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Food Prices in the U.S.:

I've heard a good deal of talk about rising food prices, but the data I've seen suggests that total food costs as a share of disposable income (i.e., after-tax income) are not substantially rising in the U.S.

The Consumer Price Index for food increased 4.0% in 2007, but total disposable personal income increased 5.7% in 2006, for a per capita increase of roughly 4.5%, taking into account the roughly 1.1% population growth rate. (Unless I'm mistaken, all these numbers are in nominal dollars, and thus are directly comparable.)

So the 2007 food price increase seems likely not to have changed the share of disposable income that goes to food. The likely 2008 increase, 4% to 5%, will likely have the same effect. Some press accounts point to large increases in prices for certain foods, such as milk and eggs. But the USDA data suggests that the overall increase -- which is what we should care about, unless we're in an unusually custard-consuming household -- is much more modest.

But let's even say that the prices increase in 2008 by 6%, and per capita disposable income increases only by 3%, so that the share of disposable income that goes to food rises by 3%. That would be an increase from 9.9% of disposable income (the 2006 share that's likely to remain stable for 2007) to 10.2%. For some perspective, here are the numbers on U.S. food spending as a fraction of disposable personal income in the past:

YearFood spending as share of disposable income
192923.4%
193921.3%
194922.1%
195917.8%
196913.7%
197913.4%
198910.9%
199910.2%
20009.9%
20019.9%
20029.8%
20039.8%
20049.7%
20059.8%
20069.9%

So an increase from 9.9% to 10.2% puts us at the 1999 level, which as I recall was quite bearable. Not a major change, it seems to me -- or is there something that I'm missing here?

Thoughtful (mail):
Custard! YUMMMM....

Damn!!
5.13.2008 4:40pm
Kazinski:
What you are missing of course, is the cost of gas to go to the grocery store.
5.13.2008 4:41pm
Alex B:
Two more years at that rate and we'll be back at the 1989 level. That wasn't bad. How far back would you be willing to regress?
5.13.2008 4:43pm
Tennessean (mail):
What you're missing, I gather, is the claim that food prices have grown dramatically in the very recent past, and that more of that same high level of growth is expected in the near future. From the article you linked:
[P]rices for staples such as bread, milk, eggs, and flour are rising sharply, surging in the past year at double-digit rates, according to the Labor Department. Milk prices, for example, increased 26 percent over the year. Egg prices jumped 40 percent.

If 'double-digit rates' means 10.0%, not too bad, but if food prices (especially for staples) are jumping 25% per year, that might be pretty bad.

I'm not vouching for the data in the article, but I think that is where your analysis is not tracking the voiced concern.
5.13.2008 4:46pm
rarango (mail):
At the risk of sounding, you know, like a republican wing nut, what you have missed is the meme that its the last days, the world is coming to an end, the worst economy since Herbert Hoover, gas prices are at an all time high, and housing foreclosures are rampant. Oh: Did I mention its an election year?

Food prices will continue to rise for the same reason as gas prices: Increased world-wide demand caused by the Chinese and Indian economies cranking up, and some pretty bad weather hits last year (and we won't even mention ethanol and biofuels from the US Congress. Fortunately, despite the best efforts of our politicians, markets continue to work, and supplies will adjust, albeit at a somewhat higher cost. Ultimately, I think it's called supply and demand. We should count ourselves lucky to live in an economy where food is so relatively cheap.
5.13.2008 4:46pm
Frog Leg (mail):
What you're really missing is that this comparison between food prices and aggregate disposable income obscures the fact that the average (which is directly derivative from aggregate number) has risen much faster than the median(which has no general relation to aggregate numbers). A much more meaningful comparison would be food prices to median disposable income.
5.13.2008 4:47pm
Baronger:
But is it an apples and oranges comparison.

That is they might be spending the same amount, but buying more hamburger and less steaks.

More beans less meat.
5.13.2008 4:47pm
J. F. Thomas (mail):
What you are missing is the rise in median income rather than total disposable income. If most of the rise in total disposable income goes to very few people, then it is a meaningless statistic. As far as I know, incomes of ordinary people are not keeping pace with inflation because salaries are not rising fast enough to cover the increased cost of food and gas.
5.13.2008 4:49pm
Buckland (mail):
Amy Brnger, 43, of Portsmouth, N.H., just needs to look at her grocery receipts. For a long time, feeding her family of three used to cost around $125 a week. Suddenly this winter, her bill leaped to about $200.


That's one heck of a jump on a 4-5% increase.
5.13.2008 4:51pm
EIDE_Interface (mail):
JF Thomas - you're always contrarian to anything posted on this blog. Wouldn't you be happier on Kos where you agree with them 100%?
5.13.2008 4:53pm
rarango (mail):
Let me suggest that a better indication would be the nutritional value that disposible income could buy. You can buy ground beef or you can buy ground turkey. Lots of substitutions can be made in one's diet and at a lot lower cost. Start looking at what a dollar can buy in terms of nutritional value. We are doing just fine, I suspect.
5.13.2008 4:53pm
Mike S.:
On the other hand, per capita daily food consumption rose from 3300 kcal to 4000 kcal between 1970 and 2000, thus contributing to an increase in fat. This suggests that it might be a good thing if Americans responded to higher food prices by buying and, presumably, eating less.
5.13.2008 4:54pm
EIDE_Interface (mail):
Buckland:

How do we know it's the same shopping list? I can't believe her bill increased 60% on the same items. I know mine hasn't increased more then 10%.
5.13.2008 4:55pm
AndrewK (mail):
Alex B, despite the sarcasm, demonstrates a good point. What matters isn't the actual real price--- what matters is the perception. For consumers like Alex B, inflation coupled with corresponding wage increases lead to "inexplicable" price increases that make them mad. You make a good case that food costs are substantively similar, but nominal food prices are rising, and this makes people like Alex B nervous. We're used to a certain nominal price of milk, and when it increases, we get cross.

