Mixed Results in the Holy War Against Sweet Drinks

Mixed Results in the Holy War Against Sweet Drinks

Two new papers give us a mixed picture of results from the holy war to drive sweet drinks from the American diet. On the front lines in Oakland, California, economists tell us that a beverage tax has had negligible effects. But the good news is that perhaps that doesn’t matter. Researchers have discovered that sweetened beverages were already in decline across the U.S. well before that tax went into effect.

So does this mean we’re winning?

Taxes Usually Work to Reduce Purchases

As a basic principle, it’s safe to say that purchases of a product decline when the price goes up. Taxing sweet drinks should drive their prices up and thus purchases down. But the real world is messy. Sometimes, merchants and consumers find work arounds. A new paper in the May issue of Economics and Human Biology suggests that this might be happening in Oakland.

Voters in Oakland approved a one cent per ounce tax on sugar sweetened beverages (SSBs) in 2016. It took effect in July of 2017. John Cawley did a thorough analysis of data on the effects of that tax for this paper. They found a slight decrease in purchases at stores in Oakland and an offsetting increase in stores outside of the city. Clever shoppers. Cawley et al conclude:

We do not find evidence of substantial changes in the overall consumption of SSBs or of added sugars consumed through beverages for either adults or children after the tax.

Another new paper on the Oakland tax, in Preventive Medicine Reports, also points to mixed results. The authors find that even within the city, merchants didn’t pass along all of the tax impact. On bottled soda, they passed on most of it – 82 percent. But on fountain drinks, the price to consumers did not increase significantly after the tax.

If the goal of the tax is to generate revenue, it’s working. It brought $18 million to the city for its 2019-20 budget year. But if the goal is to change consumer behavior, it missed the mark.

SSBs Already Trending Down

The other observation comes from researchers at UNC Chapel Hill in the American Journal of Preventive Medicine. Pourya Valizadeh, Barry Popkin, and Shu Wen Ng studied trends in purchases of sugar-sweetened beverages between 2002 and 2014 across the U.S. They found “meaningful reductions.”

Those numbers are a bit old, but other days tell us that the trend has been ongoing now for two decades. In fact, U.S. consumption of sweeteners has declined to levels not seen since the 1980s. Meanwhile, obesity continues to rise.

To Valizadeh et al, this means we need more taxes on these bad beverages:

Overall, though results from this study indicate that there are declining trends in SSB purchases at all purchase levels, they highlight the need for public health efforts and interventions (e.g., SSB taxation) to further reduce SSB purchases, particularly among high consumers.

Stuck on a Righteous Cause?

The commitment to fighting a holy war against sweet drinks is impressive. But we can’t help but wonder which enemy is the target of all this passion. Is it the beverage industry we must defeat? Or is it the chronic disease of obesity?

If the fight is for health, at some point it might be necessary to let up on the public health obsession with the white whale of sweet drinks and look to other targets for our wrath. Defeating soda pop doesn’t seem to have us winning the war for better metabolic health. Maybe the problem is more than just a “sugar epidemic.”

Click here for the Cawley paper and here for the Valizadeh paper.

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May 13, 2020