which is the exact same habitual factor that contributes to developing obesity. And at any point those being taxed can mitigate or obviate that burden, entirely at their own discretion.
No serious person can hold up a soda tax as the sole solution to the ongoing problem of American obesity. But Snowdon’s arguments are insufficient to dismiss it outright. Properly designed and implemented, soda taxes may play a role in preventing obesity and paying for the costs when prevention fails. They remain a worthwhile policy for consideration.
Public Policy Must Address Obesity, and Local Governments are Taking the Lead
Current rates of obesity and poor diet in the United States cannot be sustained. A recent report by the McKinsey Global Institute examined the economic costs of obesity and concluded that obesity rates have reached “crisis proportions.” Two-thirds of adults and one out of every three children under age 18 are overweight, triple the rate 40 years ago. The consequences are devastating. Diet-related diseases, including Type 2 diabetes and hypertension, once affected only adults but now are increasingly common in children. U.S. healthcare costs associated with obesity total $190 billion annually, $14 billion of that devoted to caring for children. Once a child becomes obese, he or she is likely to suffer from obesity for life. As a result, today’s children may be the first generation to live fewer years than their parents.
Officials in local communities experience the consequences of childhood obesity firsthand, and they have increasingly taken the lead to establish healthy communities that allow parents to raise healthy kids through policy initiatives. Such policies often include increased opportunities for children to engage in physical activity, as well as public health campaigns to inform parents and kids about the importance of healthy eating. Despite these efforts, increasingly it has become clear that the crisis of childhood obesity cannot be reversed without widespread systemic changes to the food environment that surrounds today’s children – an environment where high-calorie foods and beverages containing unhealthy amounts of sugar, saturated fat and salt are the cheapest, easiest, and most readily available and heavily marketed choices.
As a consequence, almost 40% of calories that young people consume consist of empty calories from solid fat and added sugars, and more than one-third of children’s calories come from snack foods (primarily desserts and chips) and sugary drinks. Sugary drinks (including sodas, fruit-flavored drinks, sports drinks, energy drinks and flavored waters) are the single largest source of calories and sugar in children’s diets. Every day, one-third of children and 40% of teens consume fast food, contributing an incremental 300 calories from sugar and saturated fat. In contrast, vegetables represent less than 5% of calories consumed by youth.
So what is the solution to this crisis of poor diet and obesity among children? I often hear that healthy eating is parents’ responsibility. Shouldn’t parents (and teachers) teach children the importance of healthy eating and exercise? Educate them about advertising and the tricks that advertisers use? Just say “no” when their kids pester them for unhealthy foods? Yes, of course. But parents can’t compete with the overwhelmingly unhealthy food environment surrounding their children as soon as they step outside the front door. Increasingly, parents have become aware of how difficult it is to raise healthy children in this environment and express widespread support for policies that would help them do so.
Comprehensive reviews of the literature on childhood obesity from the Institute of Medicine and the a White House task force also have concluded that key actors – including food and beverage companies, restaurants, retailers, trade associations, media, government, and others – must create an environment “that supports, rather than undermines, the efforts of parents and other caregivers to encourage healthy eating among children and prevent obesity.” Similarly, McKinsey concluded that “a combination of top-down corporate and government interventions with bottom-up community-led ones is required to change public-health outcomes.” All agree that parents cannot solve the childhood obesity crisis on their own.
While these experts recommend public policy solutions, they also call on the food industry to use its enormous creativity and resources to improve children’s diets. In response, the food industry has reversed its stance on industry’s role as compared to ten years ago. Through industry self-regulatory initiatives, such as the Healthy Weight Commitment, the Alliance for a Healthier Generation, and the Children’s Food and Beverage Advertising Initiative (CFBAI), trade groups and individual companies now promise to be part of the solution to childhood obesity – pledging to develop and promote healthier lower-calorie products.
Yet industry self-regulatory programs have produced only minor improvements in the unhealthy food environment that continues to surround children. Self-regulation of food marketing to children and teens – arguably the most harmful aspect of this food environment – provides a well-documented example. In response to growing pressure to reduce the enormous amount of unhealthy food marketing to children, the Council of Better Business Bureaus established the CFBAI in 2007. Today, most major food and beverage companies belong and pledge to promote only “healthier choices” in “child-directed media.” Similarly, members of the American Beverage Association promise to advertise only milk, water, and 100% juice to children under 12.
