Liberate the soybean farmers!

The American Soybean Association (ASA) this week slammed Senator Jim DeMint (R-SC) for proposing that checkoff contributions should be voluntary.

At present, the checkoff programs use the federal government's power of taxation to collect hundreds of millions of dollars each year in mandatory assessments from producers -- whether the producers want to contribute or not -- to be spent on advertising, marketing, research, and plenty of overhead.

The checkoff programs were the focus of scrutiny by USDA's Inspector General, who determined in a March report (.pdf) that the Agricultural Marketing Service (AMS) "needs to improve its governance over the boards."  AMS took some steps in 2010 to increase oversight and plans to release more detail about procedures the boards should follow in the near future.  A key example in the report came from the soybean checkoff.  According to the Inspector General:

A recent OIG investigative review reported that a subcontractor of the USB [the soybean checkoff board], the United States Soybean Export Council, used subcontracts as a mechanism for paying employees unauthorized bonuses totaling approximately $302,000. The Council’s executives did not obtain authorization from the USB to pay the bonuses. 

The American Soybean Association's vociferous email this week is misleading on several points.

In the email, ASA President Steve Wellman said, “The checkoff is not a tax. It is not something that is imposed upon us as farmers. Rather, it allows farmers to invest our own dollars to conduct research, build markets and create new uses for soy.” I cannot figure out who Wellman thinks he is fooling, checkoff farmers or the general public? For farmers who choose not to contribute voluntarily, the checkoff payment is imposed. The U.S. Department of Justice enforces the mandatory assessments. Although the checkoff collections do not appear in the federal government's official tax accounts, that omission is itself a scandal. In plain English, the checkoff is a tax.

The ASA email continues, “With oversight provided by USDA, producers have taken it upon themselves to fund over $905 million of research, promotion and consumer education programs annually through checkoff activities at no cost to the federal government.” Is that really the number? $905 million?! The USDA Inspector General's report said the soybean oversight problems mentioned above contributed to the IG's concern that "oversight controls were not adequate to prevent or detect the potential misuse of funds."  I would not say that USDA oversight strengthens the case for a mandatory assessment.

Describing the IG report and the soybean checkoff problems in particular, syndicated agricultural policy columnist Alan Guebert wrote in April, "When federal auditors examine almost any aspect of the 18 checkoffs created by Congress, they usually find the worst of times: funds misspent on illegal travel, subcontracts used to funnel money for unauthorized bonuses, no procedures to track money and audit rules so porous that a checkoff-bought Sherman tank could clank through most checkoffs without a question or an eyebrow getting raised."

In DeMint's proposed amendment to the Farm Bill, checkoff contributions would be voluntary and would no longer be enforced by the federal government's power of taxation.  Imagine that! Like every other industry, farmers would be free to contribute or not contribute, as they prefer, to private-sector marketing efforts.

What ban?

Everybody seems to be saying that New York City Mayor Michael Bloomberg has proposed to ban sodas in containers larger than 16 ounces.

What ban?

My version: Bloomberg has proposed a cup-size restriction for selected soda sales in restaurants, movie theaters, and vending carts. 

You may agree or disagree with this proposed rule.  All I want to say is that trying out the rule has some merit.  There is a large literature showing that our brains mis-estimate the food energy content in large beverages, and our bodies physiologically mis-regulate liquid Calories.  Quite possibly, people will get as much -- maybe even more -- utility or satisfaction from a smaller cup.  Quite possibly, a smaller cup will be as profitable for NYC businesses.  Quite possibly, this rule offers a modest public health benefit at reasonably low cost in terms of money and personal well-being.  All of these possibilities are eminently testable.  I think it would be great to see NYC try out this policy on a pilot basis, and do a high-quality study showing the impact on health and economic outcomes.  Pursuing this pilot is a sober and sensible proposal.

If the pilot succeeds in promoting public health with few harmful side-effects for businesses and customer satisfaction, I would favor it.

