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How would a soda tax affect Big Gulps?

7-Eleven’s Big Gulps and Super Big Gulps are one of the great things about America. And judging by the number of hits this site gets from people searching for information about them, they are something that Americans—or the small subset of Americans who wind up visiting this blog—really care about.

Of course the great thing about the Big Gulp is the, shall we say, visionary sizes it comes in. The Big Gulp itself is 32-oz, the  Super Big Gulp is 44-oz, the Double Gulp weighs in at an impressive 64-oz (2 l), and for the truly thirsty there is the 128-oz Team Gulp. (I’ve never seen a Team Gulp myself, but Wikipedia says it exists.) The Big Gulp line serves up soda in such massive quantities that they almost make free refills unnecessary. Of course for those patrons for whom 44-oz is not enough, most 7-Elevens offer reasonable 79 cent refills if you bring your cup back. They don’t offer free refills as they are a convenience store, and who stands around in a 7-Eleven and drinks 44-oz of soda?

But of course the Big Gulp’s very strength—its vast size—is also its weakness when it comes to the soda tax.

As Philadelphia’s proposed soda tax is written, merchants would have to pay a tax of 18 cents-per-ounce of soda syrup. Most soda mixtures call for one part syrup for every five parts of water. Here is what you’d pay in taxes on a typical Gulp product (assuming you didn’t use any ice).

Big Gulp: 32-oz, Taxes: $1.15

Super Big Gulp: 44-oz, Taxes: $1.59

Double Gulp: 64-oz, Taxes: $2.30

Team Gulp: 128-oz, Taxes: $4.61

So if passed, the Philadelphia soda tax would more or less double the price of Big Gulps and other Gulp products. And it would probably mean the end of the 79 cent refills—just as it would likely end free refills in restaurants.

What is more American: Big Gulps or Credit Cards?

The US Capital
Big Gulps and using your credit card for everything are two pillars of the American way of life.  But a story in today’s New York Times reports that the companies that brought you the Big Gulp and promulgated no-fee (to the consumer) credit cards are at loggerheads.

At issue: interchange fees.

If you’re a regular reader of Free Refills & Why I Love America, you’ll know that what makes using a credit card in America such a pleasure is that retailers are not allowed to charge customers fees for using them or impose minimum purchase requirements on consumers who pay with them—although many of the merchants in NYC seem to be a bit casual about the latter.

The fact that credit cards are treated like cash liberates consumers from the burden of carrying cash and from the stealth tax of losing money that falls out of your pocket. What’s more, purchases made by credit cards often come with extended warrantees, insurance and customer satisfaction protections that are not available to those paying cash.

From the merchants prospective, the proliferation of credit card wielding consumers means that many more people can purchase things that perhaps they could not otherwise afford, earning the merchant a grateful customer and a handsome profit. For this benefit, the merchant has to pay an “interchange fee” of about 1-3 percent. That fee is divided up between the merchant’s bank, the card issuer’s bank and the good men and women at VISA, American Express and MasterCard who make the whole thing possible.

For cutesy video about how interchange fees work, check out this clip from the electronic payments coalition. They are the lobbying group for credit card issuers, so they should have a good idea how the whole system works.

Recently, many merchants have been scoffing at paying their fair share to make the whole system work. They have been violating their contracts by instituting minimum purchase requirements, charging customers extra fees and lobbying congress to change the rules on their behalf.

That is where 7-Eleven enters the picture. The people that brought us the Super Big Gulp are circulating petitions at some of their stores that urge congress to regulate interchange fees—in effect shifting the burden of those fees on to banks and consumers (in the form of decreased rewards programs).

Normally figuring out who to support in this case would be pretty easy. Using a credit card anywhere, to buy anything is part of what makes America great.

But on the other hand, the good people at 7-Eleven developed the Slurpee and the Super Big Gulp. How can a company that invented the bucket-sized soft drink and paved the way towards Super Size culture be anti American?

Who is more patriotic, the credit card companies or 7-Eleven?

In this instance, I am going to come down on the side of the credit card companies. Sure Super Big Gulps are great, and we will always be indebted to 7-Eleven for their relentless push towards bigger and bigger soft drink servings, but using a credit card for any purchase, even a Big Gulp, is more important than any one company. The free use of credit cards has become a basic American right—and one that needs defending.

When it comes to the Credit Card Companies V. 7-Eleven, the Credit Card Companies win.

God Bless America!

Previous topics mentioned in this post:

An Open Letter to VISA

#6. Chargebacks and Credit Cards

#10. Super Big Gulp

#10. Super Big Gulp

Super big gulp

Europeans love human rights campaigns, especially if those campaigns are somehow related to ending hunger. That is all well and good. Few things, after all, are more tragic than hunger.

But as any traveler who has been to Europe can confirm, Europeans completely ignore the logical companion of such programs: ending thirst.

I don’t mean to suggest that Europeans don’t care about providing drinking water in drought stricken nations. In fact, I’m quite sure that Europeans have more zeal than most when it comes to third-world well-drilling schemes.

No, what I am suggesting is that Europeans don’t care about ending thirst in their own back yard.

Europe is a land where the provision to tourists of even the most basic human need, water, is a for-profit scheme. Feeling parched after a long day of sightseeing? Get in line and pay 2 or 3 bucks for 12 oz of water. Even if you sit down at a restaurant, bottled, often carbonated, water is all that’s available – and you better not want ice with that.

But in America, you don’t have to worry about going thirsty. At restaurants, we’ve got free water and free refills, and for those who are both thirsty and on-the-go, we’ve invented the Super Big Gulp.

What is the Super Big Gulp? It is 64 oz of your favorite soft drink served in a cup-holder-ready plastic container and sold at a reasonable price.

So if you’re jacked up on trucker caffeine pills and planning on driving non-stop as far as your tank of gas will take you, never fear. For a buck or two, the great men and women of the 7-Eleven corporation will sell you enough of your favorite soft drink to ensure you don’t face the prospect of an empty cup for your entire journey (the prospect of a full bladder is another matter entirely).

But despite its clear utility, the Super Big Gulp has some detractors.

There are those that think the prospect of consuming 64 oz (630+ Calories) of one’s favorite soft drink is excessive or unhealthy. But they don’t understand that America is about freedom from want – and that includes freedom from wanting more to drink.

Besides, I doubt any of the naysayers have ever gone thirsty in a hostile environment like Europe.

God Bless America!

*For those who find the Super Big Gulp insufficient, 7-Eleven has developed the (2L) Double Gulp.


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