Almost eight years later, how has food marketing to children changed? Companies continue to spend almost $2 billion per year on food marketing that specifically targets children and teens, and 90% of those expenditures promote fast food, sugary drinks, salty and sweet snacks, and sugary cereals. In 2009, 86% of food ads that children viewed on TV promoted products with unhealthy levels of sugar, fat, and sodium, compared with 94% of ads in 2003. In 2013, despite declines in time spent watching TV, children under 12 viewed on average 13 TV food ads per day – 8% more than they viewed in 2007 – and teens viewed 16.5 ads per day, an increase of 25%.
Food and beverage companies have substantially reduced advertising on children’s television programming (e.g., Nickelodeon, Cartoon Network) and discontinued several major websites targeting children with games promoting food brands (i.e., advergames). But at the same time, they increased TV advertising aimed at 12- to 14-year-olds. Food and beverage companies also have been early adopters of youth-targeted marketing disguised as entertainment – such as product placements in TV, movies, and song lyrics, branded games on the internet and mobile apps, and concert and event sponsorships – as well as social media and other forms of viral marketing disguised as messages from friends.
Increasingly, policymakers have come to realize that government cannot cede responsibility for solving childhood obesity to the food industry. Companies’ primary obligation is to their shareholders. They must maintain market share against competitors – who may not be similarly disposed to act in the best interests of children’s health – and grow sales of their core businesses. Even the most well-intentioned company cannot risk disrupting a successful business model. As noted by one former food industry executive, “Change [by the food industry] will have to be forced — by public pressure, media attention, regulation and litigation.”
In the United States, government agencies, including the FDA, FTC, and USDA, have the authority to regulate various aspects of the food environment. However, even the weakest proposals for government intervention have met fierce industry resistance. For example, four government agencies proposed voluntary guidelines on responsible food marketing to youth in 2011. Despite overwhelming public support, extensive lobbying by the food industry effectively killed their publication. Similarly, 80% of parents support nutrition standards for foods sold in schools, such as those established by the Healthy Hunger Free Kids Act, but companies continue to lobby for watered-down standards. From 2009 to 2012, food and beverage groups spent an estimated $175 million in federal lobbying.
So that leaves policymakers in local municipalities and states. Fortunately for our children, many local officials have concluded that they cannot wait for the federal government or industry to take meaningful action to reduce unacceptable rates of childhood obesity. Establishing taxes on sugary drinks is just one potential tool in the local policy toolbox, but also a logical one. Sugary drinks are the largest single source of calories in children’s diets. They provide zero nutritional value. And they directly contribute to obesity and related diseases. Beverage companies spend almost $1 billion annually to advertise sugary drinks, much of it aimed at teenagers, as well as black and Latino communities. Economists have concluded that increasing the price of sugary drinks will reduce demand, especially among youth who have less disposable income and are the heaviest consumers. The over $100 million spent by the beverage industry to oppose local sugary drink taxes also suggests that companies believe that taxes would reduce sales. Evaluations of the recently enacted tax in Berkeley should provide additional proof.
Will sugary drink taxes – or any other single local policy action – solve the childhood obesity crisis? Of course not. As with tobacco, a combination of taxes, limits on sales and marketing to young people, increased understanding of the long-term negative consequences of poor diet in childhood, and changes in norms around consumption of unhealthy foods and beverages will all be required. But in the meantime, public policy must address the crisis of childhood obesity. Bravo for local policymakers who have stepped up to take the lead!
The Conversation
The Slippery Slope of Food Regulations
My thanks to Baylen Linnekin, Russell Saunders and Jennifer Harris for their thoughtful responses to my original article. As Linnekin largely agrees with me, this post will mainly address the arguments of Saunders and Harris.
Firstly, I should say that I do not hold some of the opinions that Harris and Saunders consider to be truisms. Saunders says ”that obesity is a major U.S. public health problem is not a subject of much dispute” while Harris says that “All agree that parents cannot solve the childhood obesity crisis on their own.” In fact, I do dispute that obesity is a “public health problem.” I don’t share the currently fashionable view that a public health problem is merely the aggregate of a nation’s private health problems. Obesity differs from genuine public health issues, such as unclean drinking water, pollution, and tuberculosis, in that it is not infectious and it can be prevented and cured without government intervention. It a private health problem – or, more correctly, it is a risk factor for private health problems.
I am loath to start a sentence with the words “as a parent,” but as a parent I reject Harris’s assertion that “parents can’t compete with the overwhelmingly unhealthy food environment surrounding their children as soon as they step outside the front door.” Parents can prevent their children becoming obese, particularly when they are young. Collectively, therefore, parents can “solve the childhood obesity crisis,” if it must be put in those terms. Similarly, parents can prevent themselves from becoming obese. The evidence is all around us. Even in the United States, with its supposedly “obesogenic” environment, two-thirds of adults and 83 percent of children are not obese. Obesity is not rare enough to be called deviant, but nor is it normal enough to be viewed as an unavoidable consequence of forces that are beyond the individual’s control.
