Do Soda Taxes Hurt Low-Income People? Hillary and Bernie Spar Over the Issue

The moments when Vermont Sen. Bernie Sanders toes the line of corporate America are few and far between, which made a Thursday statement that echoed the rhetoric of a nearly $100 billion industry all the more notable. The candidate for the Democratic presidential nomination responded to opponent Hillary Clinton’s support for a proposed soda tax in Philadelphia by calling the proposal a “regressive” measure that would disproportionately affect low-income residents.

“At a time of massive income and wealth inequality, it should be the people on top who see an increase in their taxes, not low-income and working people,” Sanders said in a statement. Sanders accused Clinton of filching on her promise not to raise taxes on anyone making less than $250,000, noting the tax on soda and juice would “disproportionately increase taxes on low-income families in Philadelphia.”

It is true that soda consumption is disproportionately high in low-income, minority communities—and so are diabetes and other diet-related illnesses, which has inspired politicians to debate ways to slow the consumption of sugary beverages.

Broken down by race, in a 2013 Gallup poll, 46 percent of nonwhites said they drink regular soda, compared with 27 percent of white respondents. In terms of income, 45 percent of Americans who earn less than $30,000 annually drink regular soda, according to Gallup, compared with just 20 percent for those who earn more than $75,000 annually. 

What’s also true is that Sanders is adopting the soda industry’s primary line of attack against soda taxes, which in many cases are designed to promote public health in poor, minority communities disproportionately affected by obesity and diet-related disease.

Here’s a 2015 blog post from the American Beverage Association, the leading industry trade group, called “The Real Impact of Soda Taxes”: “Economists generally agree that taxes on foods and beverages are unfair as well. Because of the regressive nature of these taxes, they negatively impact low-income populations more than they do the overall population.”

Sanders’ critique of soda taxes—echoed almost verbatim by a $9.1 million industry-backed campaign—proved successful for the American Beverage Association in San Francisco, where it defeated Proposition E in 2014. Unlike the Berkeley, California, soda tax that voters approved that fall, the San Francisco measure would have flagged revenue for public health programs, and it thereby required a two-thirds majority to pass. In the end, it garnered 55 percent of the vote, and according to analysis from Corey Cook, a political science professor at the University of San Francisco, the city’s low-income, diverse neighborhoods voted against it.

But is a penny (or three) saved a penny earned? The economic costs of obesity were estimated to be $147 billion in 2008, according to the Centers for Disease Control and Prevention. With obesity and other diet-related diseases, such as type 2 diabetes, disproportionately affecting poor, minority communities—48 percent of African Americans are obese, for example, compared with a third of white Americans—the problems the taxes hope to combat weigh the most heavily on communities that would be most burdened by soda taxes.

“I understand the idea that this is a regressive tax,” said Laura Schmidt, a health policy professor at the University of California, San Francisco, “and I think the thing we all have to remember is that diabetes is a regressive disease—it doesn’t just affect everybody evenly. It disproportionately affects low-income communities and communities of color.”

With Oakland, California, set to vote on a soda tax in November, and lawmakers in Boulder, Colorado, announcing on Friday that a similar measure will be on the municipal ballot this fall, the idea—if not yet the law—is clearly catching. In Philadelphia, Mayor Jim Kenney is going in a new direction with his soda tax proposal: Instead of a ballot measure aimed at reducing consumption, his proposal is part of the city budget and geared at generating revenue, pure and simple. Overseas, the United Kingdom will soon tax soda and sugary beverages as well. On Twitter on Friday, Mark Bittman wrote, “I think 20 cities will have soda taxes within 5 years. Berkeley is not an anomaly but a pace-setter.” The former New York Times columnist (who lives in Berkeley, it bears mentioning) also tweeted that a “regressive tax on poison is a good thing.”

Just as obesity and diabetes are regressive, as Schmidt said, she believes the market is similarly uneven. “You’re looking at producers and distributors that are targeting low-income communities of color, and children in particular, with very targeted marketing campaigns with one known addictive substance in them, caffeine, and sugar, which is habit-forming,” she said. “You really have to start looking at the question of when do they start paying for part of the public health toll.”

“If these were diseases that affect all populations equally, and the vector of the epidemic—the industry—were fair in its targeting of the whole population, it would be different,” Schmidt said. “But that’s just not how it works.”

This article originally appeared on Reprinted with permission.

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