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Originally published February 9, 2010 at 4:06 PM | Page modified February 9, 2010 at 10:50 PM

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How the beverage industry doused plan for soft-drink tax

Employing a broad-based lobbying effort, the soft-drink industry has smothered a plan to tax sugared beverages — a plan advocates...

Tribune Washington Bureau

WASHINGTON —

Employing a broad-based lobbying effort, the soft-drink industry has smothered a plan to tax sugared beverages — a plan advocates said would have reduced obesity and helped finance a health-care overhaul.

Only months ago, public-health advocates believed the tax would be a natural for congressional Democrats looking for revenues to fund expanded health-insurance coverage. The soaring costs of treating ailments related to excess weight — including diabetes and heart disease — added urgency to the issue.

But the White House staff reviewing funding options never embraced the idea even after President Obama expressed interest last summer. A key congressional committee, after initially seeming receptive, ended up refusing to consider it. Several minority advocacy groups, including some committed to fighting obesity, lined up against the tax after years of receiving financial support from the industry.

Meanwhile, beverage lobbyists attacked some of the country's most distinguished nutrition scientists, accusing them of bias and distorting available evidence. The beverage industry also financed research that reached conclusions favorable to its position.

Coupled with similar initiatives in such states as California, the industry faced the specter of a full-scale national debate on sweetened soft drinks and their effect on health — and the nation's ever-higher medical bill.

Another alarm sounded last May when the Senate Finance Committee heard testimony from public-health advocates who proposed using a soda tax to help finance health-care legislation.

Analysts at Yale University have calculated that a penny-an-ounce tax would induce a 23 percent drop in consumption, and the Congressional Budget Office has estimated that a smaller tax could raise $50 billion over 10 years. While the extent to which such a tax might drive down obesity rates is scientifically unclear, nutrition experts argue it would, at the least, improve health by discouraging consumption of sodas, which have no nutritional value but are packed with calories.

A few weeks later, soda-tax advocates in the tax-writing House Ways and Means Committee reported initially favorable responses from colleagues during closed-door meetings. And Obama in July told a Men's Health magazine reporter that such a tax was an "idea that we should be exploring."

Rep. Linda Sanchez, D-Calif., recently diagnosed with gestational diabetes, was one of the committee members who pushed for consideration of the idea. Several other Democrats expressed support, including six-term Rep. Bill Pascrell of New Jersey and freshman Rep. Allyson Schwartz of New Jersey.

"Slippery slope"

Beverage lobbyists went to work, enlisting other industries to pressure members of Ways and Means. "The industries in our coalition realized that this is a slippery slope, that once government reaches into the grocery cart, your business could be next," said Kevin Keane, executive vice president of the American Beverage Association.

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The coalition, operating under the name Americans Against Food Taxes, included the soft-drink makers, their suppliers, and such mass marketers as McDonald's and Domino's Pizza.

Using the argument that higher food and drink taxes would burden poor people unfairly, the coalition recruited Latino groups, among them the Hispanic Alliance for Prosperity, the National Hispana Leadership Institute, and the League of United Latin American Citizens.

Public-health analysts were surprised to find the list included the National Hispanic Medical Association, which represents 36,000 Latino doctors and focuses on health issues such as obesity-related diabetes that hit Latino youth especially hard.

"Why in the world would a Hispanic health-advocacy group do this?" asked Kelly Brownell, director of Yale University's Rudd Center on Food Policy and Obesity.

Nearly all the Hispanic groups, including the Medical Association, had received beverage-industry money in the past or have industry representatives on their boards.

The Medical Association's director, Dr. Elena Rios, said the financial support — which amounted to no more than $10,000 from a single company — had nothing to do with the decision to oppose the tax, which she and the other Latino groups agreed would hurt minority communities. She also said the evidence is not clear that the tax would reduce obesity. (Rios said Friday that her organization had decided to withdraw from the industry coalition).

