This legend just won't die; the FDA required labels on foodstuffs and it was unclear how one should label a condiment; since ketchup was tomato paste and mainly water it was suggested that it fall within the realm of vegetables. A wag took that out of context, and as they say, the rest is history.
Strange but true - I once had a dream in which David Stockman explained to me that the schoolchildren of American would not be harmed if ketchup were labeled a vegetable.