Everything Is Bullshit: The Greatest Scams on Earth Revealed (11 page)

It’s around this time that Ivy League schools switched from a
strictly quantitative system of test scores to a more subjective, holistic
approach. The holistic approach was used to squelch diversity and the number of
Jews in American universities then plummeted. After these “reforms,” the
percentage of Jews at Harvard declined from 27.6% to 17.1%; Columbia saw a dip
from 32.7% to 14.6%. During this time period, the percentage of Jews attending
Cornell University’s medical school dropped from 40.0% to 3.6%; similarly, at
Boston University’s medical school, this number dropped from 48.4% to 12.5%.

The concept of giving preference to legacy of alumni also
started to gain prominence. This admission practice was created at Yale in 1925
and allowed admission officers there to admit “Yale sons of good character and
reasonably good record,” rather than more academically qualified candidates.

As late as the 1950s, prominent administrators at Harvard and
Yale publicly commented on the appearance of the kind of students they sought.
David Brooks of the
New York Times
summarizes:

“Paul Buck argued in several essays that Harvard did not want to
become dominated by the ‘sensitive, neurotic boy,’ by those who are
‘intellectually over-stimulated.’ Instead, he said, Harvard should be seeking
out boys who are of the ‘healthy extrovert kind.’ In 1950, Yale’s president,
Alfred Whitney Griswold, reassured alumni that the Yale man of the future would
not be a ‘beetle-browed, highly specialized intellectual, but a well-rounded
man.’ It wasn’t until the 1950s that these sort of barriers were dropped
against Jewish Americans and their numbers started to rise again at elite
universities.”

The above section isn’t meant to imply that Asians are the “new
Jews.” It’s meant to show the potential consequences of “black box” admissions
criteria and how disgusting those practices can be. Opaque processes can be
subject to considerable abuse.

Why This
Matters

The
elite schools of America hold considerable power. For much of this nation’s
history, they’ve been the gatekeepers of wealth, prestige, and knowledge. Entry
into their club confers privilege — it’s a signal to the world that you
are among the chosen to be selected for high paying jobs, leadership positions,
and power.

In today’s world, it seems hard to fathom that
federally-funded
, tax-exempt institutions could continue to
shroud their selection criteria in secrecy. It’s likely that admissions
officers are wonderful people, but what if every time they see an Asian
applicant, they subconsciously think: “Another piano playing, hard working kid,
with perfect SAT scores. Good candidate, but we can’t have a campus entirely
full of people like that.” Is that an okay thought today? Does it lead to
outcomes that represent our societal values? Will it be okay to think that way
in 20 years?

The nature of what is “merit” is
constructed by those who control the admissions decisions
. Before
the early 20th century, it was how good you were at Latin and Greek. Later,
what kind of family you came from become important. Today, the holistic
admissions criteria are a black box.

Many Asians believe they are being held to a different academic
standard than whites. This belief might be true or false, but universities
should release the data that puts the debate to rest. But if Asians are
underrepresented on American college campuses relative to what their academic
performance would predict, this seems like the sort of discrimination that
history would ultimately judge very harshly.

9.

THE FOOD INDUSTRIAL

COMPLEX

I
n 2011,
during a debate over the nutritional guidelines for school lunches, Congress
decided that pizza counted as a vegetable.
And not for the
first time.

The U.S. government first proposed that an unhealthy food, if it
contains trace amounts of a healthy ingredient, could count as a vegetable, in
1981. Looking for ways to cut the school lunch budget, the Reagan
Administration suggested that cafeterias could count ingredients in condiments
like pickle relish and ketchup toward nutritional requirements.

This was not good politics. The press and Democratic opposition
had a field day saying that Reagan had just classified ketchup as a vegetable.
“This is one of the most ridiculous regulations I ever heard of,” Senator John
Heinz, owner of Heinz ketchup, told the press, “and I suppose I need not add
that I know something about ketchup and relish."

The Reagan Administration dropped the proposal, but it soon
became law anyway. When the Obama Administration directed the U.S. Department
of Agriculture to revise school lunch policies, experts took aim at the rule
that allowed the tiny amount of tomato paste in pizza sauce to count toward the
vegetable requirements of each meal.

Any changes could jeopardize huge contracts for companies that
supply food for school children’s lunches, so the food industry spent some $5.6
million lobbying Congress to protect its interests. According to Margo
Wootan
, director of the Center for Science in the Public
Interest, two multibillion dollar companies spent the most: Schwan and ConAgra,
which each had large contracts for pizzas and fries used in school lunches.

Before the U.S. Department of Agriculture (USDA) could even make
its recommendations, Congress acted to make sure the push for healthier lunches
did not hurt the manufacturers of unhealthy foods. Congress passed an
agriculture appropriations bill that would deny the USDA funding to enforce any
policies that prevented the potatoes in
french
fries or the tomato paste in pizza from counting as nutritional elements.