The coalition launched an intense lobbying effort, including a $10 million television ad campaign in key markets. The paper industry, a major supplier of products to fast-food companies, also contacted members of Congress. Even some truckers joined the fight.

By the time the Democratic caucus held its next closed-door meeting in early summer, Sanchez and others said the atmosphere had changed.

Rep. John Lewis, who represents Atlanta, the headquarters of Coca-Cola, argued the soda tax could lead to taxes on other foods, raising prices for hard-pressed consumers.

Rep. Ron Kind, who represents a rural Wisconsin district, said he became concerned about the fairness of targeting one industry. Kind had heard from local Pepsi and Coke distributors, and he and other members also received letters from the National Milk Producers Association concerned that the tax could apply to chocolate milk.

Debating the science

While winning its battle at the Ways and Means Committee, the soft-drink industry also was waging a long-term war over the scientific evidence linking soda consumption to the nationwide epidemic of obesity.

The industry attacked the findings of prominent nutrition scientists and underwrote studies by other scientists whose work was more supportive of beverage companies' claims.

Among the outspoken scientists criticized by the beverage association are Yale's Brownell and Harold Goldstein, who heads the California Center for Public Health Advocacy.

"Sugared beverages are the single largest source of sugar added to the American diet," said Brownell, noting that consumption averages 50 gallons a year for every American.

Goldstein recently joined with researchers at UCLA in a survey of 43,000 Californians that found adults who drink one or more sodas per day are 27 percent more likely than non-soda-drinkers to be overweight or obese.

Keane, of the American Beverage Association, said researchers such as Brownell and Goldstein are acting as advocates. "They pick and choose the facts that support their view, and they attack anyone who disagrees," including those whose work appears in peer-reviewed journals, Keane said. "It's scientific McCarthyism."

The American Beverage Association Web site for the campaign against the soda tax points to three studies in peer-reviewed journals that dispute a link between soda and obesity.

One was conducted by an author working for Archer Daniels Midland, a major producer of high-fructose corn syrup. Two were conducted by a researcher who now works for the Beverage Association; one of those studies was funded by a grant from the association.

Despite the funding source," Keane said, "the researchers worked independently and their findings were published in a peer-reviewed journal. That's the gold standard in the scientific community."

Some of the studies Keane cites point to sedentary lifestyles and high-fat diets as significant causes of weight gain. And, largely through reviews of previously published studies, they say the existing science on soft drinks' role is at best unclear.

Keane also says soda accounts for a little more than 5 percent of the average American's calorie intake, and that blaming soda for the obesity epidemic "defies common sense."

Goldstein says the industry is blaming obesity on physical inactivity — "that it's the couch, not the can." But one of the reasons Americans need exercise "is because they're drinking so much soda," Goldstein said.

One theory embraced by Goldstein and others is that the body has not developed a system for processing sugared beverages, relatively new to the human diet.

The beverage industry rejects the argument that liquid calories lead to greater weight gain, noting a study conducted by Frank Sacks, a professor in the nutrition department at Harvard School of Public Health. Sacks concluded that diets that reduce calorie intake result in weight loss, regardless of which calories are cut.

Keane argues that the study proves his point, that "a calorie is a calorie," regardless of whether it's consumed in solid or liquid form.

But Sacks disagrees: "I don't know how they possibly could come up with that kind of interpretation. "There was no testing of sugar-containing beverages, and in fact the participants were taught to avoid them."

Donor to doctor group

The industry also has cultivated an unusual relationship with the American Association of Family Physicians, sending a contribution "in the high six figures," association president Dr. Douglas Henley acknowledged, to underwrite "educational materials to help consumers make informed decisions."

Henley said "content development is completely independent" of the funding.

Harvard School of Public Health professor Walter Willett criticized the information on the association's Web site as "misleading and incomplete." The Web site advises men not to consume more than one can of soda per day, an amount, Willett says, that "will substantially increase risk of Type 2 diabetes."

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