Marc Bellemare, PhD, associate professor of applied economics at the University of Minnesota in St. Paul, said, “I don’t see any evidence they would work in the United States.”
He said that sugar-sweetened beverages are such a small part of Americans’ budgets that a tax would not make a difference, in contrast to Mexico, where food makes up a much larger portion. Taxes that would be politically feasible will not be large enough to significantly cut consumption, he reasoned.
“Food is about 7% to 10% of the average Americans’ household budget, and [sugar-sweetened beverages are] an even smaller portion of it. I think people would just take the hit,” Dr Bellemare told Medscape Medical News.
He also described an emotional American response to being told by policymakers how to make consumption decisions that would work against such a tax.
“It seems that even small-fraction taxes are politically contentious, as the whole New York City debate has shown.”
That said, Dr Bellemare said, there is a good reason for the tax other than making people healthier: “A tax like this is bound to bring in money to the coffers of any city or state that decides to levy a tax like this. But I don’t think it’s very popular with people, and that’s a trade-off.”
He said the better option is to target not just sugar-sweetened beverages.
“In my mind there is no doubt that sugar is certainly causing a whole lot of health problems,” he said. “But if we’re going to go that route, what we should probably think about doing is targeting sugar, in general so not just soda but all products that have sugar in them, or tax sugar at the source.”
This is from a recent article in Medscape Medical News for which I was asked to comment on Mexico’s tax on sugar-sweetened beverages, and whether I thought it would be possible to implement a similar tax in the US.
The article generated a good amount of discussion on Facebook. Among other things, my colleague Cullen Hendrix jokingly referred to my argument that because sugar-sweetened beverages represent such a small fraction of the typical American households’ budget, consumers wouldn’t change their behavior as “Dr. Pepper’s corollary to Engel’s Law.”
At any rate, it is nice to be quoted in an article where the other two academics quoted are Barry Popkin, a fellow Cornell applied econ PhD alum who is currently distinguished professor of nutrition at UNC, and Kelly Brownell, an expert on obesity who is currently dean of the Sanford School of Public Policy at Duke.
(Also, those who have evaluated Mexico’s soda tax find that it works best… for the lowest socio-economic groups. In other words, past a certain income level, people just don’t seem to care about paying such a tax. If this isn’t Engel’s Law in action, I don’t know what is.)
Again: I am convinced that sugar is at the root of many if not most public health problems (or, at the very least, at the root of many more such problems than fat ever was), but this country’s policy makers have a schizophrenic attitude to sugar. On the one hand, it is cheap to make foods high in high-fructose corn syrup given the corn subsidies; on the other hand, we want to tax sugar-sweetened beverages. Cherchez l’erreur…
Related to all this, my former student Maeve Gearing, over at the Urban Institute, and her coauthors released a report yesterday that looks at taxes on unhealthful foods and drinks; you can find the report here. I have not had time to read the report, but it looks as though the overarching conclusion is that such taxes are not the silver bullet some people would make them out to be, and whether they work is highly context-dependent. In other words, they seem to make a more general version of the argument I make above.
As for Mexico, here is a bit of speculation, informed by my work in agricultural development: My hunch is that an increasingly sedentary workforce combined with a national diet that is very high in carbohydrates (i.e., lots of corn and beans) is at the root of the problem, much more so than soda. This would mean that economic development, by way of Bennett’s Law (the empirical regularity whereby, as people become wealthier, they move away from a diet heavy in cereals toward a diet that consists increasingly of protein and fat), would make Mexicans healthier than a soda tax.