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McDonald’s and Coca-Cola: An Unhealthy Alliance

Opinion

Today the New York City Board of Health approved Mayor Michael Bloomberg’s proposal to limit the size of sugary soft drinks. Motivated by rising diet-related chronic diseases (along with healthcare costs), the Mayor’s attempt to rein in out-of-control portion sizes caused quite a media firestorm. Predictably, the soda lobby has come out swinging, complete with an industry front group called “New Yorkers for Beverage Choices.”

A better name would be: “Soda Pushers for Continued Profits.”

According to Beverage Digest, fountain sales (versus packaged) make up about 24 percent of the 9.3 billion cases of soda sold each year, or $18 billion in a total market worth of $75.7 billion.

Coca-Cola will be especially impacted by cup size limits, as that company controls 70 percent of U.S. fountain sales, followed by Pepsi with 19 percent and Dr Pepper Snapple with 11 percent.

While it’s obvious that the soda industry would be on the defense, largely missing from the debate so far has been the role of the fast food and restaurant industry as a significant driver of soft drink sales. (Due to legal constraints, the city’s soda proposal would only apply to food service establishments and not retailers).

The fast food industry has gotten plenty of flak for pushing a diet of cheeseburgers, French fries, and other highly processed pseudo-foods, but they should also be recognized as a major purveyor of sugary beverages.

For example, McDonald’s should be held accountable for its role in allowing the creeping up of cup sizes from a reasonable 7 ounces in 1955 to the current “large” of 32 ounces (310 calories for Coke), a more than 4-fold increase. Even a child size at 12 ounces is almost twice as large as the original.

The fast food king has already expressed its displeasure with cup size limits, suggesting instead “a more collaborative and comprehensive approach.”

No wonder, since Edward Jones estimates that five percent of McDonald’s revenue comes from soft drinks. Last year, McDonald’s revenue reached a record $27 billion; therefore at least $1.35 billion came from beverages.

That figure may be too low, because according to the research firm Technomic, carbonated soft drinks account for about 10 percent of fast food and fast-casual restaurants sales in the U.S.

Factor in the profit margins on such beverages–estimated to top 90 percent–and as Ad Age noted, “the potential impact on the bottom line becomes clear.”

Whatever the figures, the money at stake here is huge–for both the beverage industry and the fast food industry.

This explains why among those listed as alleged “New Yorkers for Beverage Choices” are not only the major soft drink companies but numerous restaurant chains, including: Carls’ Jr, Chick-Fil-A, Domino’s Pizza, Hardee’s and of course, the National Restaurant Association, whose members include McDonald’s.

That trade group, along with its network of state restaurant associations, boasts more than 200 national, state and local lobbyists. The restaurant industry has fought against every common sense nutrition policy over the decades, including menu labeling and regulating marketing to children.

Speaking of children, the downsizing of soft drinks will have an important impact on them as well. Children learn acceptable standards by what appears normal. McDonald’s has been teaching kids that supersized fries, Big Macs and large sodas are A-OK. By bring cups down to size, children get a better message.

And that’s another reason McDonald’s and the rest of the fast food industry is teaming up with the soft drink lobby to stop this proposal. They don’t want kids to grow up thinking 16 ounces is normal, because that means setting kids up for a lifetime of saner (and healthier) drinking habits.

Industry also knows that if limits are enacted in New York City, it’s only a matter of time before other cities around the nation follow Mayor Bloomberg’s lead.

Get ready for the next front group to pop up in your area, but don’t fall for it. Instead, let’s tell McDonald’s and Coca-Cola that enough is enough.

Michele Simon is a public health lawyer and an advisory board member and consultant for Corporate Accountability International. This post originally appeared on the Corporate Accountability blog September 11, 2012.

© Food Safety News
  • John

    Limiting soda sizes will do NOTHING whatsoever to curb obesity. The ONLY effect will be a further erosion of our already rapidly-declining freedom and liberty. America, land of the sheep. We are free to do only what we are told do, kept under control by the never-ending threat of violent police thugery.

  • Mike Hiebert

    Like everything else the government gets involved with, freedom of choice and individual responsibility has to “go” in order to be controlled by the elite liberals. If this is “good” then why not control everything? Oh by the way, that’s exactly what liberals want. More government, bigger governement, more intrusive government, that’s their montra.
    Good luck America. Can you say good by to your freedoms.
    Mike

  • http://www.bojangles-franchise.com/ James @ Fast Food Franchise

    I don’t know if this will really help. I guess time will tell. I just think that if you can’t get a bigger drink, then just buy another small one or go out and buy the bigger ones at the supermarkets and drink them at home.

  • pat simon

    NPR reported this morning that the Mayor’s rule will not affect 7-11 (and, I’m assuming, similar establishments). Therefore, ample opportunities to over-consume these sugary drinks will remain widely available. I think that’s a shame, but for those who want to consume this stuff, no worries.

  • http://www.phfspec.com Peter Cocotas

    For the soft drink companies profit margins on diet soft drinks are twice as much as those with sugar.

  • Michael Bulger

    The research shows that even if the size-restrictions are only mildly effective then there will be a reduction in calories consumed (http://www.nejm.org/doi/full/10.1056/NEJMc1208318?query=featured_home&amp ;) . This can only help reduce obesity, and at this point in the national health crisis, it should be fully pursued.
    As for the issues of “freedom and liberty”, this is sugar-water. I would be hard-pressed to think of a more frivolous and undeserving product to defend. In this country, we buckle our seat belts, refuse to lie under oath, pay our taxes, and abide by a number of other regulations so that we can preserve our truly important liberties. Dressing unhealthy portions of sugar-water up in the American flag should be taken as comical at best, and perhaps insulting.
    The soda companies behind the “grassroots” campaigns are pouring money into efforts to link bucket-sized soda portions and American ideals, and the companies are doing so from a purely profit-based standpoint. If they really cared about consumers rights to drink whatever and wherever they pleased, the same soda companies should be fighting the movie theaters to allow in outside drinks. But they are not. The soda companies choose to fight size-restrictions because they know what the public health experts know: size restrictions will lead to people drinking less branded sugar-water. And less money will go to the soda companies.

  • Eric

    I did not see mention of the elimination of free refills. I also did not see mention of soda prices going down as a result of the reduced cup size.

  • cameo

    “They [McDonald's and the rest of the fast food industry] don’t want kids to grow up thinking 16 ounces is normal, because that means setting kids up for a lifetime of saner (and healthier) drinking habits.”
    Does anyone really truly believe this? How does this author know what industries “want”? Did she ask them in an interview? Did McDonalds describe a destructive agenda to her? Or is her opinion an obtuse insinuation? What is her motive in all this, I wonder? Book sales maybe?