Thursday, April 10, 2014

Rep. Jim McGovern (D-MA) to speak on food stamps and hunger at Tufts April 11

Rep. Jim McGovern (D-MA) will give the keynote speech Friday April 11, 4pm, at a Tufts University conference titled "Food Stamps and Hunger in America."

The event is part of the annual "Issues of the Future" conference organized by Tufts Democrats. Rep. McGovern is a leading advocate in Congress on behalf of U.S. nutrition assistance programs, including the Supplemental Nutrition Assistance Program (SNAP).

Chapter 10 in Food Policy in the United States addresses "Hunger and Food Insecurity," including links to many other readings and data resources. On this blog, related material can be found under the tags for SNAP and hunger. For example, a 2011 data visualization shows how SNAP participation ebbs and flows with the changing macroeconomy.

Tuesday, April 08, 2014

The dilemma of fair trade bananas

At Civil Eats yesterday, Aliza Wasserman explains the dilemma for the public interest entrepreneurs who are developing a fair trade banana market. The article describes a recent conference at Tufts University.

The most difficult question is whether fair trade bananas should come only from smallholders and cooperatives (preserving fair trade principles but limiting scale), or instead whether fair trade sourcing should allow larger plantations so long as they follow the stipulated principles (sacrificing a small-is-best principle but achieving a larger share of the total market).

Wasserman writes:
Fair Trade banana plantations have also been crucial to building a robust supply of Fair Trade bananas. Plantations represent both a key challenge and opportunity, by providing the promise to impact the broader industry and bring Fair Trade bananas to a larger consumer base. Nearly everyone at the conference hoped to impact the broader industry, whether they are focused on the future of small-scale or “smallholder” farmers, or the overall future of Fair Trade bananas.

But many of the presenters felt that the current pricing system, in which the Fair Trade certifying bodies, like Fair Trade International or FLO, distribute the same premium to plantation owners and small landholders alike, represents a major flaw in the system. Many in the industry believe that cooperatives of small producers should receive a premium that is linked to their higher cost of production relative to plantations, which can take advantage of economies of scale. Yet, the first banana producer to receive Fair Trade certification was a plantation, and scaling up Fair Trade would not be possible without them.
While a student at the Friedman School, Wasserman was a regular contributor to the U.S. Food Policy blog.

Monday, April 07, 2014

What if Walmart paid employees enough to avoid food stamps?

I enjoyed this video for sharp writing, clarity of data presentation, and measured tone.

While still relying on economic markets for a thriving food economy, we nonetheless can expect our major grocery chains to do better on wages. No matter what one thinks of the proposed federal minimum wage increase, it is clear that the nation's leading employers should face binding social norms that constrain them to pay wages that reach a certain threshold.

What should the threshold be? It is possible that some threshold would be too high, counter-productively putting grocery companies out of business. But, this video focuses on a much more humble and minimal threshold. At the very least, major grocery chains should pay wages sufficiently high to keep workers off the Supplemental Nutrition Assistance Program (SNAP) rolls.

Friday, April 04, 2014

Farmers want immigration reform

Nobody understands better than farmers that immigrants to the United States are real people and hard workers, not a caricature.

When the leadership of the House of Representatives last year nearly failed to pass the farm programs, conservation programs, and nutrition programs in the farm bill, it showed that farmers had lost much political influence in the House. Similarly, as ferociously anti-immigrant views recently have blocked immigration reform in the House, farmers again feel the loss of their political influence.

Greg Sargent in the Washington Post this week described the views of Craig Regelbrugge, the co-chair of the Agriculture Coalition for Immigration Reform:
“I hear from growers frequently who basically say, `I used to be a loyal check writer when the Republican Party called, but at this point, the checkbook is closed,’” Regelbrugge tells me. “I’m hearing from growers who are no longer writing checks supporting the party.”
Likewise, the Post quoted Mike Gempler of the Washington Growers League:
“We’re seeing a lack of response to our needs and concerns from significant parts of the Republican caucus in the House,” Gempler tells me. “They either have ideological issues or they are catering to a more reactionary crowd.”

