A friend of mine was complaining today about how healthy food is more expensive than unhealthy food, and implied that we wouldn’t have an obesity epidemic if things were the other way around. The suggestion is that people choose to eat unhealthy food because it’s the cheaper option; they would eat more healthily if that were cheaper instead.
That may be true to an extent, but it’s a chicken-and-egg scenario: a major reason that unhealthy food is cheap, is that it’s so popular. It’s a huge market, so producers, suppliers and retailers compete fiercely on price to get a portion of it. Also, because the market is so large, they can achieve economies of scale in the production of bad food.
On the other hand, healthy food is a much smaller market, so it’s more expensive to produce. It’s not worth it for retailers to make such big price cuts to increase their market share. And, they know that the people who buy healthier foods are conscientious consumers who have sought out those products for their healthy qualities, and are therefore willing to pay a premium. The result is that it makes basic economic sense for the food industry to continue charging higher prices for healthier food.
There are other factors too, external to the feedback loop of demand and low prices. Unhealthy food is generally bad because it contains a lot of fat, salt and/or sugar – ingredients which producers put into processed foods in large quantities precisely because they hit the pleasure centres in our brains and enhance our craving for more of that food type. They’re also very cheap ingredients, so for a manufacturer of processed foods, they’re an extremely cost effective option: he can increase customer satisfaction, and sell more of his product, while keeping the production cost low.
Also, the healthiest food is that which you cook yourself from fresh ingredients. That’s inherently less convenient than buying processed food and ready meals, which the producers stuff with fat, salt and sugar, to make it taste better and for preservation. Customers want convenience, and the majority opt for it. Those who’d rather have the healthy, less convenient lifestyle are in the minority, and so less interesting to retailers.
The demand for unhealthy food, therefore, is perpetuated by its taste and its convenience, as well as its cost; and its cost is low by its nature, and pushed down further by the competition driven by mass demand.
I actually wouldn’t be surprised if the margins made on the really expensive premium healthy ranges, sold to the discerning health-conscious consumers, were used to subside further discounting of the fatty, sugary pigswill sold to everyone else.
This isn’t going to change of its own accord. The economic reality, based on broad customer behaviour, overwhelmingly encourages the food industry to produce unhealthy food on large scales and sell it cheaply, while letting the prices of healthy food remain high. It’s no use appealing to the good nature of the producers to do anything different: as an industry they can only be expected to follow the most profitable path. I doubt trying to change consumers’ attitudes will have much effect either: several decades’ worth of information, advice and campaigning on healthy eating have created only a minority of people motivated enough to change their lifestyles accordingly. The vast majority will still choose the option that gives them taste, convenience and low food bills in the present, even though it’ll also give them heart disease, diabetes and cancer in the future.
If we really want to do something about this, the only effective way is to change the economic situation for food producers by regulation and taxation. Here’s an outrageous idea: introduce a VAT supplement for food. The rate is equal to the combined percentage of fat, salt and sugar in the product. Now producers have a financial incentive to keep those levels down, and consumers are nudged by pricing towards better choices. Fresh fruit and vegetables, lean meat and fish, and healthier carbohydrate options like couscous and rice, are suddenly the cheapest options in the shop.
The system could be developed and improved. Distinguish between different types of fat according to their level of toxicity. Add other ingredients to the tax calculation as research proves them to be unhealthy. Give an extra weighting to substances like salt, which have a disproportionately harmful effect in smaller quantities. The potential is enormous: we could construct a sophisticated economic system which tailors the nation’s eating habits towards a healthy ideal. The immediate tax revenue would pay for the organisation responsible for reviewing and updating the system, with surplus; in future decades, the savings in healthcare would be dramatic.
The food industry will fight it at first, but since they’ll all have to follow the same rules, they won’t be disadvantaged. There should be no concerns from a liberties perspective, since people will still have a free choice of foods. And the moral, social and economic arguments are impelling. Is it really such an outrageous idea after all?