Make American Dairy Farms Great Again! Adopt supply management

Posted on April 25, 2017, 1:18 am
9 mins

PHOTOS: Dairy cows in a mass milking machine at a U.S. farm, a pretty well run one from the look of this photo from the Wikipedia. Below: Not what dairy farming looks like any more; U.S. President Donald Trump, hero to the Globe and Mail editorial board, giving Canada, or someone, the what for.

Never imagine, even for a moment, that U.S. President Donald Trump was serious when he talked about standing up for the interests American farmers in his notorious anti-Canadian trade speech at the Snap-On Tool factory in Kenosha, Wisconsin.

Some Wisconsin dairy farmers may have been pleased when Mr. Trump began bloviating on the topic because anything is better than nothing when you’re in desperate straits. And have no doubt, a lot of American dairy farmers are in desperate straits.

But the interests Mr. Trump is defending are those of the multinational “agri-food” corporations that hold Wisconsin dairy farmers in a grip that approaches feudal vassalage, and which would love be able to do the same thing to their counterparts down on the Canadian farm.

Remember, despite his lies, misdirection and deceptions, the not-so-competent Mr. Trump serves the same neoliberal corporate masters as the quite competent Hillary Clinton, whom he defeated in last fall’s U.S. presidential election with a little help from his friends in the FBI and – who knows? – maybe the FSB as well.

So his problem with the “very unfair things” supposedly going on in Canadian agriculture’s supply-managed dairy, poultry and egg sectors may be that they offer a good, very good example to U.S. farmers that the agri-food lobby and its friends in Washington would very much like to eliminate forever.

On the other hand, speaking of desperate straits, with the end of his shambolic first 100 days in office fast approaching, President Trump may want desperately to look as if he’s doing something for the schmucks who voted for him when, despite his big talk, he hasn’t really done anything much at all since he was sworn in on Jan. 20.

Because when farmers are left to themselves, they can usually be counted on to produce themselves into poverty, it’s good to have something to blame for the problems you’ve created. As Wisconsin farmer Chris Holman observed in a recent blog post, “Sorry Canada, this time that thing is you!”

“Scapegoating Canadian trade policy is a brilliant move as morally flexible politics goes, but as is often the case with finger-pointing, anyone doing it in a situation like this looks suspiciously like a guilty four-year-old,” Mr. Holman wrote.

Since the U.S. Department of Agriculture estimates about 163 million litres of heavily subsidized American milk were dumped in fields, manure ponds or otherwise went down the drain in the first eight months of 2016, U.S. farmers in financial trouble would dearly love the opportunity to dump it in Canada instead. Supply-managed Canadian dairy farmers, by the way, receive zero subsidies from our taxes.

And lots of American dairy farms are in big financial trouble. According to the USDA, and state agencies quoted by Mr. Holman, about 500 Wisconsin farms close every year as the dairy industry there grows ever more concentrated. And, believe me, this has nothing to do with Canada.

Of course, bad neoliberal economic policies have the same kind of friends on both sides of the Medicine Line, which may be why the Canadian supply management system, which supplies high-quality product to Canadians at a fair price while ensuring dairy, poultry and egg farmers earn a living wage, has been under attack by the same types in Canada.

This explains why the Usual Suspects, like the neoliberal propagandists in Thinktankistan and their publicity auxiliary in Canadian media where Postmedia and the Globe and Mail compete to outdo one another with hysterical denunciations of supply management, are positively gleeful at President Trump’s bombastic attacks on Canada.

“Dear Donald Trump,” exclaimed the failing Globe and Mail in an editorial attacking at least some of its few remaining readers, “please milk Canada’s sacred dairy cow.”

It’s true that supply management does “interfere with the market” to ensure a steady supply of supply-managed products at a fair price – which is enough to send the Globe and Postmedia into paroxysms of apoplexy on ideological grounds alone.

But we can be reasonably sure that certain things will happen in the Canadian market without it, notwithstanding the fairy-tale promises made by neoliberal journalists, think-tank shills and a few geographically fortunate farmers located next to major centres.

First, as is happening in Wisconsin, there will be significant concentration of the Canadian egg, poultry and dairy farming into a few corporate hands.

In dairy, though, it may be all for naught over the long term for the simple reason most of our milk will eventually be trucked in from places with more favourable climates for year-round feed crops, like Mexico and the southern United States.

If you imagine that will make it cheaper, though, don’t bet the farm … as it were. Without supply management, Canada’s heavily concentrated grocery supply corporations will merrily continue to charge consumers pretty much what they please. The profits, though, will go into corporate pockets, not those of community members and farmers.

The occasional loss leader may give the illusion milk or eggs are cheaper, but that will come at the expense of dairy farmers and extra mark-ups on other groceries.

