When Bad Things Make Sense

It looks like Philadelphia is taking a very strong stance by proposing legislation to add a soda tax of $0.02/beverage ounce. This appears to be the biggest tax initiative so far, with the rationale that the tax will act as a deterrent, or at least will fund the care needed for health issues related from these foods. On the surface, a sin tax may seem like a good idea, but there are a few huge problems that undercut the usefulness of this legislation.

One is cheap, but the other is good for you.
The first issue is the everyday cost difference between nutritious and junk foods. Junk food is cheap. It's cheap to make, cheap to ship and store. And because junk food also tends to be high in calories, the cost/consumed energy is lower than that of something more healthful.

One reason is due to politics. Industries like dairy, meat, corn, and grain are heavily subsidized, much more so than fruit and vegetable crops. And while all foods incur transportation costs, fresh foods need careful refrigeration, handling and limited storage times to prevent spoilage. Processed foods can avoid these extra costs, which also keeps the prices low. This chart shows the cost difference between foods like fruits and cookies. The healthful foods have gotten more expensive over time, while the cost of bad-choices food drops.

(the data is U.S. Bureau of Labor Statistics, and the chart was made by David Leonhardt of the New York Times, from the May 20, 2009, article "What’s Wrong With This Chart?")

We used the words "bad-choices food", but sometimes the unhealthy option is the best option or "least-bad" decision. This is when the cost just to eat is really difficult to manage. According to Feeding America, the largest domestic hunger-relief charity, there has been a 46% increase in the number of families that have needed food aid within the past 4 years. And the hallmark of junk food is that it's low in nutrients, but high in calories. If you're poor, really poor, and it's hard just to purchase food, then that cheap, but calorie-laden gallon of Sunny-D is a better buy than the half-gallon of orange juice.

What the ghetto and the country have in common.
The second problem is when money isn't the barrier. Depending on where you live, you may not have access to fresh fruits and vegetables, because there aren't grocery stores in your neighborbood. This is called a "food desert" and it occurs when an area has no supermarkets, or easily-accessible public transportation to get to a store. If you're young, healthy, or have access to a car, then the lack of a real store in your area is an inconvenience. But when you're elderly, disabled, or even working a few jobs to stay afloat, then it becomes very difficult to eat a healthful meal from the food at the local convenience store. These stores, especially the franchise ones, tend to stock more processed and canned goods than fresh, which means more added sugars or salts used as preservatives. Also, because of limited shelf space, the fresh food that is there is higher than in the regular store. It's expensive to be poor, and families both in urban and rural areas are affected.

Who benefits?
There's a definite correlation between food choices and health issues like Type II diabetes and obesity. But because income levels also track these problems, increasing food costs needs to be carefully considered. Philadelphia's proposal taxes the bad foods, but only earmarks 1/3 of the revenue for health related issues -- the bulk of the proceeds will go to the city's general funds. Hopefully this will allow the city to address the surrounding issues that drive people's food choices, because it's not always irresponsibility that puts junk food in the pantry.