In a free society, the question of whether government should introduce legislation to tackle obesity does not depend on obesity being a “pubic health problem” or even a “crisis.” Intervention can only be justified if obesity results from market failure or creates negative externalities for those who are not obese. Harris suggests that both criteria have been met. She uses what is essentially a market failure argument when she talks about the need for “widespread systemic changes to the food environment.” The implication is that consumers are denied real choice because so many products contain sugar, salt, and fat. This is the famous “obesogenic environment” in which healthy choices are supposedly difficult, if not impossible, and consumers are unable to satisfy their latent desire to eat cabbage and broccoli.
But look at the choices on the shelves, even in inner cities. There have never been so many low-fat, low-sugar, and low-calorie options in stores and supermarkets, never so many fruits and vegetables from around the world. You need look no further than the soda market to see the range of options available to the weight-conscious consumer. The Coca-Cola company launched its first low sugar brand (Tab) in the 1960s, and it now produces Diet Coke, Coke Zero, and Coke Life. Diet Coke and Coke Zero contain no sugar, and Coke Life is a low calorie version of Coke, made with a combination of sugar and sweeteners. Nearly all soft drink companies produce similar low-calorie, zero-calorie, and sugar-free varieties. All are widely advertised and all are available on the same shelves, in the same stores, and for the same price as their more sugary cousins. It is very difficult to argue that consumers are nudged, let alone coerced, into buying the high-calorie variants. If they buy them it is because they want them.
As for negative externalities, government could perhaps justify action if obesity was associated with costs to taxpayers. Harris mentions $190 billion of obesity-related health costs in the United States, some of which comes from the general taxpayer. These are not net costs however. Obesity, like smoking, is associated with savings to the taxpayer as a result of less government expenditure for welfare in old age, such as pensions. I am not aware of any relevant studies using American data, but research from the Netherlands found that the lifetime healthcare costs of obese people were significantly lower than those of healthy weight.[1] If we look at government expenditure in the round, it seems unlikely that the state would spend less money – or that it would be a “boon to our pocketbooks,” as Saunders puts it – if obesity was eradicated.
It is, then, far from obvious that obesity creates negative externalities deserving of government action. Since obesity is neither contagious nor the result of factors that are beyond the individual’s control, it is not a public health problem in the traditional – and, I would argue, meaningful – sense. It is merely a risk factor for private health problems, such as diabetes, which might result from it. Sugar fits into the picture only insofar as it is a source of calories, that is, insofar as it is food. In other words, it is a risk factor for a risk factor. Since there is a wide range of choice and little evidence of market failure, it is fair to assume that consumers’ revealed preference for high calorie food is their true preference. Any attempt to make their preferred choices more difficult will result in a welfare loss. Not everybody sees pristine health and maximum longevity as their goal. When I buy a Coke, I am aware that it provides “zero nutritional value,” as Harris puts it. I don’t buy it for the nutrients. I buy it because I like it.
But let us say that there was a market failure to be corrected and that obesity was a burden on taxpayers. Would soda taxes be a sound response? I say no. As I said in the initial post, the impact of sin taxes on food and drink in the real world has been trivial at best. The costs have inevitably exceeded the benefits (not least because there have been no benefits), and the burden on taxpayers has not shrunk, it has grown. Saunders acknowledges that every soda tax yet tried has been “too low to effect much change in obesity rates.” He also recognizes that local soda taxes lead to cross-border sales and therefore suggests that “a broader geographic scope might well enhance efficacy.” I assume from this that his solution is to have high soda taxes at the state or federal level. Fine. No one denies that such taxes could have an impact on consumption – and, perhaps, obesity – if they were high enough. The question is whether the negative consequences would outweigh the positive consequences. The shipwreck of the Danish fat tax should be our landmark here: Denmark’s tax witnessed cross-border sales, inflation, substitution effects, job losses, political unpopularity, and a disproportionate impact on the poor that ultimately led to repeal. Such negative consequences are likely to grow with the size of the tax. Ultimately, if taxes were raised to the eye-watering levels that would be required for them to have a measurable impact on health, consumers would be served by the black market, with all the negative consequences that it entails.
