On March 1—one week after my blog post on sugar-sweetened beverage (SSB) taxes—PepsiCo announced that it will be cutting 80 to 100 jobs due to Philadelphia’s 2016 soda tax, which passed in 2016. Dave DeCecco, company spokesperson, said that if the tax is removed the company will bring the jobs back.

While PepsiCo’s reaction to the tax appears to be an effort to maintain the status quo, let’s take the announcement at face value. As a result of the policy, fewer sugar-sweetened beverages are being sold, impacting the local economy. This is an important consequence we need to be aware of, and PepsiCo is not alone in bringing it to the public’s attention.

Local businesses are reporting consequences, too. An article in Business Insider said, “Operators of local supermarkets have reported significant drops in revenue, something executives say will result in their cutting of jobs in the near future and have already forced them to slash employees’ work hours.”

It would be tempting at this point to back down from the tax. But if we are truly committed to health transformation, then we must invest and spend differently, and in doing so we will not be able to avoid impacts on our local economies—both good and bad. It’s important not to shy away from doing things differently. Instead, leaders can proactively open a new dialogue with the community as they consider the best ways to address or avoid potential negative consequences like the elimination of jobs.

When multi-sector partnerships (MSPs) seek sustainable financing for population health in their regions, it’s inevitable that they’ll need to navigate community members’ cheers and fears about new proposals. Having these conversations about costs and benefits (whether they are real or perceived) will hopefully lead to wise design choices on the front end—choices that could potentially minimize the burden on stakeholders. Also, MSPs can use information learned during the conversations to frame a new public narrative around the positives associated with changing the status quo, even if there are short-term costs.

So what does this mean for Philadelphia, PepsiCo, and the local grocers? For one, the city could consider ways to minimize job losses while still leading the public to understand (and want!) the benefits of the new tax. Business Insider reports that PepsiCo has been “investing in less-sugary drink options that wouldn’t be subjected to the taxes…[and has been saying] an increasing percentage of [its] business comes from the sales of things like bottled water, healthy snacks, and tea—not soda.” Perhaps the city could offer a tax credit equal to the job losses, to retrain workers in support of these efforts and population health?

Mayor Jim Kenney is already touting the law’s benefits, working hard to shift the narrative from “the soda tax is killing jobs” to one that shows the soda tax has actually created jobs. With the revenues being used to expand access to pre-K for children, there are already 250 new jobs for teachers and support staff! What’s more, he is acknowledging that there’s been a 50 percent drop in beverage sales. He’s also wisely proclaiming that people are getting healthier since they’ve reduced their consumption—and the financial benefits of that have yet to be calculated. Kenney’s framing is helping to ease the transition to new ways of doing things.

Still, new questions emerge for communities interested in following Philadelphia’s lead:

  1. Are there other creative ways to frame soda tax revenue as a way to add opportunities for more, but different, jobs?
  2. As communities plan for the use of tax receipts, could they also estimate any potential burdens, and prepare transition plans that dedicate some of the revenues to help those who are harmed as their local economies move to a different but more healthy mix of spending and investments?
  3. What role should MSPs have in working with community members to address any negative consequences?

Whatever the answers, the wisest leaders of population health initiatives will make a genuine attempt to anticipate and address possible negative consequences. Soda taxes in particular can be a win-win, increasing revenue and population health at the same time, but only if leaders are ready to take on the hardest questions as they pursue change.

Let me know your thoughts below or find me on Twitter @kwrigh02 

 

The personal views and opinions expressed in this blog (and in any comments) are those of the original authors only, and do not reflect the opinions of The Rippel Foundation or ReThink Health. Neither The Rippel Foundation nor ReThink Health is responsible for the accuracy or validity of any of the information contained in the blog or any comments. All information is provided on an “as-is” basis.

Join the Conversation

  • Bobby Milstein

    Thanks for raising this topic, Katherine. Some of the most wrenching challenges that arise when shifting from a harmful to more healthful economy revolve around the disruption in people’s livelihoods–as well as in entrenched corporate routines. Too often, the prospect of any progressive shift devolves into a narrative of fear, marked by false choices between health vs. jobs or planet vs. people.

    Such stark choices are usually a sign that someone is trying to perpetuate–and profit–from the status quo. See scores of examples from the Corporations and Health Watch, including intricate details about soda tax campaigns (http://www.corporationsandhealth.org/2014/11/05/big-food-uses-dirty-tricks-ballot-fights-gmo-labeling-soda-taxes/).

