The 10% Revolution: How Americans Broke Free from Food

Here's a number that reveals more about American prosperity than any stock market index: 10.4 percent.

That's the share of disposable income Americans spent on food in 2024—everything from groceries to that regrettable late-night burrito delivery. While you might wince at your grocery receipts, this figure represents one of the most profound yet invisible transformations in human history.

The Great Unnoticed Revolution

In 1901, when the Bureau of Labor Statistics first surveyed American households, families spent 42.5 percent of their budget just on food. Not housing, not healthcare, not entertainment—just keeping themselves fed. At today's median income, that would mean dropping roughly $2,600 monthly at the grocery store.

Even as recently as the 1960s, Americans were spending around 15 percent of their income on food. The steady decline from 42 percent to 10 percent over 120 years represents what economists call Engel's Law—named after German statistician Ernst Engel (not Marx's collaborator Friedrich Engels, a confusion that's plagued economics classrooms for decades).

Ernst Engel discovered in 1857 that as people get richer, the share of income spent on food shrinks. Poor Belgian families in his study spent 60-70 percent on food, while wealthier ones spent under 50 percent. This pattern has held across every country and century since.

The Agricultural Miracle Nobody Talks About

This transformation didn't happen by accident. It required one of history's most underappreciated revolutions: the complete reimagining of American agriculture.

In 1940, one American farmer fed about 19 people. Today, one farmer feeds nearly 170 people—a nine-fold productivity increase in less than a century. The majority of Americans worked on farms in 1850; today it's under 2 percent.

Take corn, the backbone of America's food system. From 1866 to 1936, yields stagnated at about 26 bushels per acre. Then came hybrid varieties, synthetic fertilizer, mechanization, and modern genetics. Today's farmers harvest over 180 bushels per acre—a seven-fold increase in what the same land can produce.

The result? Real retail food prices were actually 2 percent lower in 2019 than in 1980, even before accounting for the massive improvement in variety and quality. Americans today access food from every continent, in every season, at prices their grandparents couldn't have imagined.

The Global Food Freedom Index

This isn't just an American story, though America sits at the extreme end. Globally, Engel's Law holds exactly as predicted: Nigerians spend about 59 percent of consumption on food at home. Bangladeshis spend 53 percent. Chinese consumers spend about 21 percent. Americans clock in under 7 percent—among the lowest in cross-country data.

Food spending effectively functions as a freedom index. When two-thirds of your paycheck goes to eating, there's almost nothing left for education, healthcare, savings, or recreation. As that share falls, the rest of life opens up.

But What About Those Egg Prices?

Of course, recent grocery bills tell a different story. Food prices rose 23.6 percent between 2020 and 2024. Eggs spiked 8.5 percent in 2024 alone due to avian flu. The post-pandemic inflation surge was real and painful, especially for lower-income households.

But here's the crucial context: Even at the peak of 2022's food price panic, when headlines screamed about "31-year highs," Americans were still spending a smaller share of income on food than any year before 1991. The "crisis" was effectively a return to early-90s prices—which themselves would have seemed miraculously low to anyone in the 1950s.

Recent data shows Americans are actually spending less on dining out than before the pandemic and more on groceries. The narrative isn't "Americans are blowing paychecks on DoorDash"—it's "Americans are tightening belts because groceries got more expensive."

The Hidden Costs of Cheap Food

This triumph comes with serious caveats that don't appear on grocery receipts.

Engel's Law still creates stark inequality within America. In 2023, the lowest income quintile spent 32.6 percent of after-tax income on food, while the highest quintile spent just 8.1 percent—a four-fold gap. Programs like SNAP serve roughly 42 million people monthly, but underlying disparities persist.

The agricultural revolution that brought prices down also made ultra-processed foods the dominant calorie source in American diets. The downstream consequences—obesity, diabetes, cardiovascular disease—create costs that don't show up at checkout but absolutely appear in healthcare bills.

Environmental costs get externalized too. Industrial agriculture's greenhouse gas emissions, fertilizer runoff feeding Gulf of Mexico dead zones, and biodiversity loss from monoculture farming represent bills sent elsewhere. The welfare impact on billions of farm animals remains largely invisible to consumers enjoying cheap meat.