I am not surprised that right-wing critics have gone all Defcon 1 about this proposal.  They say this proposal will cause a loss of liberty.  Puh-lease.  We are talking about the difference between a 12-oz and a 20-oz cup of soda in a movie theater.  We have a thousand personal liberties to worry about long before I will start to worry about the right to a particular soda cup size.

What really surprises me is that progressive supporters of the rule endorse the right-wing narrative about how this proposal will affect liberty.  What do I mean?  Consider Mark Bittman's column at the NYT this week:

On a more personal level, we hear things like, “if people want to be obese, that’s their prerogative.”Certainly. And if people want to ride motorcycles without helmets or smoke cigarettes that’s their prerogative, too. But it’s the nanny-state’s prerogative to protect the rest of us from their idiotic behavior....  To (loosely) paraphrase Oliver Wendell Holmes, your right to harm yourself stops when I have to pay for it. And just as we all pay for the ravages of smoking, we all pay for the harmful effects of Coke, Snapple and Gatorade.

In essense, Mark Bittman agrees with conservative critics that the cup-size rule is part of a broader agenda to forbid personal choices that could make us fat. Bittman says it is okay for the government to take away our liberty to make such choices, because we share the same insurance risk pools, so one person's medical costs affect another person's taxes and insurance premiums.

I don't think shared risk pools should give policy-makers the right to ignore personal choices cavalierly.  When describing sensible public policies that override personal choices, I would not toss in the term "nanny-state."  Unlike "Yankee Doodle" and "queer," there are poor prospects for converting "nanny-state" or "ban" from a term of insult to a term of praise.  A key feature of obesity policy is that many individuals themselves recognize that their short-term impulses are contradicting their own true long-term desires for health and satisfaction and good food and drink.  The NYC proposal may better serve the long-term desires of most people most of the time.

If this cup-size proposal really threatened important personal liberties, I would oppose it.

Why are this policy's supporters undermining its political prospects by making it out to be more than it is?  There is no ban.

POM Wonderful claims are false and misleading

An administrative judge for the Federal Trade Commission (FTC) concluded (.pdf) last week that POM Wonderful marketing claims about health benefits were "false and misleading."

For example, POM Wonderful advertisements imply that the juice protects against prostate cancer.  Could this be true?  POM Wonderful cited a study with some evidence that "PSA doubling time" -- a measure of prostate cancer's progress -- is slowed by drinking POM Wonderful.  Yet, truthfulness requires more than selective quotation from a favorable study.  In the FTC hearing, the balance of scientific evidence failed to support POM Wonderful's implied prostate cancer claim. 

POM Wonderful argued that some of its claims were merely puffery, not intended actually to convince grown-up consumers that the juice protects against cancer.  Yet, truthfulness does not permit the kindergarten defense: "Okay, I implied it, but I didn't really say it, so it's not a lie."

The administrative judge is correct to tar the claims as false and misleading.

What is the policy implication?  Some reasonable people would say the FTC should crack down on misleading health claims.  Other reasonable people would say "buyer beware," while maintaining that regulation will do little good.  In either case, let us all acknowledge that the claims are false and misleading.  There can be no defense of the claims themselves.

Or, so I thought.

POM Wonderful's response to the ruling this week has a breathtaking audacity.  I see today on the NYT website, POM Wonderful advertisements boasting of the FTC judge's ruling.  For the prostate issue above, here is the key quote in the POM Wonderful ad today:

“Competent and reliable scientific evidence supports the conclusion that the consumption of pomegranate juice and pomegranate extract supports prostate health, including by prolonging PSA doubling time in men with rising PSA after primary treatment for prostate cancer.”

– Judge Chappell, Chief Administrative Law Judge, FTC

In the Matter of POM Wonderful LLC, Initial Decision (5/17/2012), page 282

How is this possible?  Did the judge really endorse the very cancer-protective claim that POM Wonderful had implied?  Here is the full passage from page 282 of the judgment, with the sentences not quoted by POM Wonderful underlined.

