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Robert Frank on Soda Taxes

A couple days ago, the Cornell economist Robert Frank weighed in at the New York Times on Bloomberg's soda ban.  

The first part of the article is mainly about negative vs. positive freedoms.  Frank wants the government to guarantee positive freedoms (how many, I'm not sure) whereas I'd prefer the government primarily focused on guaranteeing negative liberties.  This is an old debate (I'm reminded of the chapter in Hayek's Road to Serfdom where he talked about the successful efforts to redefine the word "freedom.") and although I disagree with Frank, I at least understand where he is coming from (aside from the ad hominem connections between soda and tobacco).

What confuses me (because he's an economist) are Frank's economic arguments for a soda tax.  

In the 2nd to last paragraph he says:

The case for reintroducing such a proposal is strong. We have to tax something, after all, and taxing soft drinks would let us reduce taxes now imposed on manifestly useful activities. At the federal level, for example, a tax on soda would permit a reduction in the payroll tax, which would encourage businesses to hire more workers.

Yes, if we want public roads and schools, we do need to tax something.  But, I would have thought than an economist would argue that we'd want to tax things that create the least deadweight loss. And I would have thought there would be mention that we'd want taxes that are the least regressive (i.e., where the burden is not most heavily paid by the poor).

Maybe Frank is right and we should reduce payroll taxes, but how do we know soda taxes are the solution and are any less distortionary or are more progressive?  And why would soda taxes be the next best alternative to replace payroll taxes from an economic point of view?  Elsewhere, Frank has (very reasonably in my opinion) argued for across-the board consumption taxes in lieu of income taxes; so why now a soda-tax rather than an across-the-board consumption tax? There is no attempt to answer these important questions.     

Yet, he goes on in the concluding paragraph:

Evidence suggests that the current high volume of soft-drink consumption has generated enormous social costs. So to those who have lobbied successfully against a soda tax, I pose a simple question: How do the benefits of your right to drink tax-free sodas outweigh the substantial costs of defending it?

I disagree.  We don't know that soft-drink consumption per se has enormous social costs.  We have epidemiological-type studies/simulations based on correlations and assumptions but we don't know much from randomized controlled trials.  We also don't know that the costs (whatever they might be) are social rather than private.  As is well articulated in this article by Jay Bhattacharya and Neeraj Sood published in the Journal of Economic Perspectives when it comes to obesity more generally, the costs are primarily private. Moreover, the expenses to Medicare and Medicare are really just transfers not deadweight loss.

Frank ends with a question: "How do the benefits of your right to drink tax-free sodas outweigh the substantial costs of defending it?"

First, I don't think most opponents of soda taxes would defend "tax free" but rather argue against special exceptions/taxes for one type of food vs another (because, among other reasons, the definition if "soda" isn't all that clear - and there are many substitutes for sodas that may be more calorie dense).  But, more generally, the answer is that the economic research shows soda taxes to have small effects on consumption, yet with large deadweight loss, and no meaningful impact on obesity.  The answer, in short, is that I defend my perspective using economic logic and the empirical results from economic studies.  I'm willing to be persuaded by new evidence or economic reasoning, but Frank didn't offer anything new.  I'm a bit surprised an economist of the caliber of Frank didn't meaningfully engage with economic evidence we do have.