As for the positive consequences, do not underestimate substitution effects. This is not tobacco. Quitting is not an option. We have to eat and drink something, and for sound evolutionary reasons we are drawn towards food and drink that tastes nice (that is, food that has lots of calories). Saunders says: “Snowdon suggests that consumers will simply switch to an alternate form of liquid calories. Pepsi drinkers will just become drinkers of beer, milkshakes, or juice. But this argument is belied by actual experience.” Actually, that is precisely what Fletcher et al. found in their study which concluded that “reduction in soda consumption is completely offset by increases in consumption of other high-calorie drinks.” And, as the Danish experience showed, there is ample scope to maintain calorie consumption by shopping in cheaper stores and buying cheaper brands.
On the issue of cost-effectiveness, Saunders criticizes my cost-benefit analysis of what a soda tax would mean for Londoners. In fact, my methodology is no different from that of the Children’s Food Campaign (CFC), whose figures I analyze, and my estimate of the cost to Londoners (£2.6 billion) could be decimated, halved, or quartered and still be much larger than the claimed savings (£39 million). Perhaps I can make things clearer by using figures for the whole United Kingdom. It is said that obesity costs the British health service £5 billion (this doesn’t include savings; the net figure would be lower, possibly even negative). The CFC’s soda tax would, by their own estimate, cost £1 billion. A 20 per cent tax on sugary drinks would therefore have to reduce obesity-related healthcare costs by more than a fifth for it to reduce the overall tax burden. This is highly unlikely and the CFC’s estimates for London indicate that the savings would indeed be much lower than this. Russell’s comment that “savings from a soda tax” may not be “as clear-cut as advocates claim” is a huge understatement. The inelasticity of demand for sugary drinks means that savings are quite unattainable.
The best argument for soda taxes is, as Saunders notes, that they might shift more of the obesity-related tax burden from the slim to the obese. But taxes on sugary drinks are a very clumsy way of doing this; lots of obese people don’t drink them, and lots of slim people do. I would find this argument more convincing if soda tax campaigners outlined which taxes were going to be cut in order for the overall tax burden to fall.
Saunders is right to say that soda tax revenue need not inevitably be absorbed by general expenditure and new bureaucracies, but past experience creates a strong presumption. Denmark was exceptional in this respect by lowering its income tax by the same amount as the fat tax was expected to raise (and increasing its income tax when the fat tax was abandoned). It is difficult to imagine many governments being prepared to bring in unpopular taxes on food and drink unless they were going to bring in more revenue. Politicians would do better to follow Linnekin’s advice and stop subsidizing sugar and corn syrup – government interventions which really are a drain on the taxpayer.
For the sake of argument, let us say that a soda tax could shift the relevant healthcare costs efficiently to the obese on a “polluter pays” principle. Saunders acknowledges that this would place a greater financial burden on poor people – including, I might add, poor people who are not obese. I note that the study Saunders cites as evidence that “low-income soda drinkers are much more likely to be obese” found only a modest association between soda consumption and weight gain amongst women when other factors, such as watching television and physical inactivity, were controlled. Amongst men there was no association at all.[2] This should serve as a reminder that the evidence linking sugar and soda to weight gain is, as a 2007 review noted, “inconsistent.”[3] In my view, the evidence is nowhere near strong enough to justify making soda drinkers the scapegoat for the obesity “crisis” while letting couch potatoes off the hook (physical inactivity hovers over this whole issue like Banquo’s ghost; despite being at least half the problem, it cannot be taxed or banned and therefore does not get the attention it deserves from the public health lobby). Soda taxes would be discriminatory and unfair even if they did not take a disproportionate sum of money from the poor, but their invariably regressive nature makes them even more objectionable. Taxing food and drink is unlikely to make the poor slim, but it will certainly ensure they stay poor.
Saunders and Harris both acknowledge that a soda tax would have a limited effect “as a stand-alone method.” Harris proposes “a combination of taxes, limits on sales and marketing to young people, increased understanding of the long-term negative consequences of poor diet in childhood, and changes in norms around consumption of unhealthy foods and beverages will all be required.” This, as she explicitly states, is the application of the tobacco control model to diet.
I am almost – though not quite – tired of reminding people that anti-smoking campaigners spent decades denying that such a “slippery slope” exists. In 1994, RJ Reynolds was mocked for producing an advert which asked: “Today it’s cigarettes. Will high-fat foods be next?” They were only wrong about the ingredient that would come under fire, although given how rapidly the scientific consensus switched from fat to sugar, that is perhaps understandable. Reynolds asked the question because they knew that the American citizen of the 1990s would find the idea of waging war on “Big Food” to be self-evidently absurd. Since that assumption can no longer be taken for granted, we need to ask whether tobacco-style regulation is an appropriate and effective approach to diet.
