Cut the Corny Crap

I’ve recently seen this ad on TV and YouTube:

The ad was made by Americans Against Food Taxes, an interest group that includes some big agro-businesses and industrial fast food producers who are opposed to a proposed tax on soft drinks and juice drinks, in other words, beverages that contain high fructose corn syrup (HFCS).

Pardon the pun, but this ad, like HFCS found in soft drinks and juice drinks, is pretty corny stuff.  Let’s cut through the saccharine images of an All-American family and the folksy populist spin.  First, “juice drinks,” as defined by the USDA is different from “100% juice.”  Juice drinks only constitute a small percentage of actual fruit juice, and can contain added water, sugar/HFCS, coloring, and vitamins.  In these USDA health guidelines (PDF), the example juice drink only contains 5% juice.  The proposed tax is on soda and juice drinks, NOT on 100% juice or fresh fruit.  Last time I checked, soda and juice drinks were not essential foundations in the food pyramid.

I’m no fan of big agro-business lobbies or a Federal nanny state, but guaranteeing all Americans basic access to health care is an important issue that needs funding.  So where do we go from here? Well, if we follow the money (and the trail of corn kernels), we find that soft drinks and juice drinks are able to be sold relatively cheaply because of existing government intervention in the form of subsidies.  These government subsides—our taxpayer money— artificially lower the price of corn and corn derivatives like high fructose corn syrup.  When we buy a soda, we aren’t paying the REAL market price because the cost of producing corn syrup, a major ingredient, is subsidized by our tax dollars.  Hey, isn’t that soda socialism or something?

Now here’s the part where I might even get mistaken for a conservative:  Instead of levying taxes on soda and juice drinks to fund health care, why not just cut costs by reducing or even eliminating the corn subsidies, and use the savings to fund health care reform?  These subsidies are taxes that we have already paid that are a standing government bailout that props up an essentially non-market-based business model.

Insert folksy Fox News-worthy soundbite:  “Calm down about socialized medicine ’cause corn subsidies ain’t so capitalist either!

The Environmental Working Group’s Farm Subsidy Database shows that there were $21.6 billion in corn subsidies in the four-year period from 2003-2006 (inclusive).  The Global Development and Environment Institute at Tufts University found that HFCS producers received an implicit $234 million dollar a year subsidy derived from overall corn subsidies.  Meanwhile, the WSJ reports that the Congressional Budget Office estimates that “adding a tax of three cents per 12-ounce serving to these types of sweetened drinks would generate $24 billion over the next four years.”  If the amount of money spent on four years of corn subsidies were redirected towards health care, we would already be 90% of the way to the potential $24 billion that could be raised by new taxes on soda and juice drinks.

Why bother with new taxes on struggling American families when the government can just stop using our taxpayer money to subsidize artificially-cheap corn, the staple of the industrial agro-businesses, and use it as a down payment on health care reform?