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Thursday, March 05, 2009

why boycott coca cola

Coca Cola was invented in the United States in 1886 as a medicine, rather than a drink, to stimulate the brain and the nervous system, from a mixture of coca leaves and kola nuts, sweetened with sugar, hence the name Coca Cola. It was not until 1893 that Coca Cola was sold and promoted as a drink. Gradually the cocaine was eliminated, but in order to maintain the stimulant effect caffeine was substituted.

Phosphoric acid (0.055%) is now added to increase the fizziness and zingy taste. This gives the drink a pH of 2.8, making it almost as acidic as lemon juice (pH 2.2), which is why more sugar has to be added in order for it to taste sweet. Weak acidic solutions will dissolve the calcium in teeth over a period of time and will also interfere with calcium metabolism. This is especially of concern to post-menopausal women, who are already have a tendency towards osteoporosis.

Stimulants and sugar are habit forming, and Coca Cola contains large quantities of both. It is now sweetened with high fructose corn syrup. Fructose is a simple carbohydrate.

Carbohydrates are divided into two broad categories:

simple carbohydrates, e.g.


fructose (fruit sugar),

lactose (milk sugar),

sucrose (table sugar) etc.

complex carbohydrates, e.g.



High fructose corn syrup is produced by processing corn starch to yield glucose and then processing the glucose to produce a high proportion (80%) of fructose. This is not natural fructose, as found in fruit, since fruit usually contains 50% fructose, 50% glucose and is absorbed into the blood stream slowly, because the fruit also contains high levels of fibre. The fructose in high fructose corn syrup is absorbed into the body rapidly and transformed into glucose by the liver. There is currently some concern surrounding the consumption of high levels of fructose because it seems to interfere with copper metabolism and with the formation of collagen and elastin, essential components of the growing body.

When we eat (or drink) a high dose of sugar (sucrose, glucose or fructose) our blood glucose level rises suddenly, producing a feeling of elation. However high blood glucose levels also stimulate the pancreas to release insulin, which causes the glucose to be removed from the blood stream and converted into fat. This results in low blood sugar, low energy, irritability and low mood. At this point, we crave the feeling of elation associated with the sugar. This is why soft drinks are habit forming.

When, on the other hand, we eat complex carbohydrates, such as potatoes, bread, pasta, rice etc., the body breaks down these complex molecules gradually, over a period of several hours, into molecules of glucose. This glucose is released into the blood stream gradually, thus maintaining blood glucose at the level required by the body and brain for proper functioning.

Putting high quantities of sugar into drinks is an insidious way of introducing calories into people. People eating a chocolate bar are aware that they are consuming something fattening. People, especially children, consuming the same amount of calories in a drink are not. Regular consumption of drinks containing high levels of sugar lead to a gradual build up of stored fat and contribute to the rising levels of obesity in the West. Over-consumption of sugar causes over-stimulation of the pancreas. Over a period of many years, the pancreas loses its ability to produce adequate quantities of insulin. This leads to late-onset diabetes. Levels of late-onset diabetes have been rising steadily in the West over the past century.

Coca Cola, one of the world’s largest corporations, worth about ninety five billion dollars, owes much of its success to the massive marketing and advertising used to promote the product. It became a corporation early in the twentieth century and immediately began an aggressive advertising campaign throughout the US . The corporation used some advertising techniques of dubious morality, including funding the American Academy of Paediatric Dentistry and suppressing a World Health Organisation Report on healthy eating. The report stated that soft drink consumption contributed to obesity. But possibly the policy which caused the most public outrage was that of paying schools to sell Coca Cola in vending machines. The corporation realised that if they could sell Coca Cola to children, by the time they finished school they would become confirmed Coca Cola drinkers and would continue to buy the drink for the rest of their lives. This strategy was so successful that Coca Cola rapidly became the most popular drink in the US .

Long before the US market had become saturated, the corporation decided to target the next place with money to spend on drinks, i.e. Europe , where they now sell thirty percent of their product. Vending machines in schools soon became common place, despite opposition from concerned parents and teachers. Under-funded state schools found it difficult to refuse the money offered by Coca Cola.

The imposition of permanent advertising in schools, in the form of vending machines, certainly justifies a boycott, and indeed some schools have organised them, in protest against the Corporation’s monopoly of products sold in school vending machines. Groups at Universities in the US and the UK are also running boycotts in protest against Coke’s human rights abuses. Berkeley , New York University, Harvard, Yale, Rutgers , Macalister and University College Dublin all have ongoing boycotts.

Coca Cola has a history of human rights abuse. “It is a fact that the soft drinks giant from Atlanta , Georgia collaborated with the Nazi-regime throughout its reign from 1933 – 1945 and sold countless millions of bottled beverages to Hitler’s Germany .” From Coca-Cola Goes to War, Jones E and Ritzman F.