Again, I say no. Food is not tobacco. Obesity is not lung cancer. And, contrary to some hyperbolic claims made in recent years, sugar is not addictive.[4] As discussed above, taxes are not as effective when there are a range of substitute products available. As for advertising bans, which Harris dwells on, the economic evidence is very clear that advertising can stimulate demand for a particular brand but has little or no effect on demand for established product categories, such as soda or hamburgers, as a whole.[5] I appreciate that this goes against some deeply held beliefs about the supposedly coercive nature of advertising, and I know that there are public health academics who insist that primary demand is driven by marketing, but I find the evidence of economists who have looked at numerous different products in dozens of different countries to be more compelling.
If there is a lesson to be learned from tobacco control, it is that it never ends. Harris and Saunders make it clear that soda taxes are just the start. What, then, is the endgame? How much obesity would they tolerate? How much tax would be too much? If we are talking about a whole suite of policies, the public has a right to know what they are signing up to before taking the first step. It is no coincidence that the anti-smoking movement began with sin taxes and advertising bans. Does the anti-obesity lobby also favor the more aggressive policies that have turned the anti-smoking crusade into a war of attrition? Can we expect soda drinkers, like smokers, to be treated like second -class citizens? Can we expect the demonization of the soda industry, which has already begun in California? Lawsuits? Point of sale bans? Mandatory product reformulation? Bans on certain flavors? Bans on drinking Coke in public places?
These are not frivolous questions. I maintain that every food and drink tax yet tried has been ineffective. Harris and Saunders argue that higher taxes would work better – in extremis they might be right – but say that they would still have a limited effect unless combined with a range of measures lifted from the tobacco control playbook. Soda taxes cannot, therefore, be judged in isolation. Unless we are told what will accompany them, we are being sold a pig in a poke.
What Causes Obesity?
What causes people to be obese? While I agree with much of what Christopher Snowdon wrote in his lead essay and response piece, it’s noteworthy that he repeats the popular cliché that all calories are created equal—also known as the “calories in/calories out” theory of obesity. In his lead essay, Snowdon writes that “obesity is the result of consuming more calories than an individual burns off.”
That theory may very well prove true. But it also may not.
On this issue, I am inclined to agree more closely with the opinions of fellow essayist Russell Saunders, who suggests that the problem may be more complex than the calories-in-calories out formula suggests.
Interestingly, many progressives and libertarians alike argue that this theory is false. The so-called “paleo” movement, which counts many libertarian adherents, posits that a carbohydrate-rich diet is the leading cause of obesity. Libertarian paleo practitioners don’t tie their belief in the inherent evil of carbohydrates—a family that includes sugar, and, hence, soda—to any call for increased regulations to limit their consumption. But progressives like Dr. Robert Lustig are particularly opposed to sugar consumption—labeling it a “poison”—and they use that hostility as a jumping-off point to call for a host of severe regulations to curtail sugar consumption.
While I find myself more inclined to agree with Saunders in questioning the calories-in/calories-out theory as overly simplistic, I disagree with the crux of his reasoning on any potentially positive impact soda taxes might have on consumers. Saunders attempts to debunk Snowdon’s argument that higher soda taxes will drive consumers to purchase other caloric beverages or to make them at home. Saunders engages in a bit of hair splitting to make his point, arguing, for example, that people are unlikely to make high-calorie milkshakes at home because doing so is too time-consuming. He describes “the significant effort necessary to whip up a milkshake, to say nothing of having the ingredients and equipment on hand.” I would love to introduce Saunders, a physician who “specializ[es] in medically complex patients”—now that sounds truly difficult—to the $25 Cuisinart hand blender I use to make protein shakes every day, in 20 seconds or less.
Even if homemade milkshakes won’t bring all the boys to the yard as readily as soda might, that point doesn’t do a whole lot to negate Snowdon’s solid point that soda taxes will encourage people to switch from soda to other caloric beverages.
Saunders is also critical of Snowdon’s argument that soda taxes will encourage people to switch from soda to beer. Interestingly, Saunders bases his argument on nothing more than his own personal observations and experience, saying that he can drink as much Mountain Dew as he’d like at work but would run into problems if he tried to turn his office into a scene out of Mad Men or Boardwalk Empire, in which alcohol is the workplace’s constant lubricant. Sure, that’s true. But while research may not show that soda taxes increase alcohol consumption at work, it does show that that soda taxes increase overall alcohol consumption. One study, for example, found that a ten percent tax (similar to tax passed by Berkeley voters) “led to increased purchases of beer.” Given that alcohol is nipping at the heels of soda already in terms of overall consumption rates, there’s reason to believe that soda taxes in a large state or a few large cities might help tip the scales in alcohol’s favor.
