Everyone trying to add some sort of cheese snobbery but the actual answer is that it legally literally isn't cheese. That's the only reason it is labeled "processed cheese product". It's the same kind of nonsense around "Frozen dairy dessert" instead of something being ice cream.
Guess what, I KNOW this tub of mostly cookie dough isn't made out of just cream and sugar and cold. I prefer it that way in fact!
Be assured, Americans buy A LOT of cheese and Wisconsin will have strong words to say if you act like Americans don't "know" cheese
Give it another decade or so and people will have the same false snobbery around whether their canned alcoholic beverage of choice is a "real seltzer" or a "spiked soda" or....
In a typical American grocery store, many of the individually wrapped orange slices in the "cheese" section do not legally meet the requirements to be considered cheese. They still have their uses though (it's great for grilled cheese sandwiches, and contains emulsifiers that makes it great in soups or mac & cheese). There's also "American cheese" which is cheese, usually along the lines of a very mild cheddar, it's also a totally fine product.
To me, the label "pasteurized process American cheese" still says that it's cheese. Just the "pasteurized process American" kind. So it's still legally cheese.
Some of it is certainly gatekeeping, but part of it is that it contains components that are definitely not cheese, and it's mass-produced, which turns a lot of people off.
It's fine as a thing to eat, if it's a flavor and texture you like. Personally I avoid it, but it's passably ok as a part of a sandwich where there are other flavors around it. If I just want to eat some cheese (with or without some delivery mechanism like a cracker), American Cheese is the farthest thing from my mind.
There's a bit more to it. What most identify as American "Cheese" is the Kraft Single or its equivalent competitors, a product without enough cheese in it (< 51%) to even legally label as cheese, and per the FDA at least is not legally "American Cheese". It must be labeled as a cheese "food" or "product". But the branding emphasizes American, Singles, and Calcium, the rest is the fine print.
There are higher quality actual American Cheeses, that can actually call themselves cheese unqualified, brands such as Kretshcmar, Boar's Head, etc. Kraft does make a somewhat lower end version under the Deli Deluxe label. They are produced from a combination of Cheddar and Colby.
But its not just gatekeeping there is a wide latitude in the quality and constitution of the various products marketed as "American" cheese ..., some of them don't contain any milk! This type of market segmentation isn't as common with better quality cheese varieties for a number of reasons. At the extreme the "American" label gets put on dollar store imitation "cheese" singles. Whereas I don't know of much imitation provolone sold anywhere.
And mass-produced has little to do with it. Most deli cheeses are mass produced but people tend to have strong preferences for alternatives to American irrespective.
