Is Healthy Eating Just For The Rich?

Topic: Pearls of Wisdom

John C.A. Stevenson CFA

October 26, 2016

Image used with permission: iStock/RomarioIen


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Is Healthy Eating Just For The Rich?

Such is the title of an interesting research piece published by U.S. investment dealer, Sanford Bernstein, over the summer. Bernstein analyst, Alexia Howard, points out that diet is one more symptom of the growing economic divide within many developed countries. While interest in healthy eating is growing most rapidly among the middle class, lower income households are being left behind.

According to the American Medical Association, over 60% of low income Americans eat poorly, whereas fewer than 40% of more affluent consumers do. Much of the reason boils down to affordability. Junk foods cost just $1.76 per 1,000 calories on average, while fresh fruit and vegetables cost over 10 times as much — $18.16 per 1,000 calories. Low income households often can’t fit the healthy stuff into their weekly budget.

U.S. agricultural policy since the 1930’s also has contributed to the problem. Financial assistance has been widely available to farmers who grow corn, wheat and soybeans, but not to those who grow fruit and vegetables. As a result, only 14 million of the 300 million acres of U.S. farmland are planted with fruits and vegetables. It is estimated that U.S. farmers would need to double this output for Americans to meet the most basic minimum daily requirement of fruit and vegetables set by the USDA. In recent years, the USDA has recognized the problem and tried to encourage more fruit and vegetable farming. However, the incumbents have resisted, as they are loath to have additional production push prices lower in what has become a pretty protected and lucrative market.

Howard also points out that it is not simply the price of a bunch of carrots that makes healthy eating difficult for low income households. Fresh fruits and vegetables go bad and a box of Kraft Dinner does not. Moreover, kids typically need to be presented with a new food between eight and 15 times before they will like it. Modest families who struggle with the initial purchase price surely cannot handle the waste.

Much has been written about the health epidemic in many developed countries that derives from the excessive consumption of processed foods. Given the financial challenges of putting healthy options on the plates of low income households, there may be no easy solution.

Source: Alexia Howard, Sanford Bernstein, “Is Healthy Eating Just For the Rich?”, July 29, 2016

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