It's neat to see that for the past 8 years we've been stable around 10%... I also wonder what rate of increase of [% of wage accounted for by food costs] people generally tolerate. At a rate of 1% change per year, do people internalize these costs? At a rate of 2% per year, do they start to change their habits?
5.13.2008 4:55pm
AndrewK (mail):
rarango was posing as I was typing, and makes the point I was trying to make in my second paragraph. Are people buying cheaper food now, or are their habits the same? I think that would have a bearing on the stability of the ratio.
5.13.2008 4:58pm
Bo:
People respond angrily to prices increasing, especially if compared to wages and income that could be flattening.

People don't respond as much when food prices decrease -- it isn't as likely they suddenly buy -much- more milk when the price drops from a long-term equilibrium. One probably tends to buy a more quantity-concerned basket of food, as opposed to one that is price-oriented (except on the margin, say, buying cheaper meat compared to more expensive cuts).
5.13.2008 4:59pm
JoshL (mail):

On the other hand, per capita daily food consumption rose from 3300 kcal to 4000 kcal between 1970 and 2000, thus contributing to an increase in fat. This suggests that it might be a good thing if Americans responded to higher food prices by buying and, presumably, eating less.


Except that it's more likely that people will be buying McDonalds and Pringles, because those are cheap, whereas buying vegetables and such is not.
5.13.2008 5:00pm
Buckland (mail):
EIDE_Interface Says:


How do we know it's the same shopping list? I can't believe her bill increased 60% on the same items. I know mine hasn't increased more then 10%.


And that was my point, although I was too lazy to actually make it. Something very interesting was going on there. One possibility is that she buys a very few items that have increased more than most (maybe she and Obama are shopping for arugula at the same Whole Foods store). Another is that they're eating out less often and therefore buying more groceries. My guess is that she's just telling an interesting story and the newspaper was numerically challenged enough that they didn't realize the example didn't support the magnitude of the increase.
5.13.2008 5:02pm
rarango (mail):
As Buckland and Eide both suggest perhaps the shopper in question is a twit and not capable of managing subsitutions, figuring per unit pricing or understanding nutrition. Share what she is spending her money for and then we can decide if this is really news or just another alarmist piece.
5.13.2008 5:11pm
Waldensian (mail):
I'm still trying to figure out why people think milk is some sort of necessary food. It's for cows, for crying out loud, and a huge number of humans can't even digest the stuff. What other product has to constantly barrage consumers with the claim that it's natural? And for this product we have incredibly complex government price controls?

Bizarre.
5.13.2008 5:11pm
SenatorX (mail):
We have to buy mostly organics and the cost of these has gone way up in the past 6 months (around 40% nearest I can tell). I read it had something to do with the profit farmers can make now with non-organics but I don't really know.

Another thing you may be missing is the housing crash. Many people for the past 6 years have been pulling equity out of there homes periodically to pay off all their credit cards and have extra cash. This is gone now. What seems to be happening in the past 6 months is that many people are putting everything on credit as the refi and heloc craze has ended. Worse according to the retailers like Walmart they are spending more on food and necessities and less on discretionary. Hard to put a good spin on things when so many are having to borrow at high interest rates to buy necessities.
5.13.2008 5:18pm
harsh pencil:
Food expenditure as a fraction of income actually overstates food inflation since over time we have been shifting to more expensive foods: more meat, more convenience foods, out of season fruits and vegetables for instance.
You can eat pretty cheaply here if you at like
those in the 1950's. (No prepared foods. Lots of potatoes. Lots of canned goods. Perhaps bake your own bread.)
5.13.2008 5:27pm
Zubon (mail) (www):
Can I have a source on that 4000 kcal/day claim? By my math, that has people gaining over 100 pounds per year.

I know I cook simple meals, but I am not seeing these numbers. $200/week for three people? And how are Pringles cheaper than vegetables? They are made from potatoes; a tube of Pringles on sale costs the same as a ten-pound bag of potatoes at my local grocery ($1).
5.13.2008 5:29pm
Paul Allen:
Yes, Eugene you've missed the boat. Prices are primarily increasing in grains. So-called commodity food prices are up 70% or so and compounding. Most food stuffs in the store have prices only fractionally attributable to the change in grain costs. This arises from 1) a significant portion of other costs such additives, research, branding, labor, etc and 2) the use of price-hedges by most major food companies as well as vertical integration practices--e.g., McD is the worlds largest potato grower and one of the largest ranch operators.

They forgo commodity price gains for stability in their core business.

Also, the price of derived food such a chicken and beef is more an integral of historic costs this creates price inertia.

If you focus on just those staple products, grain, meat, dairy... the price increase is a dramatic 2x in two years. Food CPI uses a distorted market basket. CPI has been calculated using geometric average since 1993. The effect of this is that items whose price is rising tend to get factored out of the market basket on an arithmetic mean basis.
5.13.2008 5:34pm
SenatorX (mail):
If you want to look at something that IS getting cheaper go shopping for clothes. Fantastic bargains right now on all things worn.
5.13.2008 5:34pm
Dan Weber (www):
4000 kcal/day may be what we produce, but there is lots of food waste. That still sounds out-of-whack with reality.

As for Amy, actually reading the article reveals:
Quickly, Brnger, a school counselor and mother of a 9-year-old daughter, looked for ways to save. She buys fewer organic products, which can cost twice as much as conventional goods.

