Mexico City—Not a day passed by without Sergio Gonzalez making his trip to the corner store in for his fix of Coca Cola. Without his morning regimen of downing a twenty-ounce bottle of Coke, Gonzalez would find himself falling into listlessness or experiencing a headache. As an attendant for a busy parking lot in the middle of Mexico City, he couldn’t afford to miss a beat.
“I couldn’t get through the day without having at least three bottles of Coke,” he said.
Were it not for a successful campaign undertaken to combat the unhealthy habits of millions who either drank large quantities of sugar-based drinks or were essentially addicted like Gonzalez, many Mexicans might not have made changes to their diet.
“I didn’t think much about picking up coquitas every day until I began to see those billboards.”
Gonzalez was referring to a contentious campaign by the Nutritional Alliance for Health, a civil-society coalition that bought billboard space across the country in 2012. One billboard asked parents whether they would knowingly give twelve teaspoonful’s worth of sugar to their children. Another depicted a diabetic whose feet had been amputated. When the coalition was denied advertising time on all of the major free-to-air networks, it resorted to cable television and went on to successfully lobby for the tax, which was supported by Mexico’s President Peña Nieto’s administration. Legislation establishing the tax was enacted in October 2013.
As a result of the campaign and the implementation of the soda tax—one peso, or 53 cents in U.S. currency, per litre—many Mexicans simply decided to either give up their sugary beverages altogether or significantly cut back.
“Now, I go for coffee or water at the corner store. I still drink a coquita now and then, but I’ve definitely cut back a lot,” Gonzales said in an interview. “It has been weeks since I drank my last one.”
Before Mexico’s soda tax, Hungary, France and more than a dozen other European countries had already passed their own versions of it. However, the expectations and interest that went into Mexico’s adoption of the tax were higher than elsewhere due to the simple fact that Mexico was, by some measures, the most obese nation in the world. It also led most other countries in rates of diabetes and heart disease.
Studies have shown that more than 70 percent of the country’s nearly 130 million people are either overweight or obese and, according to the Organization for Economic Cooperation and Development, Mexico has the highest diabetes rates of any developing country. Other studies estimated that, on average, each Mexican drank almost a half-liter of chescos (a Spanish term for sugar-sweetened beverages or sodas) per day or 163 liters per year. The country led the world in the consumption of sugar-based drinks—at least before the tax went into effect.
Since the tax went into effect in 2014, data from several of studies have exceeded the expectations of even its advocates. Several other countries—as well as cities in the United States—have taken notice. Many have adopted their own taxes on sugary beverages or are considering doing so.
“The soda industry has a problem: they sell liquid sugar without any nutritional value at all, which puts the industry in a position that makes them particularly vulnerable,” New York University professor and author Marion Nettle, a leading expert on health policy, told Tarbell.
Mexico’s “Domino Effect”
Beverage industry executives and spokepeople, including Jorge Romo of the National Association of Refreshment and Carbonated Producers were, not surprisingly, opponents and naysayers of Mexico’s soda tax. Romo told The Guardian before the tax was implemented that he didn’t believe the tax would make a significant long-term difference in the consumption of sodas and other sugary beverages. “Maybe in the first three, four or six months but afterwards, it will become exactly the same or maybe a few percentage points difference,” he said.
He has been proven wrong.
A study jointly conducted by researchers at the University of North Carolina and Mexico’s National Institute of Health found that purchases of sugar-based beveraged continued to decrease in the second year of the tax.
Purchases of the beverages were down 5.5 percent the first year. They dropped to nearly 10 percent the second year.
“The tax is working” toward its objective, Shu Wen Ng, senior author of the bi-national study, told Reuters last year. She noted that the poorest households showed the biggest drop in purchases—an average of nearly 12 percent over two years.
Researchers at the University of California, San Francisco used a computer model to estimate the impact of the tax on the rate of diabetes in Mexico. The researchers concluded that “almost 200,000 cases of diabetes that would…be expected to occur over the next 10 years would not occur because of the decrease in soda consumption in Mexico.”
North of the Mexican border, Berkeley, California in 2015 became the first U.S. city to pass its own soda tax. Other cities soon followed, despite fierce opposition—in the form of well-financed PR and lobbying campaigns—from the beverage industry. To date, Philadelphia, San Francisco, Seattle, Boulder, Colorado, and Oakland and Albany, California have enacted their own taxes.
The results in Berkeley have been significant: purchases of sugary beverages there fell 21 percent in the first year.
