Philadelphia鈥檚 Soda Tax Shows Promise As Allocations for Pre-K Outperform Expectations
In 2016, when Philadelphia became the first big U.S. city to tax sugary beverages, many expected other others to follow. , but a favorable recently published by the National Institute for Early Education Research (NIEER) could revive the issue. I spoke to Michael Lahr, director of the ) and lead author of the report to find out more.
A significant portion of the proceeds from the 1.5 cents per ounce tax is allotted for the city鈥檚 pre-kindergarten system. The boost in pre-K funding not only expands early learning but also frees up parents鈥攅specially in low-income families鈥攖o enter the labor force. (In order to qualify for a subsidized pre-K slot, parents must either have jobs or be taking courses.) A on the report trumpeted the creation of 800 to 1,350 jobs. A good number of those jobs are in the child care sector at a time when this workforce is experiencing shortages all over the country.
鈥淚t鈥檚 a genius idea,鈥 Lahr said. 鈥淚 wish I鈥檇 thought of it.鈥
Lahr and his co-authors expected the tax to generate $29.8 million for pre-K along the lines of Philadelphia鈥檚 spending for FY 2019, but as it turns out, the allocation hit $38.1 million in 2020, despite lower revenues from the tax. 鈥淲hile the results are mixed in smaller, car-based, low-density cities like Boulder and Berkeley, it鈥檚 working like a charm in Philadelphia,鈥 he says.
That鈥檚 not to say that the tax benefits everyone equally. This is an inherent issue with any tax policy: there are winners and losers. 鈥淣ot everything we reported was rosy,鈥 Lahr explains. 鈥淥ur analysis noted that job losses were clearly experienced by producers and wholesalers of sugary beverages as well as by truckers.鈥
Lahr allows that the gaps in child care in America鈥檚 cities might be better addressed through federal policy, but until Congress shows the political will to invest more robustly, solutions like Philadelphia鈥檚 might be worth imitating. Furthermore, although he notes that quality of pre-K programs does not come into the scope of his NIEER analysis, he envisions possible ways that the program might be enhanced to address the issue. For example, the city could more narrowly identify specific education and training programs for which the pre-K parents could qualify. It could target education programs and occupational training for jobs in which there is a relative scarcity of workers. It could also use the subsidy to improve the child care system through minimum established requirements or user rating along the lines of Yelp. He also notes that some regions of the U.S. could reform zoning laws to promote an increase of child care options.
鈥淎 more important question,鈥 Lahr explains, 鈥渋s 鈥楬ow can we assure that proper child care is delivered when child care is subsidized?鈥欌 He proposes that more funding for professionalization within the child care workforce would increase wages, training and support鈥攁dding that such measures would naturally raise the cost of child care, 鈥渨hich as the paper notes is also a core problem.鈥
Tax policy can be a frustrating topic to discuss because wherever there鈥檚 a controversy, experts on every side turn up with studies and charts to support their interests. Soda taxes, in particular, have been attacked by libertarians as a 鈥渘anny state鈥 intervention in the freedom to consume sugar, by business interests for interfering with the market and even by some liberals as regressive鈥攊n other words, for imposing a heavier burden on those at the bottom of the economic ladder. In spite of inflammatory rhetoric, the evidence points to a distinct, though hardly radical, success at achieving the intended goals. found soda taxes relatively effective at targeting the sugar intake of the young, less successful at targeting the intake of those with high total dietary sugar and unlikely to be strongly regressive.
The controversy demonstrates that these issues matter, even at the rate of 1.5 cents per ounce. Taxes express values鈥攊n favor of home ownership or solar panels, for instance鈥攁nd not taxing soda would be as much of an expression of a city鈥檚 values and priorities as taxing soda. The Philadelphia soda tax expresses a belief in early education. 鈥淭he city wins in the long haul,鈥 Lahr says, 鈥渁s the parents of these children will at a minimum be better equipped to hold a job if they are not getting them now.鈥
This story originally published on Early Learning Nation and is now archived on 蜜桃影视. Learn more here.