In making his arguments about milkshakes and beer, Saunders also ignores Snowdon’s claims that consumers might switch from soda to juice. As I’ve noted before, soda contains the same number of calories, more or less, as a glass of orange juice. But if milkshakes, beer, and juice aren’t the answer for the consumer, then soda taxes may succeed in pushing consumers to switch from soda to… soda. Already, in fact, many well-heeled consumers use gadgets like Sodastream to craft their own soda at home.
In short, it’s impossible to discount the fact that soda taxes will simply push consumers to replace calories consumed in the form of store-bought soda with any number of other caloric offerings. There is no shortage of high-calorie alternatives to soda available today.
So just what is it that makes soda a policy concern? Jennifer Harris’s policy arguments hinge on her claims about the uniquely pervasive impact of sugary drinks like soda on the health of America’s youth. The data she refers to are indeed shocking. “Sugary drinks (including sodas, fruit-flavored drinks, sports drinks, energy drinks and flavored waters) are the single largest source of calories and sugar in children’s diets,” writes Harris.
But that’s simply not true. While Harris doesn’t refer to any source to support her claim, widely cited U.S. government data paint a different picture. In fact, the main source of calories in children’s diets is “grain-based desserts.” The second-largest source is pizza. Sodas and other sweetened beverages are third on the list. (For adults, soda falls fourth on the list.) By no measure are these drinks “the single largest source of calories” consumed by children.
I’ve seen this claim before. For supporters of soda taxes, I suspect making such bold claims—that soda contributes more calories than any other source, particularly as part of children’s diets—are necessary to bolster arguments in favor of taxes. For example, in 2012, I refuted claims by the Center for Science in the Public Interest that “[s]ugary drinks are the single-largest source of calories in the American diet.” The same government data I cited above prove that claim to be false.
Arguments in favor of soda taxes require that soda be the bogeyman. But what’s hiding under the bed are some key facts that show otherwise. If the purpose of soda taxes is to make people any healthier, these taxes will fail. Notably, if the purpose of soda taxes is to compel people to drink less soda and to punish soda companies and consumers without creating any measurable health benefits, then soda taxes are the answer.
Some Replies on Public Health and Obesity
In reading Christopher Snowdon’s follow-up essay about the efficacy and fairness of soda taxes in combatting obesity, I was faced with a conundrum. How to frame the state of affairs in such a way as to be mutually acceptable? Or can we even agree that there is a problem to be addressed?
In countering my own defense of soda taxes as a means of tackling the epidemic of obesity in the United States, Snowdon starts with one of my premises.
“I do dispute that obesity is a ‘public health problem,’” he writes, disagreeing with the way I described the number of Americans who are obese or overweight. Rather, it is by his lights a private health problem that affects a great many Americans. Since it is a result of individual choices, with non-transmissible consequences, then there’s really not much that should be undertaken as a public response.
On this point, I fear there’s little to be gained by arguing. He says that thinking about such problems in terms of public health is a regrettable vogue, and I say it’s an appropriate area for policy intervention, and I doubt we will convince each other. The limits of what our government ought to be doing are a subject too broad for the ambit of a conversation about soda taxes.
He also disputes that there are real costs to the public caused by obesity, because if we simply let obese people die of the sequelae of their obesity we’ll save money in the long run. (He doesn’t use that exact phraseology, but it’s certainly the crux of his argument.) Again, from a starkly mathematical point of view, I suppose he has a point. But since medical providers such as myself are in the business of keeping people alive and well as long as possible, I fear this is another area where there’s going to remain a lot of daylight in between us. Assuming that keeping people alive and in reasonable health as long as we can is something to shoot for, it would be cheaper to do so if they were less obese.
I am not as convinced as Snowdon that the Danish fat tax, which seems to have been an unmitigated failure, is a sound basis for predicting the efficacy of a more limited soda tax. The Danes applied their taxes to a wide range of what could well be considered staple foods, rather than a product (like soda) that absolutely nobody needs. Given that the role of saturated fats in developing disease and obesity is a subject of some controversy even within the medical community, the tax in Denmark seems ill-begotten on many levels. But their failure related to taxing one foodstuff does not convince me that taxing an entirely different one will meet a similar fate.