The press enjoyed declaring that Congress had classified pizza
as a vegetable. Cynics shrugged at yet another example of the government
prioritizing the bottom line of businesses that manufacture sugary and salty
processed foods over public health.

Yet the one-sided nature of the food industry’s lobbying is
puzzling. Where were the broccoli, spinach, and carrot lobbies? Why didn’t a
member of Congress take to the floor with a set of talking points provided by
the leafy green vegetable lobby? Why can’t American farmers, who enjoy huge
government subsidies, stand up to the processed food lobby?

The answer lies in the economics of the food industry. The
possibility of branding processed foods — like Fruit Loops cereal, Chips
Ahoy cookies, and Ritz crackers — and selling them at high markups means
that the market for processed foods dwarfs the much less lucrative business of
farming fruits and vegetables. Those high markups also provide ample funding to
buy access to Congress, the White House, and organizations like the USDA that
set nutrition policy.

In addition, while large commercial farms do enjoy substantial
access to policy makers in Washington, “Big Ag” is not in the healthy food
business. American farms with lobbying power don’t grow
brussel
sprouts; they grow grains used to make the high fructose corn syrup in Coke,
the starches in processed foods, and the oil in deep fryers. This is somewhat
inevitable — a reflection of fruits’ and vegetables’ limited role in the
world food economy. But it is also a self-inflicted wound on American (and
global) health — the result of misguided government policy that
subsidizes the production of foods and beverages like Big Macs and Big Gulps.

The Poor
Margins of Broccoli Farmers

In
Washington, “the food lobby” has become synonymous with unhealthy food. In
2013, according to the Center for Responsive Politics, processed food
manufacturers spent $40 million lobbying while the fruit and vegetable industry
spent a mere $4.8 million. Moreover, two of the top three fruit and vegetable
contributors were a company that grows tomatoes for fast food chains and the
National Potato Council, which protects potato farmers interests in
french
fries.

To understand why the food lobby is dominated by companies
pushing unhealthy foods, a good place to start is the huge imbalance between
the amount of fruits and vegetables we should eat and the relative size of the
fruits and vegetables market.

According to nutritional guidelines published by the USDA and
the Harvard School of Public Health, fruits and vegetables should make up about
50% of a healthy diet. But the financial value of the fruit and vegetable
market is nowhere near 50% of the food industry. In 2012, the USDA calculated
that American farms earned $47 billion in revenue from fruits, vegetables, and
nuts. In contrast, just three American processed food manufacturers had
(global) revenues of $116.2 billion in 2013.

The meat and carb heavy American diet partially explains these
disparities. The Department of Agriculture estimates that Americans eat roughly
50% less fruits and vegetables and over 20% more grains and meat than
recommended by its nutrition guidelines.

But it is the economics of the food industry that really explain
why the food lobby is an unhealthy one. Processed foods have high margins that
fund large advertising campaigns, support substantial lobbying budgets, and
increase the size of the market; the importance of branding also leads to
consolidation that supports special interest lobbying. In contrast, farmers
growing fruits and vegetables make a commodity with low markups. There is
little money for lobbying and advertising, a smaller market, and fewer
mega-companies with big bullhorns in Washington.

To see these dynamics in action, let’s compare the economics of
selling vegetables with a processed food like cereal.

When John Harvey Kellogg and Charles Post began selling the
first modern cereals in the 19th century, they tried to protect their cereal
making techniques using patents and lawsuits. They failed. Their product was
simply processed wheat or corn, and its production was easy to replicate.

Despite today’s
variation, which derive
mostly from different shapes and added flavors, cereal is at its core a cheap,
nearly identical product. So cereal companies turned to advertising and
branding to protect their share of the market. In Eat Your Heart Out, Felicity
Lawrence writes that as Charles Post began selling Grape Nuts, he
declared that
“The sunshine that makes a business plant grow
is advertising” and marketed his cereal as “brain food” that could cure not
only malaria but also diseases of his own invention. The Quaker symbol of
Quaker Oats became the first nationally recognized cereal brand
; cereals marketed under the name Kellogg’s
followed. And,
of course, as cereal manufacturers battled for control of the rapidly expanding
market, they added hefty doses of sugar to make their “horse food” more
palatable.

The importance of branding and marketing doesn’t lend itself to
a decentralized market of small cereal makers; it means huge corporations with
high margins. In 2013, Kellogg’s reported that
of
every $1 consumers spent on its cereal, it earned 41 cents of gross profit; the
company is currently worth $24.1 billion.