Competent and reliable scientific evidence supports the conclusion that the consumption of pomegranate juice and pomegranate extract supports prostate health, including by prolonging PSA doubling time in men with rising PSA after primary treatment for prostate cancer.  However, the greater weight of the persuasive expert testimony shows that the evidence relied upon by Respondents is not adequate to substantiate claims that the POM Products treat, prevent, or reduce the risk of prostate cancer or that they are clinically proven to do so.  Indeed, the authors of the Pantuck Study and the Carducci Study each testified that their study did not conclude that POM Juice treats, prevents, or reduces the risk of prostate cancer.

Let anybody who was tempted to criticize the FTC or defend POM Wonderful read these two passages and evaluate for themselves the company's standard of honesty.

In my view, POM Wonderful is truly a bold titan of the dubious claims industry.

Update (1:45 pm): I just noticed that Marion Nestle also covered the NYT ads.  Soon perhaps POM Wonderful will quote Marion's sentence: "Fruit juices are healthy and especially delicious when fresh."  Of course, Marion goes on to say she doubts the cancer claims too.

SNAP benefits surpass 10% of all grocery spending

In 2010, for the first time, SNAP benefits appear to have surpassed 10% of all grocery spending.

This seems to me like a significant threshold.  The program formerly known as food stamps is not just an important part of the safety net.  It plays a big role in the U.S. retail economy more generally.  It should be a national priority to seek economic growth of the sort that reaches all the way to the low-wage labor market.  The last time we had that type of poverty-reducing economic growth for a sustained period was the late 1990s.

I provide more detail about recent program trends in "The New Normal: The Supplemental Nutrition Assistance Program (SNAP) (gated)," published this week in the American Journal of Agricultural Economics (AJAE).  The paper came out of a lively conference session, organized by Benjamin Senauer and including papers by himself and Mark Rosegrant, Mike Boehlje, Brent Gloy, Jason Henderson, and Tim Beatty.

This figure compares administrative data on SNAP benefits to USDA's two data series on aggregate food spending.  Depending on the measure of food spending used, SNAP now represents 10% to 17% of the food retail economy.

Figure 4.

Total SNAP benefits, as a percentage of food at-home sales in food stores and in total, 1981–2010

Author's computation based on USDA/FNS annual SNAP data (converted from fiscal year to calendar year by interpolation) and USDA/ERS annual national food spending data by calendar year.

Healthy food not more expensive

In contrast with the conventional wisdom that healthy food costs too much, USDA's Economic Research Service this week reports:

For all metrics except the price of food energy, the authors find that healthy foods cost less than less healthy foods (defined for this study as foods that are high in saturated fat, added sugar, and/or sodium, or that contribute little to meeting dietary recommendations).

The argument turns largely on three different methods of measuring the cost of food:

• price per unit of weight ($ / 100g of edible weight)
• price per serving ($ per cup or ounce equivalent)
• price per unit of food energy (cents per Calorie)

Based on the third method, people frequently say healthy food is too expensive.  Based mainly on the first two methods, USDA argues instead that healthy food is reasonably inexpensive.

You might think this is a delightfully arcane and nerdy point of contention.  Yet, the new study has major news coverage today, including a surprisingly complete explanation of this whole units issue.  The Wall Street Journal quotes one of the report's authors, my colleague Andi Carlson:

Often, less-healthy food options are made up of empty calories, prompting people to eat even more, said Andrea Carlson, lead researcher of the report.

"Take a chocolate glazed donut which is 240 calories," she said. "You can easily eat one, if not two or three without any trouble at all. However, a banana, which has a lot of nutrients in it and will make you feel quite full, has only 105 calories. You will feel fuller if you eat the banana versus the donut."

I can think of reasons to like each measurement method in certain circumstances.  Beverages provide an example of a comparison where it seems the per-serving approach is sensible.  If we compare the cost of milk to sugary soda, a per-Calorie comparison makes soda look cheaper when it really just has more Calories.  The per-serving comparison better captures the choice consumers really face.

On the other hand, if you think of the cost of a day's food supply, consumers' bodies generally regulate total food energy intake.  For such comparisons, perhaps price per unit of food energy does make some sense.