I happily concede Snowdon’s point that a soda tax will do nothing to combat the problem of sedentary behavior among the obese. Obesity is a multifactorial problem, and will require a multifactorial set of solutions, if one accepts that finding solutions should be the business of policymakers. Were Snowdon to offer alternative suggestions that addressed that factor in the country’s obesity problem, I’d gladly consider them.
Snowdon further references a slippery slope along which food regulations would slide if soda taxes were enacted. In support of this, he mentions a tobacco ad that raised the question “Today it’s cigarettes. Will high-fat foods be next?” — in 1994. Given that more than two decades have passed since those cigarette regulations were the topic at hand and now one small, solitary American city is raising taxes on soda as a means of combatting obesity, it’s a bit of a stretch to see much of a slope at all, much less a slippery one.
Further, it seems odd to complain that soda taxes won’t be effective on one hand, but then to stoke fear that they will be the start of a slippery slope on the other. Which is it? The two arguments do not cohere.
Is there potential for soda drinkers to switch to other high-calorie drinks as a substitute? Yes. I would argue that a tax on other sweetened drinks like “sports drinks” and products like Vitamin Water, which is essentially a gussied-up soda without the fizz, would mitigate this effect. I am still skeptical about beer or milkshakes as plausible soda alternatives, and even if people switch to whole milk as a possible option, it’s a much healthier one than soft drinks.
Will customers switch to cheaper soda to make up for the change in price point for the name brands? Possibly. But at least revenue will be generated that could be directed at programs to combat obesity in other areas. (I will once again suggest Head Start as a worthy candidate.)
Soda taxes have potential to be only one part of a public policy effort to combat obesity, a policy Snowdon suggests isn’t worth our time and effort in the first place. I disagree, and am curious to see what happens in Berkeley and (perhaps) beyond as this policy is given serious consideration.
Welcome to the Obesogenic Environment
In his most recent post, Snowdon makes a far-reaching case to support the “slippery slope of food regulations,” arguing his “opinions” to counter the “truisms” that Saunders and I present.
However, closer examination of his opinions shows them to be just that – opinions. He supports this broad array of opinions with a scant six references, including references that do not support his opinions at all. For example, as support for the claim, “Contrary to some hyperbolic claims made in recent years, sugar is not addictive,” he presents an article from a neuroscience journal that argues, “The currently available evidence for a substance-based food addiction is poor, partly because systematic clinical and translational studies are still at an early stage. We do however view both animal and existing human data as consistent with the existence of addictive eating behavior.” In other words, the research on the addictive properties of individual nutrients (primarily sugar) is still in its early stages so scientists cannot yet conclude that sugar itself is addictive, but they can conclude that eating behaviors (e.g., consuming sugar-sweetened sodas) can become addictive.
But I will stick to my area of expertise – food marketing and the “so-called” obesogenic environment.
First, an accurate definition of the obesogenic food environment. Snowdon describes it as an environment where “consumers are unable to satisfy their latent desire to eat cabbage and broccoli.” In fact, humans are biologically programmed to desire sweet-tasting and high-fat foods – and to overconsume them so they can be stored as fat for use in lean times. Children can be taught to like the taste of cabbage and broccoli, but it takes numerous exposures. It also takes time and money, as fresh vegetables cost more and take more time to prepare than fast food and packaged processed foods. In the obesogenic food environment, high-calorie nutrient-poor foods (also the foods that humans innately prefer) are cheaper, faster and easy to overconsume.
Snowdon claims that store shelves “even in inner cities” are full of “fruits and vegetables from around the world.” Really? The USDA estimates that 23.5 million Americans live in food deserts, defined as “urban neighborhoods and rural towns without ready access to fresh, healthy, and affordable food. Instead of supermarkets and grocery stores, these communities may have no food access or are served only by fast food restaurants and convenience stores that offer few healthy, affordable food options.” I live in one of those food deserts. The closest supermarket is 2.7 miles away and on a different bus line. If I didn’t have a car, it would take me more than one hour each way to reach those “fruit and vegetables from around the world.”
My research team has spent a lot of time examining food marketing in the United States and documenting how it contributes to the obesogenic environment. We recently published a report on beverage marketing that paints a starkly different picture from the one presented by Snowdon.
According to Snowdon, “Nearly all soft drink companies produce similar low-calorie, zero-calorie and sugar-free varieties.” That is true, but at the same time beverage companies have introduced low- and zero-calorie beverages like Coke Life, they have also introduced similar numbers of sugary beverages. Take Mountain Dew Kickstart, for example. This product contains less sugar (60 calories per can) but more caffeine than a typical soda and 10% juice. The product is marketed to teens as a great way to “kickstart” their day. Soda for breakfast? Hardly a win for public health. In fact, from 2010 to 2013, median calories and sugar in sodas did not change.
