With the tobacco industry's experience all too fresh in their minds, the nation's restaurants, beverage and food suppliers learned late last week that the Federal Trade Commission is going to subpoena 44 of them for all records of their marketing of junk food to children. The info will be gathered to aid in preparing a report to the Senate on child obesity. In the wake of the film Fast Food Nation (based on the best-selling book of the same name) and the award-winning documentary Super Size Me, public opinion seems to be moving away from blaming we consumers for our inability to deny the fry, and placing it on marketers of less-than-wholesome foods. Already this year we've seen the nation's restaurants scramble to divest themselves of trans fats.
However, an attack on core products such as doughnuts, pizzas, burgers and soft drinks would have enormous financial ramifications for businesses such as KFC (YUM Brands, NYSE:YUM) and McDonald's (NYSE: MCD), since those items are the profit margin.
This could also enhance the climate for personal injury claims.
Sen. Edward "Sticks" Kennedy introduced the Prevention of Childhood Obesity Act in the last Congress, and although it didn't emerge from committee, it appears that the issue will be on the front burner this time. Don't be surprised if the clerk at your local 7-11 starts asking to see proof of age before you can buy a Ding Dong.
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