So there you go. Organic already has a huge mark-up, since people are willing to pay more for food that poor people cannot afford. If regular food goes up, organic has to go up, too.
5.13.2008 5:38pm
frankcross (mail):
JF Thomas is right, though, in that you can't take a mean of income as representing much of anything. The relevant issue would be the median (or submedian) income. Those are the people for whom food prices are problematic.
5.13.2008 5:38pm
Lior:
Comparing total food prices and total disposable income is not very useful, since the problems are at the margin: the total disposable income is influenced by the income of the very rich, while rising food costs (if they occur) are a problem for the very poor. Eugene's analysis is relevant to national economic planning (do we need to support agriculture? do we need price controls?), but not to "food crisis" planning.

Educated people with internet access (the readers of this blog) know that food in the US is fairly cheap compared to income (meat is absurdly cheap, and you can get a better and cheaper diet based on beans and starch). Part of the stereotype of the poor in the US, though, is that they don't know this. Is that really the case?
5.13.2008 5:40pm
gattsuru (mail) (www):
Except that it's more likely that people will be buying McDonalds and Pringles, because those are cheap, whereas buying vegetables and such is not.


Er, when's the last time you actually went to a grocery store, or even WalMart?

I just did a weekly shopping run yesterday, and enough healthy food to last two individuals seven days came in at 62 USD. That's including more expensive stuff like bell peppers, soda, brand name cereal and condiments, salami, and healthier cuts of meat -- getting rid and sticking to more basic goods would reduce the costs even further.

You can't get a weeks worth of food for *one* person from a fast food joint at 62 USD, nevermind two. With the exclusion of one of the dinners, all of these meals can be assembled in less than the average wait time at Taco Hell or McDonalds.

If you see people head from home-cooked meals to Big Macs and Pringle cans, it's not for rational economic reasons.
5.13.2008 5:44pm
rarango (mail):
As Gattsuru notes, food prices are really quite reasonable--Substitute pork for beef: in Memphis a boston butt or shoulder roast is .97 a pound. That will get you three meals. Pork tenderloin is 3.50 a pound. Farm raised catfish is 3.00 a pound. Canned and frozen veggies are dirt cheap. Food availability and low cost, along with American Public Health, are two of our great achievements in the last 100 years.
5.13.2008 5:52pm
MarkField (mail):
J.F. Thomas and Frog Leg seem to me to have it right. Here's a discussion of their point.
5.13.2008 5:55pm
MarkField (mail):

As Gattsuru notes, food prices are really quite reasonable--Substitute pork for beef: in Memphis a boston butt or shoulder roast is .97 a pound. That will get you three meals. Pork tenderloin is 3.50 a pound. Farm raised catfish is 3.00 a pound. Canned and frozen veggies are dirt cheap. Food availability and low cost, along with American Public Health, are two of our great achievements in the last 100 years.


Substitution is a complex issue when it comes to food. Putting aside the fact that some people can't, for religious reasons, substitute pork for beef, the two meats supply different nutrients. In order to get a balanced diet, it's important to be able to afford a variety of foods.

The other point about substitution is that, even from a pure taste perspective, changing steak for hamburger isn't really fair. That's not "substitution", that's getting a lesser product.

As for low prices for food, those are, to a substantial extent, attributable to the farm price support system which regularly gets bashed on this blog.
5.13.2008 6:00pm
J. F. Thomas (mail):
J.F. Thomas and Frog Leg seem to me to have it right.

That can't be right. I am only here to troll.
5.13.2008 6:03pm
Jody (mail):
You can't get a weeks worth of food for *one* person from a fast food joint at 62 USD

Ahh gattsuru, I see you are not a Dollar Menuaire (3x7x3 = 63, so drink water for a few meals and you're good to go, tax included).
5.13.2008 6:08pm
Stormy Dragon (mail) (www):
Things have been going so well for the last 2 decades or so that people have decided this is now normal and every time something becomes slightly less fantastically good, everyone acts like it's a major crisis.

To put a light on the subprime housing 'crisis' for instance, I was watching Wallstreet last week and was rather amused at one scene where Charlie Sheen's character is shopping for a condo and the realtor says (in a conspiratorial voice as though she's doing him some great favor) that her husband can probably get him a mortgage for 'only 10%'.
5.13.2008 6:11pm
The Ace:
I think this misses to very regressive aspects of the current situation. First, increases in food prices act regressively. That is, when the price of eggs go up, it hurts the lower class harder than the upper class. After all, unlike other goods, there is an upper level limit on how much any one person can consume in food.

Second, the economy generally recently has been harmful to the lower class. We hear regularly about how the earning power of the lower class has decreased over the past 10 years, and how the gap between the rich and poor has been expanding. The food price increase serves only to stretch that gap.
5.13.2008 6:13pm
one of many:
I'm a little puzzled by that $200/week for 3 people also, I see 4 at about $130/week with a goodly chunk of luxury food in the mix. $9.50 per diem for groceries? That's a pretty hefty grocery bill.

Wald, mostly it's calcium, and it's a large part a hold over from when cow milk was a year round product while other calcium sources (leafy green vegetables mostly) were seasonal. Calcium is pretty essential for good health and even short term calcium deficits can have long term health effects, but in the 21st century US there is no shortage of other calcium sources available year round. Cows milk is not the best source of calcium BUT it was (for most of human civilization) the most universally available source of dietary calcium.
5.13.2008 6:14pm
stunned:
i think it's a trend issue. it's a good idea to identify problems before they become big, etc.

also, one of the major premises is that corn prices are being driven way up and corn, for reasons good and bad, is a huge component of our food supply. if producers have absorbed some of the cost increases so far, or if they have long-term contracts/hedges that have kept their actual costs low in spite of the spot price changes, there could be a lag before the increase shows up in consumer prices.

