His article is in part a response to an outrageous piece of big food propaganda put out using your tax dollars by the Dept. of Agriculture. Most outrageously, the USDA publication argues in favor of continued junk food advertising to children, using a strained analogy to cigarettes to claim that such advertising either has no effect or actually decreases junk food consumption.
Krugman also points to this bit of ridiculous free marked sophistry:
"Americans' rapid weight gain may have nothing to do with market failure," the article says. "It may be a rational response to changing technology and prices. ... If consumers willingly trade off increased adiposity for working indoors and spending less time in the kitchen as well as for manageable weight-related health problems, then markets are not failing."In other words, it is not a public health crisis if it is the product of market forces.
Also, if market forces prevent us from developing a bird flu vaccine (its just not profitable), and as a result, 2% of the Earth's population dies when the infection finally spreads to us wholesale, that will also be a good thing. After all, market forces did it.