Snowdon also claims that, “All [low-calorie and sugar-free options] are widely advertised and all are available on the same shelves, in the same stores, and for the same price as their more sugary cousins.” In fact, according to Nielsen – the same data used by companies to measure their own advertising campaigns and those of their competitors – in 2013 beverage companies spent almost $900 million to advertise sugary drinks, primarily sugar-sweetened sodas, energy drinks, sports drinks, and fruit drinks; $200 million to advertise diet (i.e., zero-calorie) sodas and other beverages; $140 million to advertise 100% juice; and approximately $50 million to advertise plain (unsweetened) water.
In other words, beverage brands invested 65% of their over $1 billion advertising budgets to promote sugar-sweetened beverages. In contrast, just 14% of their advertising encouraged consumption of water or 100% juice – the only products in their portfolios that provide any nutrients humans require to live. Contrary to Snowdon’s assertion, quitting sugar-sweetened beverages is an option. And as with tobacco, one that will greatly improve their health.
Of course, according to Snowdon, this advertising has no impact on consumers’ preferences for sugary drinks over other options – as his selection of two online references written by economists support. However, my own research – conducted with two economists and published in a peer-reviewed economics journal – documents the opposite. Exposure to advertising for carbonated soft drink advertising, including both sugar-sweetened and diet sodas, is a strong and significant predictor of sugary soda consumption in fifth graders.
But even if Snowdon dismisses this research as evidence of my “deeply held beliefs” about the effectiveness of advertising, his argument makes no sense. Bottled soft drinks did not exist until the early 20th century – fruit drinks, sports drinks, and energy drinks are even more recent inventions. Yet in 2013, U.S. households spent over $14 billion to purchase these sugary drinks. And whereas our ancestors survived drinking only water, milk, and the occasional alcoholic beverage, consumers today believe that drinking sugary drinks is “fun,” promotes “happiness,” is a necessity for athletes, and is “energizing” to boot. If not driven by marketing, how did these behaviors and beliefs develop? Surely beverage companies also must believe that advertising works or they wouldn’t invest over $1 billion per year on it.
In this fictional market that Snowdon describes, the only barrier to consumers’ purchase of healthy options is their desire for the unhealthy stuff. But again our research on sugary drink marketing presents another barrier. Marketing often misleads consumers into believing that drinks consisting of water, calories from sugar alone, and miscellaneous additives are healthy options.
For example, Sunny D, a children’s fruit drink, contains 14 grams of sugar (3.5 teaspoons totaling 60 calories) per 8-ounce serving, plus artificial sweeteners to make it even sweeter, and high amounts of sodium. Although the product consists of just 5% fruit juice - with no orange juice - artificial colors make it look like orange juice. It comes in a clear bottle that is often stocked in the refrigerator case of the supermarket near the orange juice, although the product does not need to be refrigerated. Its label even includes pictures of oranges and the claim 100% vitamin C. These marketing techniques have been very effective. Although one serving of Sunny D contains the maximum amount of sugar that nutritionists recommend children consume in an entire day, 56% of parents believe that this is a healthy drink to serve their child.
Especially egregious are marketing practices that target children and adolescents in companies’ drive to “capture the stomach” of young consumers. Companies know that brand preferences, taste preferences, and eating behaviors develop at an early age and are extremely difficult to change once established. A Coca-Cola marketing executive supports the company’s teen-targeted marketing practices, “We can’t afford not to talk to teens. You can’t think, ‘Teens already know us and skip a couple of years.’ Every six years there’s a new population of teens in the world.” According to PepsiCo’s website, they offer “good-for-you” beverages (including water and orange juice) and “fun-for -you” beverages (including sugar-sweetened soda). Which ones do you think they market to teens? Of note, over 90% of food marketing that targets children in their own schools promotes sugary drinks. And this marketing is much more prevalent in low-income schools.
I could go on, but I will finish with this observation. Snowdon believes that a rate of 17% of children who suffer from obesity is acceptable – that is almost one out of every five children in the United States. I don’t agree, and perhaps that is the main reason for my beliefs. In my opinion, it is unconscionable to doom any child to a lifetime of serious health challenges such as type 2 diabetes, hypertension, and stigma simply because they were born in an environment designed to make it so easy and cheap to overconsume great-tasting but nutritionally poor foods. You can blame the parents who don’t have the means, the time, or the knowledge to overcome this environment surrounding their children. Or you can try to improve the environment – including through public health policy – so that parents don’t have to do it on their own.