Have you ever wondered why healthy food choices are more expensive than unhealthy ones? Obesity is not just an individual problem; it actually cost the country over $100 billion a year in healthcare costs.
An understandable answer to that question would be that it is cheaper to produce unhealthy food than it is to produce healthier options. Unsurprisingly, that would be correct. However, what might surprise you is that one of the reasons unhealthy food is cheaper to produce is because the federal government helps keep it that way.
By definition, subsidies are financial assistance from the government to help facilitate something. The basic idea is that if you can make it a certain financial distance, the government will get you to the finish line, or at least move it closer.
In practice, however, subsidies usually end up being financial incentives to do a certain thing a certain way. In manufacturing, it would be something like “We need more of part A than part B. So, anyone who makes part A gets X amount of money.” Or, “Anyone who makes part A won’t have to pay taxes on it.”
In theory, they serve a practical and useful function. Subsidies are supposed to guide assets where they are most needed for the benefit of the country at large.
As with most things, intentions, design, and theory don’t always line up with reality. In reality, subsidies often help to make rich industries richer by driving down production costs for profit.
This could be an article all to itself. I’ll keep the definition brief and to the points of relevance to what I’m already talking about.
As it turns out, it’s super illegal for politicians to accept money for favors. In order to get around those pesky bribery and ethics violation charges, industries have to be more creative in how they gain the favor of elected officials.
That’s where Lobbies come in. They are a well-funded branch of most industries that will try to persuade politicians to make policy changes that are favorable for them. This can come in the form of campaign contributions, trips, and just straight up money if they can do it sneakily enough.
As you might guess, the lobbies with the most money tend to be “friends” with the most politicians and get the best policies.
Bringing It All Together
Sugar, corn, and soy have some of the strongest lobbies in the country. Wouldn’t you know it? Sugar, corn, and soy are some of the most subsidized foods in the country. Granted, they aren’t inherently unhealthy (sugar, arguably notwithstanding), but they are overwhelmingly used for the most unhealthy products; namely junk food. Moreover, they aren’t in the financial demand that such subsidies are designed for.
However, since they do get the subsidies, more farmers plant them, more refineries refine them, more companies use them in their products and more stores sell them. It’s all because production costs are low and profits are high, thanks to your own tax dollars. The government is using your money to make unhealthy food cheaper than healthier fare. If you’re not pumped about that, there is an election next week. But honestly, both sides are to blame on this one.