The BLS lets you view components of the PPI. "Farm products" went from 127.1 to 167.8 from 1/2007 to 3/2008.
5.13.2008 6:15pm
stunned:
(that's a 32% change)
5.13.2008 6:16pm
gattsuru (mail) (www):
Prices are primarily increasing in grains. So-called commodity food prices are up 70% or so and compounding. Most food stuffs in the store have prices only fractionally attributable to the change in grain costs.


Grains might make up a good portion of people's diet, depending on what they eat, but they don't really seem to make up a good portion of costs. The idea of people living off bread and milk might be an interesting one, but it's neither realistic nor cost-effective. Bread, tortillas, pasta, and other basic grain products, despite the '70% increase', are still not going to put you back more than the PB&J, taco meat, or tomato sauce that you put on them.
5.13.2008 6:22pm
stunned:
I also recommend checking out corn (Series Id: WPS012202). It went from 95.6 in 2006 to 141.5 in 2007 and 217.8 as of 3/2008.

That's a 48% change from '06 to '07 and a 128% change between '06 and 3/08.
5.13.2008 6:26pm
Bender (mail):
Interesting that the foodstuffs posting the biggest price increases -- milk, eggs, grains -- are those whose production and distribution has incurred the most government intervention. Less controlled food production, e.g., truck farm produce, has seen a much lower increase in cost. Might it not be reasonable to draw a policy lesson from this?
5.13.2008 6:27pm
Houston Lawyer:
Does this mean that the average poor person in this country will lose that extra two or three bowling balls worth of fat that he has been carrying around?

I have noticed food costs increasing lately. However, I believe we may have had food cost deflation over the last two decades.
5.13.2008 6:27pm
Paul Allen:

The other point about substitution is that, even from a pure taste perspective, changing steak for hamburger isn't really fair. That's not "substitution", that's getting a lesser product.

Just so. Unfortunately, CPI is calculated in tricky way. Steak used to be in the CPI basket but now its mostly ground beef. The argument? When prices go up people substitute. This is also known as a declining standard-of-living. You should read http://www.shadowstats.com/article/56
5.13.2008 6:28pm
Duffy Pratt (mail):
Don't worry J.F. Thomas: even a stopped clock is right twice a day.

And yes, everybody should only go to sites where they agree with everyone else all the time.

It's hard for me to tell whether food prices being a huge problem is a result of those terrible democrats, who are just using it as a wedge issue for the elections. Or is it the evil oil companies, who are trying to put the clamp down on ethanol and food based energy products. Or maybe its that vast conspiracy between the two??? Sometimes this stuff gets so confusing.
5.13.2008 6:33pm
BChurch (mail):
The problem with this is that the statistic "food spending as percentage of disposable income" is a worthless statistic when averaged across wide ranges of overall income.

There's a problem of diminishing returns here. As disposable income increases, you're only going to see a directly proportional increase in food spending at the bottom of the scale. People with $2M disposable yearly incomes don't spend twice as much on food as those with $1M. You'd have to go from spending about $500 per DAY on food to almost $1000 per day. That's pushing the bounds of what's even possible to spend on food, much less practical or likely to happen.

So say you have a person with $1000/week disposable income and a person with $100/week disposable income. The former might spend 10% of that on food, while the latter might spend 50%. If food prices go up by 6% in a year, then the former sees the increase as one from 10% to 10.6% of his disposable income, less than one percent. The latter goes from 50 to 53%, a bit more noticeable, especially when you've got every cent of that budgeted out.

Combine this with the fact that income increases have not been equally achieved (if at all) by all incomes levels, and the story's not as rosy as you've painted.
5.13.2008 6:33pm
JB:
As others have said, what matters is the median, not the mean.

Also, it's not just a simple food price increase. Everything's getting more expensive. Gas, heating, housing.

You can't just average that away.
5.13.2008 6:34pm
BChurch (mail):
Not to mention that the more well off consumers can simply change his purchasing habits (foregoing name brands, eg.) to counter the price increase. When you're already living off of peanut butter and ramen noodles, you eat (no pun intended) the full increase whether you like it or not.
5.13.2008 6:36pm
Lior:
JB:
As others have said, what matters is the median, not the mean.

Actually, the issue here is not the mean or the median. It's the bottom margin.
5.13.2008 6:54pm
Allen G:
Have you seen the price increases of gourmet cheeses though? In 1999, I could buy Montgomery Cheddar, a Neals Yard cheese, for $10 to $12 a pound. Now, I'm luck to find it for under $26. I've cut back my cheese expenditures greatly. Last Sunday, when I was at my mom's for mother's day, I'm ashamed to say... I actually ate a slice of Kraft pre-sliced American cheese from her fridge.

The economy is brutal.
5.13.2008 6:58pm
eric (mail):


Actually, the issue here is not the mean or the median. It's the bottom margin.


Correct. The idea that the average American struggles to eat is just silly.

In fact, many of the poor eat extremely well. If anyone here every went to a discount grocery store they would certainly see people buying ribeyes and t-bones with food stamps.

If you can eat it, pork is an amazing buy though. $3.50 a pound for tenderloin. Beef brisket almost costs that much.
5.13.2008 7:21pm
eric (mail):
Allen G that was funny.
5.13.2008 7:25pm
Mahan Atma (mail):
JF Thomas is right -- the gains in total income have gone almost entirely to the rich and ultrarich, so looking at the mean (as compared with the median) tells you very little about what is happening to the rest of us.

There's another ancillary point however: The main reason average personal income has gone up over the last few decades is due to the fact that we work many more hours on average, primarily due to the entry of more women into the work force.