“We want to see the leadership, including Cathy [McMorris Rodgers of Washington], move on this,” Gempler continues. “The chances for getting immigration reform are lessening quickly. If we don’t get this done by August recess, we’re going to be in trouble as an industry.”
Not all Republicans are anti-immigrant, just those who pander to certain constituencies that use terrible anti-immigrant rhetoric to block reform in the House. In more ordinary times, many farmers have voted Republican, and they likely will do so again in the future. I follow the carefully non-partisan work of the AGree agricultural policy initiative on this issue.

Thursday, April 03, 2014

Advertising fast food to children

Leading fast food companies have pledged to follow specific advertising guidelines under the Children's Food and Beverage Advertising Initiative (CFBAI), a project of the Council of Better Business Bureaus (BBB).

These voluntary pledges remain quite weak. One recent summary of the argument that these pledges are insufficient [note: slight edit for clarity Apr 5] comes from the Rudd Center for Food Policy and Obesity at Yale University. The companies describe the pledges in shorthand, saying loosely that they now advertise only healthy food to children. In truth, more precisely, the companies still advertise both unhealthy and healthy food choices to children.

For example, a company pledge may claim to show only children's meals with comparatively healthy sides and beverages (such as apple slices and milk) and not less healthy options (such as french fries and sugary soda). Even with no further deception, the advertisements for the healthy meals help build brand awareness with children, increasing probability of generating a purchase occasion. Once the child and guardian are in the restaurant, the company heavily markets apple slices and french fries, milk and soda, whatever it takes to make the sale. The CFBAI guidelines address advertising on television and the web and do not prevent marketing of unhealthy options at the point of purchase, so the unhealthy options remain a large fraction of actual revenues for children's meals.

And, in any case, there is further deception. New research supported by the Robert Wood Johnson Foundation finds that most children who view Burger King advertisements showing apple slices think the advertisement is showing french fries. The apple slices look like french fries, and the children overlook a small apple symbol on the package.

I do not believe the confusion is accidental. Reason Magazine's Hit and Run blog credulously accepts an account in which the children's misunderstanding merely shows that Burger King is effectively marketing apples by presenting them in an "apple fries" format, but that sounds like spin to me.

You can judge for yourself. Here is the actual video from the research team, led by James Sargent, MD, co-director Cancer Control Research Program at Norris Cotton Cancer Center. Ask yourself, is Burger King advertising only apples (as the company's CFBAI pledge claims), or is Burger King also in practice advertising french fries to children (in which case the company's CFBAI pledge is dishonest)?

I'm enough of an economist that a fast food company's marketing fails to outrage me. I expect Burger King to market burgers and fries as vigorously as it can, subject to the dual limitations of government rules and social norms. What bothers me instead is that organizations that purport to be independent referees serving the public interest -- such as CFBAI -- pretend that the fast food companies really have voluntarily ended their advertising of unhealthy food to children. It is admirable to seek market-oriented business-friendly solutions to social problems, but let's not deceive ourselves by claiming that marketing unhealthy food to children is a problem we already have under control.

Monday, March 31, 2014

New research on breakfast in the classroom

Educators and school nutrition personnel in recent years have been discussing and debating the merits of serving breakfast in the classroom at the start of the school day, rather than in cafeterias. Participation is higher for breakfast in the classroom, leading to high hopes for increased impact on beneficial health and learning outcomes, while at the same time raising concerns about over-consumption for children whose in-class breakfast is their second meal of the morning.

New research in the Journal of Policy Analysis and Management uses a "difference in difference" design before and after implementation in a large urban school district in the southwest, finding that breakfast in the classroom rather than the cafeteria has a positive effect on test scores. It is possible that the benefits are due to improved performance on the day of the test (perhaps because the kids were less hungry that morning) rather than longer term learning, but the favorable results are still notable.