For those who want more detail, here is a summary graphic from the USDA report.  It is a bit complex.  Generally, the high-carbohydrate category is fairly inexpensive, which corroborates the conventional wisdom.  But, the fruit and vegetable categories are less expensive than meat by the preferred second and third measurement methods, which is USDA's main point.

Reuters: Washington soft on childhood obesity

From yesterday's long report by Duff Wilson and Janet Roberts at Reuters:

At every level of government, the food and beverage industries won fight after fight during the last decade. They have never lost a significant political battle in the United States despite mounting scientific evidence of the role of unhealthy food and children's marketing in obesity.

Lobbying records analyzed by Reuters reveal that the industries more than doubled their spending in Washington during the past three years. In the process, they largely dominated policymaking -- pledging voluntary action while defeating government proposals aimed at changing the nation's diet, dozens of interviews show.

How to read organic agriculture debates

The journal Nature (link may be gated) recently had an interesting meta-analysis -- or quantitative literature review -- about yields from organic agriculture.

The accompanying summary says, "conventional agriculture gives higher yields under most situations."  This is probably true.

Yet, even environmentalists are overreacting to the study.  A recent article by Bryan Walsh at Time Magazine's Ecocentric blog is titled, "Why Organic Agriculture May Not Be So Sustainable."

The evidence Walsh presents fails to support the headline, though the article does begin with two good points:

• Organic agriculture commonly has a yield penalty per unit of land (see the Nature article above).
• Environmentalists should care about efficiency.  Getting more output for lower resource cost is good environmentalism.

Mostly, though, Walsh repeats common overstatements of the advantages of conventional agriculture.  

Conventional industrial agriculture has become incredibly efficient on a simple land to food basis. Thanks to fertilizers, mechanization and irrigation, the each American farmer feeds over 155 people worldwide. 

Environmentalists discussing conventional agriculture should remember several key themes:

• Not all productive technology improves the environment.  Many technologies used in conventional agriculture are designed to save labor, not to save land.  In Walsh's quote above, huge mechanized combines elevate the number of people fed per American farmer, but they make little difference to yields per unit of land (the key environmental issue addressed by the Nature study).  From one sentence to the next, Walsh conflates food per American farmer with efficiency "on a simple land to food basis."
• Yield is not the same as efficiency.  Organic agriculture commonly requires a tradeoff, giving up some yield and undertaking some additional labor and management cost in order to gain something of value for the producer and for the environment.  Advocates for organic agriculture say the tradeoff is efficient -- getting the most output for the lowest resource cost when all environmental costs are accounted.  Walsh's first sentence boasts of the "efficiency" of industrial agriculture, but the following argument fails to support the boast.
• Producing more grain is not the same as feeding the world.  Any time the high yields of U.S. corn production are mentioned, it should be noted that most U.S. corn goes to ethanol and animal feed.  Walsh seems to think that Iowa corn farmers do well at feeding the most people possible for the least land, which is false.  If the goal is to feed the world, then most of the calories produced in Iowa corn fields are squandered already, and this loss matters more than the organic yield penalty matters.

Most hard-headed well-grounded advocates for organic agriculture already understand the yield tradeoffs, and they already value efficiency.  For example, Rodale studies over the years have always claimed that lower chemical input costs offset modest yield penalties -- a claim that may be nearly consistent the new Nature study.

One sometimes meets beginning organic farmers who are dismissive of yields and efficiency.  But one never meets an organic farmer who has been in business for five years and remains dismissive of yields and efficiency.

There is one lesson in this whole argument for organic advocates.  It is important to speak plainly about yield penalties and about efficiency.  Perhaps Walsh was not sufficiently familiar with hard-headed well-grounded research on organic practices, but instead may have been reading some excessively optimistic pro-organic public relations.  Then, when the PR message was contradicted by the Nature study, Walsh overreacted.  It is best all around to state the relative advantages of environmentally sound production practices plainly and precisely from the start.