If you looked at units of food per hour of labor worked, you'd probably end up way back into the 1950s or thereabouts.
5.13.2008 7:29pm
BChurch (mail):
Eric

I wonder if the lucky-duck poor know that they can technically survive for weeks without any food at all, so long as they drink water and eat nutrient supplements. In fact, they can live indefinitely on nothing at all but ramen noodles, breakfast lunch and dinner. I don't see why they should have any right to complain about increasing food prices, when they already waste so much money on food that isn't the absolute cheapest possible sustenance.
5.13.2008 7:31pm
Mahan Atma (mail):
"If anyone here every went to a discount grocery store they would certainly see people buying ribeyes and t-bones with food stamps."


I've never seen this. Can you provide any actual evidence that this is common?
5.13.2008 7:34pm
Eugene Volokh (www):
I'd be happy to post updates reflecting median income -- and, if available, a median income-earner's food costs -- instead of the average. I'd be happy to do this for the 20th percentile, too, if you can give me the data.

I suspect that a food consumer price index increase of 4% will be roughly the same for median income earners and 20th percentile income earners. The disposable income increase might be different, but I expect the bottom line will be only a very small increase in the share of disposable income going to food, even for median income-earners and 20th percentile income-earners. But I'd be happy to report on that data; unfortunately, my quick searches didn't yield any good data on 2006-to-2007 changes in national median family income, though perhaps I missed some.
5.13.2008 7:43pm
vivictius (mail):
Im not sure how common it is for people to actually buy t-bones and ribeyes with food stamps but it is no restriction on it. I know there are some restrictions on what you can buy with food stamps (like no booze) but the staples (meat &vegies) are not restricted.

Of course, some people with food stamps that I am aware of buy bulk packs of meat (like whole rib roasts) with food stamps then turn around and sell them for fifty cents on the dollar. I assume they then buy booze and drugs with the money but I suppose they could by buying toys for homeless orphans.
5.13.2008 7:50pm
frankcross (mail):
EV, I think the lowest quintile spends nearly half their disposable income on food. So an annual 4% increase would represent nearly 2% of their disposable income in one year. Assuming that these people are pretty much living on the edge, that could be material.
5.13.2008 8:12pm
glangston (mail):
Two more years at that rate and we'll be back at the 1989 level. That wasn't bad. How far back would you be willing to regress?



Back to the days before we were an obese nation.

If people made better choices the cost of food would be a non-issue......well, there's always going to be people crying over spilt milk, but...
5.13.2008 8:35pm
SenatorX (mail):
I used to shop at a Winn Dixie and had to wait in line behind giant carts full of junk food and meats all paid for in food stamps. This wasn't a rare occurrence at all.

My question is that if "Actually, the issue here is not the mean or the median. It's the bottom margin." is true and the bottom margin is paying in food stamps then really aren't the middle the ones who really feel the pain? Not poor enough for handouts and not rich enough for it not to affect your bottom line.

The CPI is a joke anyway. They rejiggered it in the 90's so the current method is false. Go back to the old method and cast it over a hundred years and see where we are. The substitution game is insulting too. Quality of life and purchasing power are what matter not the ability to downgrade to dog food for survival.
5.13.2008 8:41pm
rarango (mail):
Mark Field: OK--for Jews, granted pork is a problem. For non-jews it's not. Chicken and Turkey, both healthy and as long as Kosher, should substitute quite nicely. And is hamburger a substitution for steak? of course it is from a nutritional standpoint; perhaps not from some other kind of more um classist point. From a standpoint of nutrition, its entirely possible to cut your food bill in half and still enjoy good--IF NOT BETTER--nutrition. You will get less fat in your diet by going to cheaper grades of meat. You, and others can't possibly be asserting you can't substitute steak for hamburger and get "a lesser product" IN TERMS OF NUTRITIONAL VALUE. You can't possibly believe that frozen or canned vegetables don't have the same NUTRITIONAL benefit that fresh veggies do. If thats your argument, check with the USDA or a registered dietician or read the labels.

Now certainly, I would much rather eat a prime grade T Bone than a hamburger; I would much rather eat fresh greens than frozen greens--but I assure you, that the nutritional content of the latter is at least equal to the former. and in the case of fresh greens you might even avoid E-Coli. Is nutritional benefit a function of cost? My thought is no, and I would defer to any Registered Dietician who tells me otherwise. I am simply asserting that we have huge choices available to us, and we can gain the same nutritional value for, I suspect, half of what each of us are spending now for T-bones and arugula. You are not looking at subsitution from an economic point--you are looking at it from an aesthetic point. Your loss. You will be paying a bundle for food.
5.13.2008 8:41pm
MarkField (mail):
rarango, there's much truth in your post. Yes, you can get equal nutritional value from hamburger and steak, assuming fat content stays the same (or better). And yes, you can get good nutrition from most canned and frozen vegetables.

But none of that responds to my specific point, which involved your suggested substitution of pork (or, now, chicken or turkey) for beef. This is perfectly good if we only focus on the protein content, but not if we are concerned about, say, getting enough iron.

Moreover, even my agreement with you on the nutritional point doesn't really affect the impact people feel on their daily lives by food cost increases. If you're middle class and enjoy a steak every so often, you'll notice when you can't do that any more. And fish has gotten really pricey (with no easy substitute for the omega-3s). Same with the fresh/frozen issue.

But I certainly agree that Americans don't make good eating choices and could probably eat healthier for less money if they chose better.
5.13.2008 9:27pm
PLW:
If you use median income for all men from the CPS

And per-capita spending on food from the USDA

You'll see that the ratio of the two is roughly constant from 1990 to 2006, from a low of 10.1% in 1998 to a high of 11.2 percent in 1991 and 2006.
5.13.2008 9:33pm
Joshua:
Another thing the good professor is missing is an erosion of tolerance for economic hardship in the years since the Great Depression. This is even more true when it comes to unemployment rates. They topped 25% during the Great Depression, yet nowadays even a 6% unemployment rate gets treated as a national crisis.