This research, and related research, is discussed in a new video from ChildObesity180, an initiative led by Christina Economos and many colleagues here at the Friedman School at Tufts. This video, which briefly summarizes both sides of the debate before arguing in favor of breakfast in the classroom, is part of an extensive video series on school breakfast issues.

Thursday, March 20, 2014

Economists and the restaurant industry offer input on the minimum wage debate

With support from the Obama administration, Congress is contemplating an increase in the minimum wage, in small annual steps to $10.10 per hour by 2016. After that, the minimum wage would rise automatically with inflation.

A group of several hundred economists signed a letter of support sponsored by the Economic Policy Institute. The letter said the proposal would help 17 million workers directly, and perhaps another 11 million workers by boosting wage expectations at the low end of the labor market. The letter said the weight of recent research shows "that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market."

A competing group of several hundred economists signed a letter of opposition. The letter says the consequence of the minimum wage proposal is "that business owners saddled with a higher cost of labor will need to cut costs, or pass the increase to their consumers in order to make ends meet. Many of the businesses that pay their workers minimum wage operate on extremely tight profit margins, with any increase in the cost of labor threatening this delicate balance."

In my own profession, several leading agricultural and applied economists signed each letter.

The New York Times this week pointed out that the letter of opposition was not really written by Vernon Smith, the lead signatory, who is a Nobel-winning economist. The letter was circulated by a firm hired by the National Restaurant Association (NRA), which has much to lose from the new minimum wage proposal. Smith is quoted saying he hadn't known who originated the statement, but he didn't mind that it turned out to be the restaurant industry, because the content of the letter is what mattered.

I asked a couple of my favorite agricultural and applied economists who had signed each letter if they wanted to respond to the controversy. One who signed the letter of support just confirmed that he supported the proposed minimum wage increase, but preferred not to say more.

Dan Sumner, a leading food policy thinker and economist at UC Davis, who signed the letter of opposition, gave this response. I had asked him if he felt "ill-used" by the restaurant industry. His email tackles the concern that the NRA support was non-transparent, discusses anti-poverty policies he judges superior to the minimum wage, and casts the minimum wage unfavorably in the context of other governmental efforts to set prices.
Parke:

I just assumed the min wage letter was developed and circulated by an interest group. Interest groups are the ones with enough interest to organize such an effort.

But, like Lucas and Smith, the proposition and argument itself is what matters to me. I have no connection with fast food places.

I put the minimum wage in the category with farm subsidies as a silly policy ill-targeted and worse than worthless for three reasons.

a. It uses policy resources, effort and attention, that would be better spent doing effective things to help the poor, such as earned income credits or targeted education programs or quality day-care or ...

b. It sends the signal that government price fixing is good policy more broadly. I know from my own specialty that government-set prices are generally bad policy. Thinking we can fix labor market problems or ill-trained workers or any other problem by having members of Congress set some favored price based on what their favorite lobby says it should be just encourages shoddy thinking.

(You will recall that is my problem with the press and the Congress continuing to act as though food stamps had anything to do with food. The reason I like the SNAP program is that is is unrelated to nutrition and the nanny notion that the feds should tell people how to spend their money, even charity.)

c. Minimum wage is so ill targeted as a poverty program and really does make it harder for some poor gal with very little to offer to get that first job. If I have to pay $10 anyway I can turn her away and hire only her sharper cousin, who already had a leg up.

Anyway, that's my off the cuff thinking.

By the way, the interest groups I have least time for are the ideological lobby groups and NGOs that seem to be very loose with the facts and analysis. These range from Heritage to HSUS to the Union of Concerned Scientists. My sense is these folks are just as likely to have an underlying bias to everything they do, and they pretend they act in the "public interest" relative to firms and groups of firms who have clear financial motivations.

Dan