You may have missed this news, but PepsiCo (the parent company of both Pepsi and Frito-Lay) recently cut prices on its signature snack foods, including Doritos, Lay’s potato chips, and Tostitos, by 15%. The official word was that it was a nod to “affordability” and a shift in the market toward store-brand products that drove the price change, but James Hickman, co-founder of the investment consultant Schiff Sovereign, had a different take.

“PepsiCo spent $2.8 million last year lobbying to keep junk food eligible for food stamps. Then, RFK got 18 states to ban SNAP purchases of soda, candy, and processed snacks. Within a week, PepsiCo cut Doritos, Lay’s, and Tostitos prices by up to 15%,” wrote Hickman on X. “The moment the government stopped subsidizing demand, PepsiCo had to compete on price. No regulation. No price caps. No antitrust probe. The subsidy disappeared, and the market corrected overnight.”

The millions PepsiCo spends on advertising and promotion each year generate significant revenue, particularly in convenience stores and other channels where it has secured shelf space ahead of smaller competitors. But the lack of “free” government funding, which can no longer be used to subsidize their products, means they must compete more aggressively on price.

As our Nate Jackson warned back in December, changes to the SNAP program were expected to tighten eligibility rules, as HHS Secretary Robert F. Kennedy, Jr. announced a push to eliminate junk food and sugary sodas from the list of eligible SNAP purchases. “We’re paying tens of billions of dollars every year to subsidize junk food, which causes obesity and health problems,” Jackson observed. “Then American taxpayers are being shaken down again for $1.9 trillion annually (and rising) for healthcare. How much of that is to treat health problems caused by the junk SNAP recipients buy?”

Fortunately, RFK was a strong enough leader to overcome the charge of “starving children” detailed by Caleb Nunes on these pages in December. “To a foreign onlooker,” wrote Nunes, “it would sound as if millions of Americans are one missed EBT recharge away from death, given how casually the media invokes ‘starvation’ whenever Congress hits a budget stalemate.”

Yet it’s not just grocery bills being affected by these changes. “Zoom out,” Hickman suggests, “and you can see just how much of price inflation in our daily lives is due directly to government spending — before we even get into monetary policy like printing money. When a guaranteed buyer shows up with a bottomless wallet, prices go up. Just look at college tuition. In 1965, Congress passed the Higher Education Act and began backing student loans with federal dollars. Since then, tuition has risen roughly three times faster than inflation. A year at a private university that cost $2,800 in 1963 now costs over $85,000.”

The same goes for healthcare, fraud, and overcharging the government for services, Hickman adds. But the changing market, with reduced government subsidies, even affects luxury shoes. As David Strom of HotAir notes, “The math in the sneaker resale market has absolutely crashed, and it is impossible to ignore the connection to the government shutdown and the sudden reduction in SNAP benefits, as everyone had to reapply.” He adds, “A gig — flipping desirable sneakers at well above retail prices — has suddenly become a money loser.”

Those Air Jordans people were hoping to cash in on are being sold for a loss, but the good news for most of us is that sneakers are going to be shoes again, rather than investments. Pushing Uncle Sam out of markets he doesn’t belong in and encouraging people not to make government graft a lifestyle is good for all of us, and it’s great to see an administration get serious about it.

“Apparently, we were subsidizing expensive hairstyles, eyebrow maintenance, manicures, and massages by picking up the cost of food for people. Liberals decried the economic effects on providers of these services, without realizing that many middle-class people who were subsidizing them were shocked to learn that,” wrote Strom. “I am not sure why my taxes should subsidize other people purchasing $200-$1200 sneakers.”

Americans really are willing to lend a helping hand, but too many are taking advantage of that generosity. If bringing the gravy train to a screeching halt helps out our wallets as well, that’s an added bonus.