The MSM probably has something to do with this skewed perception, but it probably has even more to do with America's sky-high standards for prosperity. Our nation is so far removed, culturally and psychologically, from the experience of the Great Depression that we really have no idea what genuine, pervasive and widespread economic hardship is like. Small wonder, then, that people freak out over historically minor spikes in food prices, unemployment or any other negative economic data.
5.13.2008 9:34pm
rarango (mail):
Mark Field--thanks for a courteous reply--I agree: I would rather have fresh foods, fresh salmon, and other what I would consider to be "better quality" foods than live with frozen varieties. And no doubt about it--when beef was selling for 51 dollars a hundred pound (feedlot prices) I could eat steak almost every day. I miss that. That part of the subsitution issue is much more difficult to quantify. Economics looks only at subsitition qua subsitution and has considerable difficulty incorporating quality into the pricing equation. And I agree whole heartedly--my own "quality of life" at least based on how I ate two years ago, has suffered. Fortunately, my nutrition has not. And I apologize for my rather egregious mention of pork as a subsitute when clearly that is a proscribed item for many Americans. Thanks, again, for the pleasant interchange. I enjoyed it.
5.13.2008 9:35pm
BChurch (mail):
Prof. Volokh,

http://www.ers.usda.gov/publications/tb1872/tb1872g.pdf

The data here is from 90-95 but I imagine it remains at least somewhat representative of the disparities. The bottom quintile of the population represents about 3-4% of total US income, and just over 15% of total food expenditures-- showing food consumption to be relatively inelastic with income (the 2nd through 4th quintiles are all close to 20%, with the slacked picked up by the guys at the top).

The relative consistency of total food spending across income groups, compared to the huge disparity in incomes, reinforces the idea that the looking at food expenditures as a percentage of the average income of the population is pretty meaningless, since food expenditures don't correlate proportionally to income.
5.13.2008 9:51pm
Waldensian (mail):

Wald, mostly it's calcium, and it's a large part a hold over from when cow milk was a year round product while other calcium sources (leafy green vegetables mostly) were seasonal. Calcium is pretty essential for good health and even short term calcium deficits can have long term health effects, but in the 21st century US there is no shortage of other calcium sources available year round. Cows milk is not the best source of calcium BUT it was (for most of human civilization) the most universally available source of dietary calcium.

I can see how cow's milk is less important to the U.S. diet now than it once was, but I can't believe that cow's milk was EVER the best (or most universally available) source of calcium for "most" of human civilization.

Do substantial numbers of the Chinese drink cow's milk? Have they ever? Same question for people in Africa? Can they even digest the stuff?!?

I think you are one more victim of the evil milk propaganda machine.

Oooh, I just hate milk.
5.13.2008 10:02pm
theobromophile (www):
with no easy substitute for the omega-3s

Flax seed! Organic eggs!

Oh, wait, organic eggs are on the "substitution" list, right?

While frozen vegetables are similar to fresh, the same cannot be said of fruit. Most of the canned fruit is canned in syrup (hello, HFCS), and you can't get most fruit varieties in the canned form.
5.13.2008 10:07pm
eric (mail):
BChurch said:


I wonder if the lucky-duck poor know that they can technically survive for weeks without any food at all, so long as they drink water and eat nutrient supplements. In fact, they can live indefinitely on nothing at all but ramen noodles, breakfast lunch and dinner. I don't see why they should have any right to complain about increasing food prices, when they already waste so much money on food that isn't the absolute cheapest possible sustenance.


Of course, I never suggested that the poor survive on nothing at all. You know that. I just suggested that my admitted anecdotal experience is that the poor are eating just fine. If they are on food stamps, they have no right to complain, because they are not actually paying for at least a large portion of their food.

Or maybe I just offended you. I mean they are your food stamps, after all. Spend them as you like. May I suggest the filet?

Mahan Atma said:


I've never seen this. Can you provide any actual evidence that this is common?


Go stand by a cashier at a grocery store in a poor neighborhood.
5.13.2008 10:20pm
Toby:

But none of that responds to my specific point, which involved your suggested substitution of pork (or, now, chicken or turkey) for beef. This is perfectly good if we only focus on the protein content, but not if we are concerned about, say, getting enough iron.

Dang. You just might have to cook the food in a cast iron skillet, then, to get all that back.
5.13.2008 11:09pm
DeezRightWingNutz:

Also, it's not just a simple food price increase. Everything's getting more expensive. Gas, heating, housing.


Did you come to this site directly after awaking from a coma?
5.13.2008 11:26pm
Aleks:
Re: For a long time, feeding her family of three used to cost around $125 a week. Suddenly this winter, her bill leaped to about $200.

I've budgeted $70 a week for two of us plus our cats (the budget includes common household and grooming supplies that you buy at grocery stores and pet food). My budget has held steady for the last three years. When I read about people like the above I rather suspect they are very ineffective shoppers.

Re: Except that it's more likely that people will be buying McDonalds and Pringles, because those are cheap, whereas buying vegetables and such is not.

I've actually noticed more inflation in fast food than I have at grocery stores. But since I donlt eat iot very regularly, I suppose I'm more prone to "sticker shock" when I do.

Re: Hard to put a good spin on things when so many are having to borrow at high interest rates to buy necessities.

Assuming we are not talking about people who are really truly poor (or have special problems, e.g., high medical bills) it's quite doable to live within one's means. Nobody need to run up their credit cards buying groceries, again absent truly unusual circumstances. People who do so are either very ineffective shoppers, or seeking to become accustomed to a luxurious standard of living that they should know they can't afford.

