After the PR Party with Michelle Obama

Only two months ago it seemed there might be a united front in the war on fat. In March, First Lady Michelle Obama challenged food and beverage companies to "entirely rethink" products high in salt, sugar, and fat as part of her campaign against childhood obesity. The companies eagerly jumped on her bandwagon. Kraft Foods (KFT) vowed to make deeper cuts in salt content. Coca-Cola (KO) and other drink purveyors trumpeted their decision to put calorie information on the front of containers. PepsiCo (PEP) said it would stop selling full-sugar drinks in schools globally by 2012.

Now the Food & Drug Administration is making it clear that the displays of goodwill won't be enough and that the agency will consider stiffer regulations to get what it wants. The beverage and food companies, eager to bask in the publicity surrounding Obama's initiative, see that they are being asked to commit to labeling and other changes that may prove far costlier than they anticipated. "This is not altruism; they are in the crosshairs, and they're going to stay in the crosshairs," says David A. Kessler, who led the FDA in the 1990s and is the author of The End of Overeating.

A late April meeting between Administration officials and food manufacturers turned rancorous over proposed next steps, according to an attendee. A big sticking point at the meeting was the FDA's consideration of "red-light, green-light" labeling on package fronts, or possibly a five-star ranking system, to help consumers quickly determine whether a product is healthy or not. The agency wants companies to voluntarily agree to front-of-package standards by the fall and has "not ruled out regulatory approaches" to force compliance, says Michael R. Taylor, the FDA's commissioner for foods. Says Scott Faber, the Grocery Manufacturers Assn.'s vice-president for federal affairs: "The FDA and the food industry are in alignment on the goals for a front-of-pack food labeling initiative, and we are working together to conduct and learn from consumer research."

When the First Lady, at a Mar. 16 meeting in Washington, first urged the Grocery Manufacturers Assn. "to move faster and to go farther" to help end childhood obesity within a generation, Kraft said it would extend a previous move to reduce salt in its tortillas and wraps to bacon and other products. General Mills (GIS), the maker of Lucky Charms cereal and Progresso soup, in April pledged to cut sodium by 20 percent in several products by 2015. The American Beverage Assn. is now running television and print ads touting the drink industry's commitment to lower by 88 percent beverage calories in schools.

Yet critics say the initial gestures were just that—and neither as generous nor as voluntary as they seemed. The beverage group's ads, food-marketing expert Phil Lempert says, may leave the mistaken impression that the companies acted on their own to remove full-calorie soda from schools. "It's not the soda companies that have done it, it's the school systems," says Lempert, an author and frequent commentator on food-industry trends. The new health-care law requires companies to list calories on package fronts, says Margo G. Wootan, nutrition policy director for the left-leaning Center for Science in the Public Interest.

When it comes to the industry's reliance on marketing top sellers such as Mountain Dew and Lay's potato chips to children, their "hands are tied," says Marion Nestle, a professor of nutrition at New York University. "They make products that they sell to kids, and if they're not going to sell them to kids then they're not going to make money," she says.

Consumer activists say "follow the money" to see the food industry's true intent, pointing to the $17 billion acquisition by the Northfield (Ill.) company in March of British candy maker Cadbury. (CBY) In the last five years, as Kraft talked about its emphasis on healthier foods, the company also spent nearly $28 billion on acquisitions—all of it to buy cookie and candy companies. Says Susan Davison, a spokeswoman for Kraft: "We've long been a leader in this area and continue to take our consumers' interests on health and wellness topics quite seriously."

A real campaign to end childhood obesity will entail nothing less than "a complete social transformation as to how the American family eats," Ezekiel J. Emanuel, a special adviser on health policy to the White House, said at a Bloomberg-sponsored forum in Chicago on Apr. 27. That may be more than the industry can swallow.

The bottom line: The food and beverage industries may balk if the First Lady asks them to take stronger action as part of her anti-obesity campaign.

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