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Street Talk: The Soda Debate — Simple Pleasure or Guilty One?

Here’s a great case study for an introductory class in public policy advocacy.

[IMGCAP(1)]Your client makes a product that has about 150 calories and negligible nutritional value. It tastes great but is contributing to the country’s obesity epidemic. It is relatively cheap and especially popular among poorer citizens, who are disproportionately obese.

Meanwhile Congress, sensing a potential revenue raiser, wants to slap a federal excise tax of 3 cents per 12 ounces on every drink sweetened with sugar or high-fructose corn syrup.

That would cut back on soft drink consumption by an estimated 3 percent, throwing people out of work and shrinking overall tax revenues. Net that out, however, and you’re still going to raise an estimated $24 billion over the next five years, says the Congressional Budget Office. That’s not chump change.

So far, however, a federal soda tax has been a nonstarter. Whether the industry’s $2 million ad campaign had much to do with that is difficult to gauge; there are plenty of factors conspiring to stop Congress from taxing sodas that are bigger than a print or television ad.

Still, after a May Senate Finance Committee roundtable broached the idea of increasing the tax on beer and adding a tax on soda, the American Beverage Association leapt into action.

A mid-size trade group with a $10 million budget, the ABA represents 90 percent of the nonalcoholic beverage market — which includes 220,000 employees and sales of some $110 billion a year.

On July 12, with money it had assessed from its members, it began an inside-the-Beltway TV and print campaign — nobeverageandfoodtaxes.com — that’s still going on.

The print ad duplicates the final scene in the 30-second television spot, and it was produced by Goddard Claussen of “Harry and Louise— fame.

But on first glance, it resembles a “Saturday Night Live— parody — a 40- or 50-somethingish couple in a romantic moment seated in front of a campfire, each holding a can of soda. To drive home the point, a two-liter bottle marked “Soda— in large white letters is visible next to an orange cooler; there is a peaceful body of water behind the couple, and a tent, with a dim light inside, is off to the right.

The romantic implications of a soft drink before bed? It’s an interesting notion, to say the least, especially with a print ad that reminds many people of a spot for Eddie Bauer or Cialis.

“We didn’t want a hard-hitting ad,— ABA Senior Vice President for Public Affairs Kevin Keane says with some understatement. “We’re not looking to undermine health care, so our tone and approach was important.—

There are many credible reasons not to add a federal tax to sugar-sweetened sodas. There’s a fairness argument: Why tax one nutritionally deficient product and not another? A censorship argument: Do we really need food police to tax us into certain nutritional choices? A statistical argument: While the obesity rate has jumped 37 percent since 1998, soft drink sales have declined 9 percent.

And there’s the regressive tax argument — that poor people will spend disproportionately more of their income on a 3-cents-a-can soda tax than those earning comfortable salaries.

The beverage makers eschewed those arguments and took another tack, one that ties soda drinking to life’s “simple pleasures— — lying on the sofa and watching TV, driving down the parkway in a convertible, skipping rocks in the creek.

It may seem a bit far-fetched, especially to cynical Beltway insiders who are not inclined to invest much emotion in a can of Pepsi, but, Keane says, that theme kept “coming back in the verbatims.—

“We asked people How do you feel about a tax on soft drinks?’ and they’d say Sodas are a simple pleasure, and we’ve got enough problems’ without adding an additional tax.—

The focus groups were conducted by Public Opinion Strategies, a well-known GOP survey research company. Partner and health care expert Bill McInturff, who declined comment, was the lead on the account.

Goddard Claussen partner Ben Goddard, who directed the ad, was shooting another assignment and e-mailed that he did not have time to talk.

Goddard Claussen Associate Vice President Sue Zoldak, who worked on the ad, said the firm “conducted a lot of research to get the right message and the right messenger.—

People, she said, are “very emotional about taxes and their budget and what the government should and shouldn’t do. That’s where the heart of this issue is — family, budget, choice.—

And it’s true that for some, and possibly many, people there are certain associations with soft drinks that hark back to what seemed like a simpler time. Says one advertising expert: “You can’t make this thing too technical. You want to get people to buy into the concept that they’re trying to tax something that’s important to you.

“If I have a chicken salad sandwich and get a Coke to go with it,— he added, “that brings back memories with my family on the riverbank on the Missouri.—

In the end, the House Ways and Means Committee opted for a surcharge on the very wealthy to pull an extra $550 billion into the Treasury over the next 10 years.

In what was estimated to be 82 hours of meetings among committee Democrats, the idea of a soda excise tax was seriously discussed, according to one Ways and Means staffer.

“We spent a lot of time on it,— the staffer said. “We talked about chocolate milk, lemonade, non-soda pop, fruit drinks, drinks with added sugar, potato chips. It’s a question of picking one thing from all those to tax.—

But the staffer said the main reason an excise tax didn’t end up in the final package was an overarching committee decision to have one big revenue raiser. It was also, the staffer added, “a small amount of money for a controversial thing that some people would live and die for.—

There are some tougher ads in the can, says one soda industry insider — ads with a bit more “growl.—

And the industry may soon need to put them into production. The long-term sales outlook for domestic soda can’t be good; the drink is under increasing assault by nutrition experts and, many would argue, common sense — if obesity is a problem and an excise tax cuts down on the consumption of calorie-laden food, why not use a bit of taxing power to alter behavior?

For a large percentage of the population, it’s no longer the theme of “simple pleasures— that resonates each time you pop open the tab on a soft drink can.

It’s a “guilty pleasure,— and, health advocates argue, one an increasingly obese society can ill afford.

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