City proposes a soda tax of one cent per ounce

Yesterday I heard a news story on the radio about new proposed soda tax of 1 cent per ounce in an American city. I don't remember which city. It was probably Boston or San Francisco. It irritated me to hear the announcer gleefully describing this new tax as a win-win situation because it is expected to raise 120 million dollars in revenue while cutting down on the consumption of sugary beverages by 20%.

I was angered because the giddy reporter was clueless as to the adverse affect this would have on people who worked for beverage industry and related businesses. A decline of 20% in the beverage industry in their city might amount to 600 million dollars of lost income for those who distribute, sell, produce and promote soda products. This city is willing to destroy peoples jobs and businesses, to the tune of 600 million dollars, in order to enrich the city coffers by 120 million.

When I lived in CA, I worked in a small gas station/convenience-store/auto repair shop. My boss was a good friend and I ran the mechanic shop for him. In the beginning, I was angered by soda deliveries being stored in "my workshop". Dozens of cases of soda were stored in the shop and I was constantly moving them around to make room to work. I complained about this bitterly to my boss.

My boss explained to me that soda sales pay the rent. He told me that we would all be without a job if it were not for the soda. He explained to me that the salesman offers him promotions (huge discounts) if he buys enough cases at a time. Sometimes he orders a huge amount of Pepsi products, which would anger the Coke salesmen. When the Pepsi Products sold out, the Coke salesman would make him an even better deal. They were both competing for space in the 3 coolers that we had in the store. But there was not enough space in the coolers for these huge orders, so he stored the overflow in the shop.

My boss passed the savings along to his customers and eventually his soda business was so good, that they offered him even bigger promotions (discounts). Now there was no way he could store hundreds of cases of soda in the shop so he rented an outdoor storage container the size of a small semi-trailer.

Many people made a good living off of the sale of soda. My boss paid his rent with the profits from the soda sales which made it possible for him to hire several store clerks and a mechanic. The sales-reps from Pepsi and Coke made a good living from their commission on the soda that they sold. The delivery drivers made a good living from their weekly deliveries of soda. The company that rented storage containers received a check from us every month. The customers were happy because cold refreshing beverages were available conveniently and at a good price. We would never run out, not even during the hottest days of summer.

If draconian taxes are placed on the beverage industry that cut soda sales by 20 percent, it would result in many people losing jobs and income. This is not a win-win situation to be giddy about. This would be a very sad day for many hard working Americans.