Re: In order to get a balanced diet, it's important to be able to afford a variety of foods.

Well, yes. But the idea that you *have* to eat beef-- or meat in general-- for a balanced diet is absurd. (I do agree that you probably need some animal proteins, unless you are willing to make a major and complex effort with a pure vegan diet; but you do NOT need a daily or even weekly ration of beef.)
5.13.2008 11:37pm
Gaius Marius:
Just have the government give the plebians free food and circuses.
5.13.2008 11:48pm
MarkField (mail):

Dang. You just might have to cook the food in a cast iron skillet, then, to get all that back.


Sure, but this kind of loses sight of the forest for the trees. Each case of substitution can be balanced out, but after a while it gets pretty complex.


Flax seed! Organic eggs!


Yeah, and I personally make use of both. But I'm not sure either is a true substitute for fish.


While frozen vegetables are similar to fresh, the same cannot be said of fruit. Most of the canned fruit is canned in syrup (hello, HFCS), and you can't get most fruit varieties in the canned form.


Agreed.

But let's face it: the real outcry will come when the price of chocolate goes up.
5.13.2008 11:59pm
MarkField (mail):

Well, yes. But the idea that you *have* to eat beef-- or meat in general-- for a balanced diet is absurd. (I do agree that you probably need some animal proteins, unless you are willing to make a major and complex effort with a pure vegan diet; but you do NOT need a daily or even weekly ration of beef.)


Again, my concern was with the basic idea of balance, not with the specific example of beef.
5.14.2008 12:01am
Paul Allen:
Substituting down to stay within a budget constraint is a declining standard of living. We should be so cavalier about accepting that, but it also goes on without our realizing. For instance, say you've bought the same brand of vanilla flavoring for twenty years. Is it the same? Mostly likely no. The portion of vanilla has been going down and corn syrup has replaced it to maintain the same unit size.

Companies engage in a wide array of cost containment practices because buyers are price sticky but comparatively content insensitive.
5.14.2008 12:24am
Mahan Atma (mail):
"Go stand by a cashier at a grocery store in a poor neighborhood."



Eric,

I routinely shop at a grocery store in West Oakland. I've never seen anyone buy an expensive steak with food stamps.

Thus fails your "proof by anecdote".
5.14.2008 12:30am
eric (mail):

I routinely shop at a grocery store in West Oakland. I've never seen anyone buy an expensive steak with food stamps.

Thus fails your "proof by anecdote".


Congratulations. You have managed to not see something happen. I have seen it happen many times. Pay more attention.

I never attempted to prove anything. You demand "proof" of something that is likely not studied at all other than by observation.

Besides, if you have never seen it happen, it must not be common, right?
5.14.2008 1:56am
one of many:
Wald, most universal is not the same as universal, just closer than the alternatives. As for China how they managed to acquire enough calcium in their diet prior to the introduction of spinach and kale is beyond my knowledge unless they either; had cows, clustered on the coast where fatty fish are available or simply suffered from malnutrition (note that suffering from not getting enough calcium is the same as cow milk being the most universally available). Cows have been domesticated for over 8,000 years and there are 4,000 year old recipes for yoghurt, some of the oldest writing.

As for digestion, yes those who are lactose intolerant can digest cow milk, just not as well or in as large quantities as those who are not lactose intolerant and many cow milk products (like yoghurt) do not cause them problems, while still providing an excellent source of calcium. Sub-Saharan Africa, which has a large chunk of lactose intolerant people has had domesticated cows for at least 4,000 years (maybe up to 10,000) as a dairy source.

Personally I think you are better off with fatty fish myself, but up until recently unless you lived where fatty fish could be found year round fatty fish was not a good option for getting your necessary calcium. Likewise one can get by with leafy green vegetables, but until recently those were both seasonal and limited in distribution. Going a different route, one could die at 40 of old age, in which case one could bypass most of the problems caused by not getting enough calcium in the diet (although calcium deficiency might contribute to your death of old age).

Calcium is important stuff, and no doubt somewhere along the line of human civilization it was noticed that people who consumed dairy were healthier and lived longer than people who didn't. It is not that calcium is the only nutritional factor in milk, but calcium is a large need of human beings which does not have other sources which mimic the range of man and man's seasonlessness.

I could be wrong though, it's just a working hypothesis on why the phenomena of "people think milk is some sort of necessary food" exists, it may also be attributable to a decimal point error (can you say "spinach").
5.14.2008 2:08am
eric (mail):
No studies, but a quick google search found this from the Greensboro News Record.


"I have to walk away a lot of times," said Ronda Brown-Powell, who co-owns the Bessemer Curb Market near downtown. She said she sees plenty of people buying expensive meat packages with food stamps. "It's sickening."


But this woman probably just hates the poor.
5.14.2008 2:10am
TyWebb:
The CPI is the most powerful evidence currently in existence that Mark Twain (or Benjamin Disraeli) was a wise man.
5.14.2008 2:34am
Kirk:
Eugene,
is there something that I'm missing here?
Yeah. Like "reasonable" gun control, and many other things, here the ratchet is supposed to turn in one direction only. Any other result is A CRISIS.

SenatorX,
We have to buy mostly organics
De gustibus non est disputandum, and all that; but really I think the claim of "have to" does require a bit of explanation.
5.14.2008 4:54am
Soronel Haetir (mail):
While not directly on point with food prices, I see the huge populations of very fat birds in US cities as major evidence that there is no major population segment actually suffering from systemic starvation.

