They argue the voluntary guidelines would cause consumers to eat more fruits and vegetables produced in other countries and therefore fewer grains grown in America. According to research funded by the Grocery Manufacturers of America “demand for fruits and vegetables would increase by 1009% and 226% respectively” resulting in almost $500 billion more spent on imported food and $30 billion less on domestically grown grain.
Even if the voluntary guidelines were that effective and their study accurate, it’s audacious marketing spin to turn an overwhelmingly positive victory for public health into a big government, job killing attack on freedom.
Another industry-funded study claimed that the voluntary guidelines would result in the loss of 74,000 jobs. An analysis by the Economic Policy Institute, found the study riddled with “implausible” assumptions, historical inconsistencies and incomplete analyses of potential impacts to both the industry and economy as a whole. For example, the industry study assumes, without justification, a 20% decline in advertising and completely ignores the likely scenario in which companies shift advertising to other products or audiences. It also ignores the fact that there has been no negative economic impact since industry adopted its own guidelines in 2006. In fact, EPI concludes that the guidelines could have no impact on jobs or could even lead to job growth in other parts of the economy.
Finally, General Mills adds that the $1.6 billion in food advertising expenditures “would go up in smoke.” “$1.6 billion in economic activity cannot disappear without an impact on people’s jobs and livelihoods” they wrote.
While it’s likely food conglomerates would redirect their advertising dollars, media companies would also look for and find plenty of buyers. In fact, they’ve done it before. When Congress banned tobacco ads on TV and Radio in 1970 media companies stood to lose $220 million in annual cigarette advertising. Like their counterparts today, the networks, and broadcasters associations lobbied hard alongside big tobacco against the ban.
The media industry did fine. Total TV and Radio advertising sales has increased every year before the ban and after. According to media analysts, in 1969 ad expenditures on TV and radio were $4.85 billion. In 1972, they were $5.7 billion.
For decades, industries have opposed laws, rules and even basic consumer information that have made us all healthier. They always predict disaster but, in fact, they respond with new ideas and innovations and we all benefit. These voluntary guidelines merely suggest a path that industry should embrace.
Donald Cohen is the director of the Cry Wolf Project, a nonprofit research network that identifies and exposes misleading rhetoric about the economy, regulation and government.