Moreover, the not-so-cheap milk you do get will be loaded with Recombinant Bovine Growth hormone and antibiotics necessary to run dairies in the U.S. market.

If you imagine the market will provide a niche for producers of artisanal products for consumers willing to pay a little bit more, dream on. Surviving Canadian dairies will be screaming to adopt the same strategies. They will say they have little choice, and they will be right.

The government of Canada will end up having to compensate farmers with quota to the tune of billions of dollars – which will be paid by you and me.

So the short answer is that while supply management gives consumers a quality product at a price that allows local farmers a living wage, the alternative is not cheaper milk, cheese, eggs and poultry. It’s the same price for lower quality food produced in dystopic conditions and hauled across the continent in diesel trucks.

Well, I suppose we should be thankful President Trump is not yet sending real bombs our way, but if this attack succeeds, you can count on it that the health of our economy, the success of our agricultural sector and the people who run it, and the physical wellbeing of Canadians who consume these products will all be worse.

As National Farmers Union President Jan Slomp cheekily advised Mr. Trump a few days ago, if he really wants to make American dairy farms great again, he should adopt supply management.

Please consider making a donation to help defray the costs of recent repairs to the AlbertaPolitics.ca website and its necessary move to a more reliable (and expensive) web hosting service. This post also appears on Rabble.ca.

18 Comments to: Make American Dairy Farms Great Again! Adopt supply management

  1. Jim Sontag

    April 25th, 2017

    Like you, I grew up in Alberta. The family allowance cheques we received each month didn’t even cover the cost of milk for our family. I have two sons and three brothers. I still love milk. And I still love egg salad sandwiches.

    I live in Europe now; in the Netherlands. They phased out milk quotas in 2015. It was a 10 year plan. Something like this – That piece of paper you have for each cow you have ($25,000 in Quebec, $40,000 in AB & BC) will depreciate by 10%/year until it’s over. Deal with it.

    In the NL we pay 1/2 the price for milk & cheese and we can but some of the best cheese in the world (not just Gouda) at the local market for much less. Imagine that.

    I’m still waiting for the day I can buy an Alberta grassfed ribeye steak in the local supermarket. I’d select that over the cuts I now buy from Brazil or Argentina.

    Reply
    • Ken Larsen

      April 25th, 2017

      Jim, I’m not sure you are aware of EU agricultural policy but that milk and cheese you are getting “cheap” is still heavily subsidized by the EU Common Agricultural Policy (CAP) and that will not change even if the quotas phased out. The subsidies under the US farm bill were just renewed less than two years ago for several more years.

      To give you an idea of the scale of these subsidies, one of the reasons Northern Ireland is considering joining the south is because roughly 85% of their farm income is subsidies from the EU which will disappear with Brexit – ditto for sugar beet farmers in Britain. The BBC reports that “on average 60% of farm incomes come in the form of EU subsidies.”

      There are zero annual Canadian government subsidies to dairy farmers and in my 41 years experience, next to nothing for grain farmers.

      The Canadian dairy system does not control retail prices; those are set by the three or four grocery chains that retail all the food in Canada. The dairy board just negotiates a wholesale price on behalf of farmers with processors and makes sure the production matches the demand. So we don’t have Europe’s “butter mountains” or the dumping of liquid milk as in the US.

      At my local grocery store there are lots of EU cheeses and supply management has not stopped one of the local dairy farms (Sylvan Star Cheese) from producing award winning artisanal cheeses, nor has it stopped dairy farmers from Quebec and elsewhere from doing so.

      BTW, you will be waiting a long time for that grass-fed Alberta rib eye because 90% of Alberta’s beef slaughter capacity is controlled by just two companies, one of them based in Brazil. So they have no incentive to segregate Alberta’s beef in their global supply chain. Bigger is only better for shareholders of giant corporations, not for farmers or consumers.

      Reply
      • Farmer B

        April 26th, 2017

        I agree 100%. The only thing I will add is that as a beef producer my share of the consumer’s dollar has declined over time. In the early 80’s there were many companies bidding on market ready cattle, today there are only 2, one US owned the other Brazilian owned. I believe that if supply management is eliminated the consumer will see little savings and the processors and retailers will simply take a bigger margin.

        Reply
      • Val

        April 26th, 2017

        “The Canadian dairy system does not control retail prices; those are set by the three or four grocery chains that retail all the food in Canada.”
        ——————————————————————
        that’s not totally true.
        CDC indeed does set the price on dairy products for retailers, whose price on their behalf can be higher but not lower of than one, established by CDC.
        perhaps that’s why never happen discount sale on dairy product like on the other groceries, except when expiry date approaching and retailer prefer to sell as “clearance” item instead to throw it into dumpster.