If people were actually suffering, and not just perceiving that they were suggering in comparison to others, US cities would be devoid of sea gulls, pidgeons and rats.
5.14.2008 8:44am
Richard Aubrey (mail):
Joshua.
The Depression 25% was considered a crisis.
6% is a crisis, or not, depending on which party holds the White House.
Years ago, which was the last time I had any info, food stamps in our area were going at 70 cents on the dollar. Which meant that the recipients wanted 70 cents worth of something else more than they wanted a dollar's worth of food. I've been hungry. Pretty soon, there's no something else you can think of, much less want. So they aren't hungry, even without the use of foodstamps. Yes, I've seen the foodstamps buying what would be considered luxury items.

I have a relation who works with the working poor. One of her clients recently--having gotten a couple of dollars ahead--bought cabinets for her kitchen. I said, so what. Got to put the food someplace. No, said my relation. She doesn't cook. Doesn't know how. Buys prepared food.

Anecdotes, in sufficient quantity, are data for practical purposes. It seems we have sufficient, most of us, if not on this thread.
5.14.2008 9:12am
Buckland (mail):
Waldensian:


I can see how cow's milk is less important to the U.S. diet now than it once was, but I can't believe that cow's milk was EVER the best (or most universally available) source of calcium for "most" of human civilization.

Do substantial numbers of the Chinese drink cow's milk? Have they ever? Same question for people in Africa? Can they even digest the stuff?!?


No, most Asians and Africans cannot digest milk well. Indeed only a very small group of folks from Europe can digest it well, but most people in the world can digest it in small quantities. What's changed is the need to digest it a full 8 oz glass at once.

Lactose tolerance isn't a binary choice. There are many degrees of tolerance among all peoples. Asians and Africans have always had a little milk in the diet, mostly from goats and cattle. The people of the Steppes (Mongols, Tartars, etc) used horse milk for drinking directly and fermented beverages. Northern Europeans have the most tolerance for milk, but even there many can't digest cow's milk.

Another factor in this is that part of the current recommendation for calcium revolves around keeping the bones strong in old age. Through most of human history 30 years was considered old age. Therefore the idea of bone deterioration after 50 wasn't interesting. So supplementing the calcium of the leafy greens (that people used to get lots of) with a little milk, mostly in cooked dishes was enough, and most people have enough tolerance for that.
5.14.2008 1:02pm
Tony Tutins (mail):
When food occupied a much bigger chunk of household budgets, rent occupied a much smaller chunk. Plotting both food and housing costs over time would be instructive, as would average incomes vs. average salaries, to get the two-income effect. I'd also expect a "tough times" effect, when adult or even married children moved back with their parents, creating multiple incomes per household.

Go stand by a cashier at a grocery store in a poor neighborhood.

1. If one considers fresh meat and produce departments to be essential parts of a grocery store, there are almost no grocery stores in poor neighborhoods -- hence the "food desert" characterization of poor neighborhoods.
2. When I shopped at a grocery store (in my nice neighborhood) that catered to shoppers from the nearby poor neighborhood, the meat case was full of animal body parts I had never considered eating: trays of turkey tails, hog maws, hog jowls, etc.
3. The closest thing to meat that pregnant/nursing women can buy with their WIC coupons is dried peas and beans.

Where can one buy a ten pound bag of potatoes for $1? Here it would cost $6. Dollar fast food menus are disappearing, too: the 99 cent leg and thigh from Popeye's (Tuesday only) has been replaced by a $2.29 leg and thigh snack (includes a biscuit). Further, Popeye's has replaced their honey packets with honey sauce: 10% honey, sugar, and water if I remember correctly.
5.14.2008 2:17pm
Tony Tutins (mail):
Through most of human history 30 years was considered old age. Therefore the idea of bone deterioration after 50 wasn't interesting.

I don't know what to make of this statement. The psalmist put the days of our years at threescore years and ten. Jesus began his adult ministry at age 30, and I would put his life at least at the midpoint of human history. His mother, who was around to mourn his execution, would have been at least 50 when he died. Perhaps the notion of life expectancy is behind it. Average life expectancy was traditionally dragged down by large numbers of children who never lived to become adults. If you made it to age 21 in Europe, historically your chances of survival to 65 were quite good.
5.14.2008 2:30pm
SenatorX (mail):
Kirk we just have a child on a special diet because of allergies and other gut issues. I call it the caveman diet because he really only gets meat, veggies, and some fruit (along with all kinds of suppliments). For a while it was convenient to all eat the same dinners but we are starting to cut back organics for ourselves. You're right though "have to" is too strong and really we choose to just to eliminate potential problems he might have. I'm not against non-organics though or GMO food. I own a bunch of Monsanto stock for example.
5.14.2008 3:09pm
KeithK (mail):

Another thing the good professor is missing is an erosion of tolerance for economic hardship in the years since the Great Depression.


I think this hits the nail on the head. Now that the rivers of milk and honey are contained within their banks and no longer overflowing people think things are terrible.

Not that the increase in food prices isn't a concern. But it's far from a crisis.
5.14.2008 3:13pm
HenryH:
the meat case was full of animal body parts I had never considered eating


I think that's at least partly to be explained by ethnic preferences rather than affluence.
5.14.2008 3:16pm
theobromophile (www):
But let's face it: the real outcry will come when the price of chocolate goes up.

True story.
5.14.2008 3:38pm
jmo (mail):
"If anyone here every went to a discount grocery store they would certainly see people buying ribeyes and t-bones with food stamps."


I've never seen this. Can you provide any actual evidence that this is common?


I spent 3 years in High School and part of college working as a cashier in a super market and I can tell you it happens all the time. It's not so much steak, as it is spending $75 on food, then another $75 on cigarets, lotto tickets, and beer.
5.14.2008 6:19pm