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A Market-Based Solution for the Obesity Crisis

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The Centers for Disease Control and Prevention recently announced that, since 2000, the amount of vegetables Americans are eating has stayed the same and the amount of fruit Americans are eating has gone down--about 1/3 of adults eat the daily recommended servings of fruit, and just over 1/4 of adults eat the daily recommended servings of vegetables.

"Over the last decade we have looked at behavioral intervention, like counseling to get people to include their fruits and vegetables," said report co-author Dr. Jennifer Foltz, a researcher in the CDC's National Center for Chronic Disease Prevention and Health Promotion. "But it's not so easy."

In fact, one of the reasons cited by non-fruit-and-vegetable-eating people for not eating fruits and vegetables was that washing and peeling was too inconvenient.

Subsidies won't work--while high prices may sometimes be an issue as far as organic or exotic produce, it doesn't appear that cheaper kale will spur the latent kale consumption that's been lingering inside us all our entire lives.

For that matter, free apples, broccoli, and crates of butternut squash likely wouldn't encourage healthier eating--it's simply easier to open a bag of Doritos or heat up a can of Spaghetti-O's. You don't have to wash or peel anything, though there is the inconvenience of having to throw away the bag or can when you're done.

And we all know about the costs associated with being overweight.

Aside from higher medical bills, the real-life costs, as calculated by researchers at George Washington University, who added in things like employee sick days and lost productivity, found the annual cost of being obese to be $4,879 for a woman and $2,646 for a man. (Amazingly, they also found that nearly 1 billion additional gallons of gasoline are used every year because of increases in car passengers' weight since 1960.)

So, What to do?

Shawn Hackett, a money manager with a specific focus on commodities has a solution:

"If people actually had to pay for the consequences of being obese, they would eat better. That’s the market mechanism that would work. Not subsidizing lettuce. In terms of daily life, there’s no deterrent. There’s a deterrent for not drinking and driving. And it keeps most people from not doing it. An insurance company can't set your rates based on how heavy you are. If there was a scaling rate that had people paying three times as much because they’re 200 lbs. overweight--from overeating, not from a glandular problem, etc.--you'd see immediate behavioral changes. Now, the food industry wouldn’t support this. They don’t make money on people being fit. Now, not everyone has to be anorexic-looking and thin as a rail; clearly we eat too much as a country. But to get kids to eat more apples? If it's cost-efficient to be thin, parents will make sure their kids are eating apples."

It's an interesting sort of reverse incentive that is probably the only way to substantively change peoples' eating habits. But getting something like this actually put in place would likely never happen.

Too inconvenient.

POSITION:  No positions in stocks mentioned.