Byko: Are we seeing the death of soda?
Its a big loser even before the tax
SOMEWHERE, John Franklin Street is smiling.
The 97th mayor is remembered for many things, among them constantly hectoring people to drink water.
It seems we got the message - to the dismay of what Mayor Kenney loves calling "Big Soda" and what others refer to as CSDs, or carbonated sugary drinks.
Sales of CSDs last year fell for the 11th straight year, hitting a 30-year low, Beverage Digest reported in March. In the last 20 years, soda sales plummeted by more than 25 percent.
That is another reason the proposed massive tax on sugary beverages is unlikely to do what Kenney expects - help fund quality, universal pre-K, plus upgrades for some parks and rec centers, totaling $80 million per year.
Not only is regular soda on the rocks, last year's decline was led by sugar-free drinks, with Diet Coke and Diet Pepsi each losing more than 5 percent in sales.
That fact may puncture Councilman Allan Domb's idea to replace Kenney's outlandish 3-cent-an-ounce tax on sugary drinks with a smaller tax on both sugary and diet beverages.
Consumers are running away from soda even without a tax increase that could double the price of some CSDs. Health-conscious people are turning to water, with "sparkling water growing fast," I'm told by Duane Stanford, editor of the authoritative Beverage Digest.
Stanford and I chatted Wednesday while City Council held hearings on the proposed tax.
Council President Darrell Clarke seems cool as penguins' feet to a big tax that will fall hard on his low-income constituents.
Councilwoman Blondell Reynolds Brown is looking at a tax on containers, such as bottles, while Councilwoman Maria Quiñones-Sánchez wonders, as have I, why pre-K money can't be found in the city's $4 billion budget. Domb says courthouse fees, which have not changed in 30 years, could be increased.
All are ideas worth exploring.
From politics, let's move to soda economics and demographics.
Bottled water sales are expected to surpass those of soda within a few years, according to the Beverage Marketing Corp. If we are looking at the death of soda, that makes it a rotten revenue source.
In 2014, Gallup reported that nearly two-thirds of Americans avoid soda. That number is growing. They may know a 20-ounce bottle contains 15 teaspoons of sugar. Ugh.
The average American consumes 648 eight-ounce servings a year - almost two a day, says Stanford. (Pennsylvanians drink 521 servings.) There is more consumption "in lower-income areas and lower consumption in more affluent areas," says Stanford, which means the tax falls more heavily on the poor, something city Finance Director Rob Dubow reluctantly conceded.
While that may be true, some argue, the poor will be the biggest beneficiaries. The gaping hole in that argument is that they benefit only if they have pre-K-age children or younger.
Males are more likely to drink CSDs than women; children and young adults drink more than older people; nonwhites consume more than whites; and more is consumed in the South than any other region, according to Gallup. The soda tax has been tried 31 times before, successful only in the People's Republic of Berkeley, Calif., a city of only 118,000.
When a soda tax is proposed, the beverage industry fights ferociously, partly because it's in rough waters now, partly over fears soda will be turned into the New Tobacco - an "evil" industry that must be exiled and taxed out of existence.
Do I oppose pre-K? No, I await a fair and effective way to pay for it. (I have made suggestions on my Stu-niversity blog.)
Singling out soda is discriminatory (open to possible legal challenge, says City Solicitor Sozi Tulante), unfair, and - taking into account already falling soda sales - doomed to failure.
Can City Council devise a fair and effective plan?
We'll find out soon.
215-854-5977 @StuBykofsky
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