Coke CEO attacks soda tax as a Commie tactic

A careful observer of the history of taxation might remind Coca-Cola Co. (KO) chairman and CEO Muhtar Kent that taxes have been used for centuries to create incentives for desired behavior. At a Rotary Club meeting in Atlanta on Monday, Kent employed the alarmist rhetoric reminiscent of Whole Foods CEO John Mackey and professional rabblerouser Sarah Palin, calling President Obama's suggestion of a federal tax on soft drinks "outrageous," saying, "I have never seen it work where a government tells people what to eat and what to drink. If it worked, the Soviet Union would still be around."

But it does work, and the United States is still around. Tariffs (which create incentives to buy U.S.-made goods), "sin taxes" on cigarettes and alcohol, bottle deposits to encourage recycling -- the U.S. is no stranger to this incentive system. We have tax incentives to make charitable donations and to buy a home. It's a rare pundit who would insist that consuming sugary sodas is a good thing for any entity other than a soda company and its shareholders (and perhaps pharmaceutical companies that sell drugs and devices to treat diabetes, heart disease, and other obesity-related conditions.)
The most common argument against soda taxes is the "slippery slope" -- first soda, then sugary snacks, and then they'll come for our Tostitos! -- as espoused by Americans Against Food Taxes (a group funded, of course, by Coke, Pepsi-Cola (PEP), Jack in the Box, and other likeminded food companies). "Families around here are counting pennies to get through this economy," says a sad mom in a TV spot. "So when we hear about another tax, it gets our attention. They say it's only pennies. Well, those pennies add up when you're trying to feed a family."

Naturally, it's left out that any mother seeking to feed her family could probably do so even better were she to leave the "fruit drinks" and sodas out of her shopping cart. No nutritional expert, chef, cafeteria worker, or moderately intelligent second grader actually believes that soda is "food" with any nutritional value. Are you counting pennies? Are you hungry? If you are concerned about how you're going to afford soda, you may not actually have a problem worth writing your congressperson about. And if for families that are, as the press release from suggests, "struggling to pay their bills, protect their jobs and keep their homes in a recession," buying soda will not help them do any of these things.

Were Coke's CEO to read any Michael Pollan -- who suggests that soda and junk food should not be called "food" at all, recommends removing these products from eligibility for food stamp purchases, and generally blames soda for many of the nation's health care woes, as stated in a recent New York Times editorial -- or consider the American Heart Association's recent call for Americans to limit their added sugar intake to 25 grams a day, he might find other culprits more worthy of the "Soviet" label. Pollan goes so far as to say that, if healthcare reform is passed and insurance companies are required to cover Americans even with chronic diseases, "it's easy to imagine the [insurance] industry throwing its weight behind a soda tax," because "few things could do more to slow the rise of Type 2 diabetes among adolescents than to reduce their soda consumption."

New York City, too, deserves the association with Stalin: the city has launched an expensive, attention-getting ad campaign against soda. According to a Yale professor of epidemiology and public health, "the science on the issue is rock-solid, showing that sugary beverages are associated with bad health outcomes: obesity, diabetes, and, one recent study shows, heart disease."

Soda and other sugary drinks sold by Coke and Pepsi are unhealthful and are associated with obesity and chronic diseases. These facts are not disputed by either company. What's disconcerting is that both are usin their considerable political and social muscle -- not the least of which is the headline-grabbing comparison of Obama and Congress to a Communist state -- to shoot down these taxes. And they might succeed.

The profits of Coke and Pepsi are not of any concern to me, and shouldn't be of any concern to the politicians who represent Americans, who are hopelessly addicted to sugar. Sometimes it's the government's job to gently lead us in the direction of desired outcomes; in this case, the government wants us to stop being so fat and eat something nutritious, to slow the acceleration of our crushing public health crisis, with a little taxation. Or the government could put a corporation's profits ahead of the interests of its people. But we've seen how that works over the past decade, and it's not left us in a great place.

President Obama, please don't listen to Kent. Wanting to keep your citizens healthy and alive is not an un-American activity.
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