HEALTHY FOOD

LOS ANGELES, California, United States (Reuters) - A new report from a California watchdog group is calling for the US government to disclose how much sugary soda and other unhealthy food is paid for with food stamps at a time when policy makers are searching for ways to contain the spiraling cost of diet-related illness.

It is the latest skirmish in a years-long battle over whether the goal of the federal nutrition-assistance program used by about one in seven Americans should evolve from simply fighting hunger to also encouraging healthier eating habits.

And it lands on the heels of a proposal by New York City Mayor Michael Bloomberg to ban sales of oversized sugary beverages by restaurants, mobile food carts, and movie theaters.

Coca-Cola Co and McDonald's Corp. have slammed the proposal, which also has prompted critics to accuse Bloomberg of trying to turn New York City into a nanny state.

Nevertheless, there is growing concern about the social and economic costs of expanding waistlines in the United States - where more than one-third of US adults and nearly one-fifth of US children are obese.

"The federal government should not be fueling America's epidemic of diet-related chronic disease with taxpayer money," said Michele Simon, president of consulting group Eat Drink Politics, which produced the report.

Titled "Food Stamps: Follow the Money," it also calls for the disclosure of redemptions paid to individual retailers, such as Wal-Mart Stores, Inc., as well as fees paid to JP Morgan Chase and other banks that have contracts to process the electronic benefits.

High unemployment and a tepid US economic recovery have conspired to boost participation in the Supplemental Nutrition Assistance Program (SNAP), which, despite a name change in 2008, is still widely referred to as food stamps.

Spending for the program jumped to $71.8 billion in fiscal 2011 from $30.4 billion in fiscal 2007 due to high unemployment and a weak US economy.

"SNAP's tagline is 'putting healthy food within reach.' Without data on how much money is being spent on Coke versus orange juice, or Lucky Charms versus oatmeal, how will we ever evaluate the nutrition goals of the program?" Simon asked.

The US Department of Agriculture, which oversees SNAP at the federal level, found it was not cost-effective to capture food data at checkout stands when the program's processing system was set up more than a decade ago, spokesman Bruce Alexander said.

"We are preparing to launch a new feasibility study to see if today's system environment makes this approach more feasible," said Alexander, who added that USDA has several projects underway to capture information on food purchases.

He said other national data sources provide a fairly detailed picture of the purchase and diets of SNAP participants and that the data overall show few differences in the food choices of low-income and high-income Americans.

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