The Hidden Cost
The trade-off between cost and quality is age old. But what if the true cost of something we do everyday, multiple times a day, was hidden. Highly processed food, manufactured using chemically synthesized ingredients and modern methods, is often viewed as a major technologic advancement. It brings cheap, safe, convenient and tasty products to the masses.
Cheap is the operative word. With the arrival of industrial monocropping1 in the 60s and 70s, the world has produced many more calories to feed billions more people at reasonably low prices.
Have food budgets actually been declining adjusting for inflation?
The chart below shows the dramatic decline in American’s food budgets since the 60s. The percent of disposable income spent on “Food at home” (i.e. groceries) for the average person has dropped from ~14% in 1960 to under 6% in 20222. That is a ~58% decline in grocery budgets for the average American — while calories consumed have increased3. This under-reported budget savings has freed up hundreds of billions of dollars for non-food consumer purchases and leisure activities. Is there a catch?
Note #1: I was so surprised by the chart that I spot checked a few items using public inflation data4. Like-for-like data only dates back to the early 80s but it corroborates the USDA data above.
Note #2: The widely reported5 food inflation spike observed during the 2020-23 pandemic years 1) has been much stickier for food out-of-home and 2) is still fairly small considering the overall budget drop in the last few decades.
Boiling the frog
Urban myth has it that a frog will jump out of boiling water but will get boiled alive if the water temperature gradually increases instead. Similarly, recent research on ultra-processed foods may explain why they gradually deteriorate our health6. The hypothesis is surprisingly simple, a diet high in ultra-processed foods7 leads people to feel less satiated and therefore consume more calories (versus eating fresh or less processed foods).
Are higher quality, less processed foods worth it?
Even if someone knew that certain foods are high quality (e.g. whole ingredients found in nature that are minimally processed) and lead to better health outcomes, they may be unwilling to sacrifice taste, price or convenience. Taste is king and many believe they are incapable of shifting their taste preferences. However, as I discussed in Taste is Personal, patience and modest shifts in our palate can gradually turn down the temperature of our boiling frog (read: chronic health conditions). Note this assumes there is a desire to adjust taste preferences.
A sudden shift in taste preferences (aka “diets”) is unlikely to be sustainable, even if they are a New Year’s resolution. For example, shifting from regularly consuming a KFC dinner of fried chicken and french fries (all ultra-processed) to a home cooked meal of organic chicken and broccoli will not be received well by your taste buds. On average, the former will cost about $7.50 while the latter will cost about $11, or about a 50% increase. Even if someone began to appreciate the taste of high-quality chicken (vs chicken “flavor” pumped into KFC’s birds), will they be able to stomach the higher cost? Taste aside, my sense is the vast majority of Americans today do not believe the incremental benefits of the higher quality meal outweigh the incremental costs.
Can the typical American afford higher-quality food?
The median American household has a after-tax income of approximately $64,0008. Per the chart above, this means that the median household is spending approximately $70 per week on food at home and $70 per week on food out of home for a total of approximately $140.
A 50% increase in spending on food at home equates to 3% more of the median American’s after-tax earnings. Finding a way to save 3 percentage points (~$35 per week) from the 88% of the budget for non-food items ($1,080 per week) does not feel heroic provided that the benefits of this premium are palpable.
Does lowering food costs increase healthcare costs?
What percent of Americans would select food as a reason for the dramatic increase in Type 2 diabetes9 and other chronic health conditions in the last thirty years? I wish someone did this survey across a wide population spectrum as I would love to be proven wrong. While ‘food as medicine’ is a term used by coastal elites (I suppose I fall in that bucket), I suspect that most consumers do not readily equate food and beverage choices with health outcomes.
While foods costs have declined somewhere between 20-40% in the last 40 years adjusted for inflation, per capita healthcare costs have risen over 260%, adjusted for inflation.
I am not necessarily claiming a causal link but I believe the trade off between lower food costs and higher healthcare spending deserves more discussion. It is also worth noting that, during this time, exercise has been steadily increasing for the average American as I discussed in Too Much Cardio?
Why is food processed?
Humans have been processing food in some way since the dawn of cooking (or fermenting). Whether it is beer, wine, olive oil, or bread, there is long and rich cultural history of shaping foods and beverages to sustain and delight us. More recently, Carlos Monteiro, an esteemed researcher at the University of São Paolo, makes a clear distinction on processed versus ultra-proceed foods. Ultra-processed food undergoes such a major change in the underlying molecular structure that our bodies (particularly, our all important microbiomes) no longer recognize it as satiating food. Hence, we eat more food when it is ultra-processed, all else being equal10.
Ultra-processing dramatically lowers the cost of food by preventing rot for long periods of time. In other worlds, the food is “shelf-stable” or is capable of being frozen with varying levels of freezing / thawing when shipped over long distances. Ultra-processed ingredients11 are also typically cheaper than naturally occurring compounds since they are chemically produced at scale versus organic naturally occurring ingredients that typically need to be harvested in smaller amounts. For example, there is no reason that palm oil needs to be in peanut butter other than the fact that palm oil is cheaper than peanut butter — so mixing in 5-10% palm oil to 90-95% peanut butter lowers the cost and consumers don’t notice a difference in taste.
Finding balance with ultra-processed food
I believe it is unrealistic to think that the world on average will dramatically lower its consumption of ultra-processed food given the obvious benefits related to cost, convenience and, of course, flavor. However, I sense we are on the precipice of a better understanding the health tradeoffs in order to experience said benefits. Personally, I strive for a balance that reflects my daily circumstances (e.g. being at home versus traveling12) and meal time constraints (e.g. do I have time to cook / prepare a meal).
What does success look like?
Two simple measures of health outcomes are life expectancy and all-cause mortality. Over the last 40 years, the US has made meaningfully fewer gains on both metrics versus a basket of comparable countries.
When the average US consumer gradually begins to connect the quality of their inputs (e.g. food, beverage, and personal care products) with their long-term outputs (health), I believe an important realization will occur. Food budgets will likely need to increase at the expense of other more discretionary items. As this change occurs, decades of hidden costs in our food system may begin to dissipate. I am sure many will be unconvinced by this tradeoff. Taste is personal!
The process of growing a single crop, year after year, on the same land
See here and here the NIH research published in 2019. “This is the first study that shows causality: ultra-processed food causes people to consume calories and gain weight. If you remove those ultra-process foods and give them the same calories, they report liking the food just as much, yet they lose weight, and they eat fewer calories.”
Common examples would be soy / sunflower lecithin, xanthan gum, palm oil, high fructose corn syrup, any modified starch, etc
With a pinch of creativity, you can develop routines for travel. For example, I re-use a store-bought large clear plastic tub (initially containing leafy greens) as a salad container for long airplane meals (and then recycle once empty at the destination airport). A ziploc bag of nuts and chocolate chips for a snack or dessert.