While the corporation, back in the USA , was promoting Coca Cola as a morale booster for the US troops, their German representative, Max Keith was sponsoring Nazi events, including the 1936 Olympics and situating advertisements close to Nazi leaders at rallies. Sales of Coke in Germany went from zero in 1929 to 4 million cases in 1939. Coke became the most popular drink in Germany and in 1944 the company sold 2 million cases. When the Nazis began their invasions of Italy , France , Holland , Luxembourg , Belgium and Norway Walter Oppenhof, Coca Cola’s German company lawyer, and Max Keith were employed by the Nazis’ Office of Enemy Property. They travelled with Nazi troops and were responsible for setting up Nazi Coca-Cola factories in expropriated soft drinks plants in countries occupied by the Nazis. They staffed these factories with kidnapped civilians. (See: ).

But Coca Cola’s association with fascist regimes is not confined to world war history.

In the 1970s workers at Coca Cola bottling factories in Guatemala were killed, in the 1980s Coke supported the Apartheid system in South Africa and in the 1990s they supported the brutal Abacha regime in Nigeria .

Currently SINAL TRAINAL, the Colombian workers’ union is promoting a world wide boycott in order to raise awareness of the intimidation, torture, kidnapping, illegal detention and murder of workers in the Coca Cola bottling plants in Colombia .

On the other side of the world, in several South Indian states, including Kerala and Tamil Nadu, boycotts have been running for years, despite police repression, in protest against Coca Cola’s excessive water consumption, pollution of local wells and destruction of agriculture. The Corporation’s bottling factories have been pumping water from boreholes at such a rate that they have dried up the underground aquifers. They have also been distributing the sludge produced by the factory as fertilizer. It is true that this sludge does contain substances which fertilize the soil, but Exeter University analysed it for the Kerala Pollution Control Board and found that it contained dangerously high levels of toxic metals, including cadmium. These toxic metals leach into the ground water and are taken up by crops and therefore ingested by the local population. After the BBC aired a programme about this, Coca Cola was forced to stop dumping their toxic waste on the local population, but nothing was done to clean up the already polluted environment. The protest and boycott in India continue.

The Coca Cola Corporation owns four of the world’s most popular five soft drinks: Coca Cola, diet Coke, Fanta and Sprite.

Over the past five years, Coca Cola Corporation has realised that, as water resources dwindle worldwide, even more money can be made from selling bottled water. Their sales of water are growing exponentially. Brands include Bonaqua, Dasani (US) Kinley ( India ), Mount Franklin ( Australia ) Malvern (UK) and Ciel ( Mexico ), but soft drinks still account for 85% of their market (at the moment). They plan to expand massively in the bottled water market but most of their advertising will go into promotion of soft drinks. Soon Coca Cola, Pepsi and Nestle will be the three main corporations selling bottled water, an iniquitous market, often depriving people of their local source of spring water, and selling it back to them at unaffordable prices.

Max Keiser, investment activist, has formed a partnership to target Coca Cola by bringing down the value of its shares. Keiser has developed a system for measuring a corporation’s vulnerability to a boycott. He calls it the Karmabanque (KbQ) Index. The KbQ index 2004 tracks the share price of high-performing but socially and environmentally irresponsible corporations, assuming their shares had been sold short on the 1 January 2004 . A short sale is a bet that a trader makes that a company’s share price will fall. The further the company’s share price falls, the more money the trader makes. Selling short stocks hurts corporations because it deflates their share price. The KbQ rating determines where a company appears in the index, and combines the amount of dissent directed at a company and its boycott vulnerability ratio (BVR). A company’s BVR indicates how susceptible its stock price is to a consumer boycott. In order to work out a corporation’s vulnerability, its market capitalization should be divided by trailing annual sales. Currently, ExxonMobil’s BVR is close to $1, whereas Coca-Cola’s is closer to $5. In other words the Coca Cola Corporation is five times more vulnerable to a boycott than ExxonMobil.

Coca Cola’s appalling human rights record, combined with its high boycott vulnerability ratio make it the ideal target for a boycott. This is why Max Keiser has decided to launch a hedge fund, which will be used to buy Coca Cola shares. They will then sell the shares for less than they bought them for, which will bring down their value on the international stock market. They are relying on the continuing boycott of Coca Cola products to bring the share price down still further. They will then buy the shares at a lower price than they sold them for and sell them again for even less. All profits from this venture will be donated to the victims of Coca Cola in countries such as India and Colombia .

Max Keiser says that for every 1,000 new boycotters, they will increase the size of the hedge fund by £5000. Keiser recommends that pressure groups like Greenpeace and Friends of the Earth should decide what to boycott according to their Boycott Vulnerability Ratio.

There has been a history of Coca Cola boycotts in many parts of the world. But this is the first time that an investor has become actively involved in a world wide Coca Cola boycott. Max Keiser deserve our support. There is every reason to hope that they will succeed in bringing down the market value of Coca Cola, but for that they need more people and organisations to join the boycott. / -