The food truth: Ag policies feeding Europe cheaply while we pay more!

As the cost of food has skyrocketed, my wife and I have gotten pretty good at stretching our budget to the breaking point. We've cut back on our restaurant visits, joined a CSA for fresh vegetables, found the cheapest markets in our area, begun using the dollar store as a source for canned foods, and started taking a weekly trip to Trader Joe's.

Consequently, we've managed to eat as well, or better, than we did when food prices were lower; still, there are some areas where we can't cut back. For example, over the past year, the orange juice that my wife and daughter drink has gone up from $2.50 per half gallon to $3.99. On some days, I'm still able to get it at $6 for two half gallons, and I recently saw it at $5 for two, but these surprises have become few and far between.

We've all heard the numbers, but it's still worth noting that, according to the last Consumer Price Index report, Grade A eggs are up 40% over last year's prices. Cheddar cheese has risen 14%, dried beans have gone up 25%, and white potatoes have risen 11%. This has been happening for a couple of years: between 2006 and 2007, the Consumer Price Index for food rose by 4%. At the time, this was the largest increase in more than 15 years, but it has risen by a further 6% over the last year and food prices are on track to rise by 7% in 2008. The standard reason for this massive increase is that escalating gas prices have made it more expensive to transport food. While this is true, it is only a small part of the story.