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The demise of the school bake sale

So you’re the president of your school’s volleyball team or a capella group or community service squad and you need to raise cash, pronto. It’s bake sale time.

Or perhaps, it’s not, thanks to the U.S. Department of Agriculture’s Smart Snacks In School standards, which go into effect July 1. Snack foods sold in schools now must be a whole-grain-rich product; have a first ingredient that’s a fruit, veggie, dairy product, or protein; or be a combo food that contains at least ¼ cup of fruit or veg. There are also caps on calories, sodium, sugar, and fat. Tried-and-true bake sale favorites–like brownies, Toll House cookies, and cupcakes–clearly miss the mark.

There is a little wiggle room here. According to the USDA: “Each state will have the flexibility to set a certain number of fundraisers that can sell foods or beverages that do not meet the nutrition standards.” My state, New York, has set the number of exemptions at zero.

Now, let me just say, I get this from a health perspective. The childhood obesity problem in this country is not going away. And just as I believe that it sometimes makes sense to take financial decisions out of the hands of people who are not doing the right things on their own (i.e. automatic 401(k) enrollment to boost the retirement savings rate), I believe we should sometimes do the same for health.

A Big Gulp tax would have been fine with me. But I’m concerned for another reason: Bake sales and other school fundraisers teach a real-life financial literacy lesson. Kids are put in the position of having to figure out pricing, marketing, inventory management, not to mention how to make change.

Last week, Mitch Roschelle, the partner at PriceWaterhouseCoopers who is leading its $60 million financial literacy campaign, brought eight volunteers to the Metropolitan Lighthouse Charter School in the South Bronx. They were there to teach a lesson in taxes. Simultaneously, a group of fourth-graders were holding a bake sale to raise money for a class trip. To be clear, they didn’t actually bake anything. They went to a bodega and bought Tastykakes, which they turned around and sold at a profit. “Anything that can simulate what business and commerce is really all about is highly impactful for the kids,” Roschelle says. “Without financial education in the schools, this is the way kids learn.”

And let’s be clear: Financial education–despite determined supporters like PWC and the Jumpstart Coalition for Personal Financial Literacy–is not in most schools. According to the Council for Economic Education, just 17 states require students to take a personal finance course (or that personal finance be included in an econ or civics course) prior to graduation. Only six states test students on their knowledge.

The other thing bake sales teach kids is how to sell. “Kids who don’t have the experience of selling something miss out on a big confidence builder,” says Jack Kosakowski, CEO of Junior Achievement USA. “They get said no to, and that’s daunting, but the first time someone buys whatever they’re selling, it’s a huge boost. Dan Pink, author of To Sell Is Human, couldn’t agree more. “I see where these administrators are coming from, but I wonder: What’s next? Lemonade stands? Girl Scout cookies?”

So where does that leave us? The Department of Agriculture says there’s still plenty of room for bake sales to exist. “Decisions on school fundraisers were purposefully left up to the states, and states can allow any number of fundraisers with whatever kind of food they wish,” says Cullen Schwarz, USDA spokesman. The guidelines don’t limit them before or after school hours or at sporting events on weekends. Selling items that meet the guidelines (zucchini muffins? banana bread?) is also fair game. And based on the fact that Domino’s Pizza (DPZ) is now delivering a guideline-compliant pizza to 3,000 schools across the country, I think we can bet on Betty Crocker and Duncan Hines to roll out product specially crafted for bake sales in no time.

For now, though, I’m of the belief that bake sales and other food-related fundraisers teach some important skills–skills that students aren’t getting anywhere else. Notes Pink: ‘”If that involves a smidge of sugar in kids’ diets, I’m okay with it.”

In this case, I am too.

More from Jean Chatzky:

Choosing an insurance plan: 3 common mistakes
Coasting at work? Here’s how to get ‘unstuck’
What investors can learn from big dawgs at the casinos