“The work in Mexico definitely was an inspiration for the folks working in the U.S. on this, as it pre-dated Berkeley and at the time of its adoption, was the most substantial tax on sugar products anywhere in the world,” said Jim Krieger, the founding director of Healthy Food America, a nonprofit organization that conducts public interest campaigns aimed at encouraging the adoption of public policies “to to ensure that all people have access to healthy, nutritious food and are less exposed to unhealthy junk foods.”
In Berkeley and Beyond, “Political Tides Are Shifting,” As Well as Drinking Habits
As a result of the successful implementation of a tax in those U.S. cities, In most cases, the taxes were levied via ballot initiatives. In Philadelphia and Seattle the taxes there were enacted by their city councils.
Almost as much as Mexico, Berkeley was an inspiration for other cities considering a soda tax. In spite of the multi-million dollar campaigns conducted by the beverage industry to try and kill soda tax initiatives, advocates in Berkeley say they were not surprised their city was a trail blazer.
“People in Berkeley realize that at the end of the day, people’s health is more important than corporate profits,” said Pamm Shaw, director of a YMCA program created to educate Berkeley residents, young people in particular, about how sugar-sweetened beverages can affect their health.
Berkeley city Councilmember Linda Maio said in a recent statement about the tax that, “Our (the city’s) aim is to increase awareness of the health risks of sugar-sweetened beverages among Berkeley youth, particularly those from low-income families, the demographic most vulnerable to illness caused by sugar-sweetened beverages.”
Since 2015, more than $6 million has been raised from Berkeley’s soda tax. The proceeds have gone to educational programs including Healthy Black Families, Berkeley Unified Schools, the Ecology Center, Lifelong Medical and the YMCA which Shaw directs.
Shaw told Tarbell the money the YMCA receives is used for a diabetes-prevention program that targets people who are pre-diabetic or at risk of developing the disease and also for a program to educate parents about how to shop for healthy foods. “We also have a nutrition specialist who is tracking kids obesity rates, she said.”
Amelia Ott can be counted among the beneficiaries of those programs. As a single-mother raising a four-year-old boy, Ott said in an interview that “when all of the signs (about the tax) went up, it was put in front of a lot of people’s face that sugar-sweetened drinks are bad for you and went beyond just sodas.” She said her family had consumed not just sodas but a lot of Gatorade and sweetened iced teas.
“I still have a soda every once in a while but now much more often I go for a bottle of water or juice instead, especially for my kid,” she said.
Local, Community-Based Initiatives Form Bedrock of Most Soda Tax Initiatives
In Philadelphia, where the soda tax went into effect in January 2017, the additional revenues have been allotted to fund local development, job training and prekindergarten programs. In Boulder, the tax is funding local health and general-wellness programs as well as preventative measures against as diabetes and other chronic diseases.
In Seattle, part of the revenue from the tax will be used to fund social programs to help people on food stamps buy more fruits and vegetables. In Oakland, much of the estimated $6 million to $8 million expected to be generated will be used for nutrition and wellness programs primarily directed at youth.
Oakland Councilmember Annie Campbell Washington was quoted by the East Bay Express as saying that she has contacted by public officials across the nation interested in implementing their own soda taxes.
To experts such as Nettle, it is precisely these local initiatives that make soda taxes viable to gaining popular support.
“Local causes that people believe in and support,” are crucial,” she said.
Setbacks and Uncertain Future
The political clout of the beverage industry, however, is the biggest obstacle to the implementation of taxes in other cities. Last summer, the Illinois Retain Merchants Association (IRMA) won a lawsuit in the Cook County Circuit Court that ended the short-lived one-percent soda tax in Chicago.
“There’s an extraordinarily high level of frustration and anger” among the 20,000 stores IRMA represents, the organization’s president, Rob Karr, told the Chicago Tribune.
What proved to make the Cook County tax vulnerable was the fact that no local funding mechanism had been put in place for social programs and public health.
The American Beverage Association (ABA) is the industry’s main lobbying organization, and it has spent heavily to beat back soda taxes wherever they have proposed.
The ABA reportedly spent more $30 million in its campaigns against the initiatives in Berkeley, Oakland and Albany, California. It’s efforts failed there but succeeded in other California cities, including Sacramento, Richmond and Almante. Nationwide, the ABA has helped defeat more than 40 initiatives since 2008.
But with soda tax advocates’ more recent victories in some of the nation’s biggest cities on both coasts, other munipalities, and even some states, believe momentum may, at last, be on their side.