Kellogg’s has a $24 billion market capitalization and trades on
the New York Stock Exchange because it does not just make cereal. It also owns
Pringles and manufactures a variety of processed foods from
Eggo
Waffles to Famous Amos chocolate chip cookies. The entire processed foods
industry is similarly consolidated; if you follow your favorite snack food up
the food chain, you’ll usually find that
it is owned by a
gigantic multinational company
. PepsiCo owns
Funyuns
,
Rold
Gold pretzels, and Sun Chip
s. Ritz crackers, Oreos, and Wheat Thins sell under the Nabisco
label, which is owned by
Mondelēz
International.
So whenever a federal agency or Congress makes a push to support healthy foods,
it essentially picks a fight with a collection of the world’s l
argest
companies.

It is possible to market fruits and vegetables and sell them at
a markup.
Honeycrisp
apples, designed for that
satisfying crunch when you bite into one, enjoys a high price premium two to
three times other varieties. “Organic” has emerged as a powerful marketing
tool, and prices of kale increased 25% over the past 3 years. Distributors use
tactics like selling produce in convenient sizes (such as one snack’s worth of
baby carrots) to differentiate their products.

In general, though, consumers treat fruits and vegetables as
identical commodities. The
honeycrisp
apple is a
rarity, and trends like kale-mania benefit the market rather than a single
company. Companies do market veggies, but as Dr. Roberta Cook of UC Davis’s
agriculture program notes, brand recognition is low. Brands need a year round
presence on supermarket shelves so consumers can recognize the brand and
purchase it routinely, but produce is generally seasonal. Efforts to link
recognized brands with a certain quality level and a higher price point is
hindered by the influence of weather on produce quality and prices.

Farmers and companies involved in produce distribution simply
provide a commodity at the going price, and the result is a much smaller,
leaner, and less centralized industry than the processed food industry.
Although fruits and vegetables are seen as high value crops, the majority of
small to medium sized farms are actually not profitable; those farmers support
themselves with non-farm incomes. Even the USDA’s most optimistic estimates of
the profit margins of large commercial vegetable farms are half those of processed
foods like cereal — the cost of growing produce eats up most of the
profits. The top 9% of vegetable farms, according to a 2007 agriculture census,
have annual sales over $500,000. That’s substantial, but it hardly compares to
PepsiCo’s revenues.

The
term processed
foods also applies
to more than just Oreos and Doritos. When we think of pasta sauce, we normally
don’t think of junk food. But as Michael Moss writes in the New York Times
Magazine, products like
Preggo
pasta sauce contain
huge amounts of salt and sugar, just like potato chips and cereal. The
processed food industry, then, is profitable, politically powerful, and even
more enormous than we realize. Is it any surprise that the food lobby is
synonymous with unhealthy foods?

An
Exercise in Mislabeling

The
power of the food lobby to protect processed foods from antagonistic policies
can be seen in its response to the 1990 Nutrition Labeling and Education Act.
Before 1990, food labels that listed ingredients and nutritional content were
optional and opposed by food manufacturers. The act, based on recommendations
from the Food and Drug Administration, sought to make it mandatory for the
first time.

An article in the New York Times in the early 1990s highlights
some of the processed food industry’s subversion tactics. Spokesmen claimed
that the labeling requirement would cost billions of dollars to implement and
put out studies that purported to show that consumers preferred extremely
uninformative labels. Above all, lobbyists stressed that the labels would be
too confusing for consumers. “If you are not [the Commissioner of the FDA], who
has a law degree and medical degrees,” Jeffrey
Nedelman
,
a vice president of the Grocery Manufacturers Association, told the paper, “you
are not going to be able to make sense out of all this information. The labels
need to be consumer friendly."

The legislation did pass — a reminder that not all
attempts to legislate health are doomed. But food lobbyists also managed to
carve out exemptions and even loopholes that could assist processed foods’
marketing strategies. Kraft Cheese, for example, went to the White House to
make sure it could keep marketing its cheese as low fat; the first Bush
Administration accepted the new rules only after the FDA raised the maximum fat
content for low fat foods.

The most prominent loophole, which nutrition expert Marion
Nestle describes in Food Politics, was that food manufacturers could market
products with the word “healthy” with very few restrictions. Similarly, the
legislation allowed companies to market the benefits of a product based on a
single, minor ingredient. It is this loophole that allows Kellogg’s to add
vitamin D to its cereal and then market its super sugary Frosted Flakes as “a
good source of vitamin D.” This is also the reason that the boxes of so many
sugar-laden cereals describe them as “part of a healthy breakfast.”

The Nutrition Labeling and Education Act became law, but it also
demonstrates how food lobbyists oppose public-minded legislation and can even
shape it in its favor.

The
McDonaldization
of the American Farm