    Many leaders in the labor movement have devised a more productive stance by trying to achieve a “Just Transition” (https://en.wikipedia.org/wiki/Just_Transition). This framework offers practical ways to “secure workers’ jobs and livelihoods when economies are shifting to sustainable production…”. It embraces the imperative to transform entire industries, while rejecting the typical path where economic restructuring happens in a, “chaotic fashion leaving ordinary workers, their families and communities to bear the brunt of the transition to new ways of producing wealth, leading to unemployment, poverty and exclusion.”

    For an eloquent story about the struggle for a Just Transition from coal to clean energy, see this presentation by Lisa Abbott (from Kentuckians for the Commonwealth) at the National Academies workshop on Protecting Health and Well-Being in a Changing Climate:.http://nationalacademies.org/hmd/Activities/PublicHealth/PopulationHealthImprovementRT/2017-MAR-13/Videos/Panel-1-Videos/6-Abott-Video.aspx.

    Major economic shifts often seem unattainable. However, we draw insight from past successes where large parts of the economy have indeed moved away from harmful and even immoral practices. Consider, for instance, the efforts to end slave labor, child labor, whaling, tobacco, and more. While there is more work to be done in each of these areas, they have all enhanced the economy and improved people’s lives on a massive scale, in ways that had once seemed unthinkable.

    More sources on this theme are in the ReThink Health Financing Primer, in the section on movements and initiatives to reshape regional health economies (https://www.rethinkhealth.org/tools/financing-primer/the-movements/). Folks will find links there to groups like the Business Alliance for Local Living Economies (https://bealocalist.org/) and the Democracy Collaborative’s collected resources on Building Community Wealth (http://community-wealth.org/), among others.

    What do others think it will take to transform the wider economy without pitting jobs against health?

  • Bobby Milstein

    Thank you for raising this topic, Katherine. Your piece sparked several thoughts, along with a few connections to others. I’ll try to summarize the highlights in a quick comment.

    Some of the most wrenching challenges that arise when shifting from a harmful to more healthful economy revolve around the disruption in people’s livelihoods–as well as in entrenched corporate routines. Too often, the prospect of any progressive shift devolves into a narrative of fear, marked by false choices between health vs. jobs or planet vs. people.

    Such stark choices are usually a sign that someone is trying to perpetuate–and profit–from the status quo. See scores of examples from the Corporations and Health Watch, including intricate details about soda tax campaigns (http://www.corporationsandhealth.org/2014/11/05/big-food-uses-dirty-tricks-ballot-fights-gmo-labeling-soda-taxes/).

    Many labor leaders have devised a more productive stance by trying to achieve a “Just Transition” (https://en.wikipedia.org/wiki/Just_Transition). This framework offers practical ways to “secure workers’ jobs and livelihoods when economies are shifting to sustainable production…”. It embraces the imperative to transform entire
    industries, while also rejecting the typical path where economic restructuring happens in a, “chaotic fashion leaving ordinary workers, their families and communities to bear the brunt of the transition to new ways of producing
    wealth, leading to unemployment, poverty and exclusion.”

    For an eloquent story about the struggle for a Just Transition from coal to clean energy, see this presentation by Lisa Abbott (from Kentuckians for the Commonwealth) at the National Academies workshop on Protecting Health and
    Well-Being in a Changing Climate: http://nationalacademies.org/hmd/Activities/PublicHealth/PopulationHealthImprovementRT/2017-MAR-13/Videos/Panel-1-Videos/6-Abott-Video.aspx.

    Major economic shifts often seem unattainable. However, champions of change may draw insight from past successes where large parts of the economy have indeed moved away from harmful (if not immoral) practices. Consider, for instance, the movements to end slave labor, child labor, whaling, tobacco, logging, and more. While there is more work to be done in each of these areas, they have all enhanced the economy and improved people’s lives on a massive scale, in ways that had once seemed unthinkable.

    Many more sources on this theme are in the ReThink Health Financing Primer, in the section on movements and initiatives to reshape regional health economies (https://www.rethinkhealth.org/tools/financing-primer/the-movements/).
    Folks will find links there to groups like the Business Alliance for Local Living Economies (https://bealocalist.org/)
    and the Democracy Collaborative’s collected resources on Building Community Wealth (http://community-wealth.org/),
    among others.

    What do others think it will take to transform the wider economy without pitting jobs against health?

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