        Reply
      • Val

        April 26th, 2017

        “There are zero annual Canadian government subsidies to dairy farmers”
        ————————————————————-
        b.t.w. what a difference between subsidies given directly to particular industry by the government, and subsidies, consumers forced to pay by the government on behalf of particular industry?

        Reply
        • Ken Larsen

          April 26th, 2017

          Val, I believe your two observations are based on false assumptions. That wholesale milk price is the result of collective bargaining between the dairy farmers and the three or four dairy processing companies. This happens each month. So in the real world the Dairy Commission really only has the power to bargain with the processors not to arbitrarily set the price for consumers. Those “processors/retailers” are negotiating on behalf of their shareholders who want more profits and of course the three or four retailers are also looking to take their profits from both consumers and farmers.

          The Canadian retail price for dairy is really just what the market will bear. Even if farmers gave the milk away for free, the retailers would still charge what they do because they can. So our dairy dollars are more of a subsidy to the grocery retailers and their shareholders.

          Dairy products are often used as “loss leaders” in other systems to get people in the store and remember the US and the EU governments provide lots of subsidies to their farmers.

          Reply
  2. Maryinga

    April 25th, 2017

    Well this about sums it up. What terrifies me, is how little people seem to be able to care….or pay attention. Neo-liberal fantasies of unlimited wealth creation, and rising boats everywhere, are imploding everywhere. The only rising boats are luxury yaghts riding the high seas of global climate change…….and still, in the 11th hour, the consumer sleeps on, dreams of cheap, cheaper, cheapest rolling around in his/her head.

    Everyone who knows anything about farming….or the laws of supply and demand….or how ‘too big to fail’ generally means ‘too corrupt to have to answer to anyone………should be defending our dairy supply management system.

    That the likes of John Ibbitson, from the Globe and Mail, can echo Trump on the CBC and call our dairy management system a failure is proof that ‘fake news’ does exist.

    What Trump and his minions fail to mention is who it serves. BIG DUMB, DEAD MONEY. Trump is their guy…but he has more than enough friends in Canada, and I’m not just thinking of Brian Mulroney.

    Where are the friends of Canadian farmers? They need all of us.

    Reply
    • Farmer B

      April 26th, 2017

      Martinga, I appreciate your defence of supply management it is a good system. The only downside is the cost to enter the system. I was told the other day that the cost per cow for quota, the barn and the cow was 76 000 dollars. So to build a family size dairy farm of 80 cows would cost just over 6 million dollars. Only a select few have that kind of money.

      Reply
  3. Val

    April 25th, 2017

    have you ever wondered why in Canada dairy farmers aren’t allowed to sell their product directly to consumers?
    sure, you can arrange such and i did it when lived on acreage near dairy farm but in fact it’s illegal and the farmer if caught will be punished for it by the government.

    and can you explain what do you mean under “fair price” for dairy products in Canada?
    is similarly “fair priced” our banking and insurance services, telco, retailers (protected by $20 limit on on-line purchases across the border), paid health related services, medication, etc?

    Reply
    • Bob Raynard

      April 26th, 2017

      Val, one reason is because the milk is not pasteurized. It is a health board rule, and has nothing to do with supply management. I don’t know if it is the only reason.

      Reply
  4. GregH

    April 25th, 2017

    “his problem with the “very unfair things” supposedly going on in Canadian agriculture’s supply-managed dairy, poultry and egg sectors may be that they offer a good, very good example to U.S. farmers that the agri-food lobby and its friends in Washington would very much like to eliminate forever.”

    Well said.

    Reply
  5. ronmac

    April 25th, 2017

    The good news is the Globe may finally stop calling Trump a Putin stooge. But I suppose if dairy farmers take to the streets in protest and park their tractors on the front lawn of Parliamnet Hill, they will be labeled Kremlin stooges because don’t you know that Putin has has added Canada to his “hit list” and he’ll stop at nothing to disrupt our precious democracy.

    It’s part of the same march to world domination by US agribuiness that’s been going on the past few decades with the aid of NAFTA and other treaties.

    In places like Mexico small farmers were driven off the land by a flood of cheap American corn in the 1990’s. Same thing with Haiti which has some of the richest agricultural soil anywhere. Now it’s a ward of the Clinton Foundtion.

    Thousands of Mexicans and Haitians, driven off their land, have poured into sweatshop factories. I suppose the same fate awaits Cdn dairy farmers who will be driven off their lands into the bush to trap beavers.

    Reply
  6. TENET

    April 25th, 2017

    I trust the current supply of dairy products from Canada, I do not trust the “agri-business” brands in the U.S..

    All said, a milking cow contributes more, and has more intellect, than this U.S. president.

    Trump is a stooge to different interests on different days.

    We must stand our ground and protect our Canadian dairies. The assault on our sovereignty has only begun.

    Trump is full of cheap promises.

    Reply
  7. Paul

    April 25th, 2017

    As usual an excellent article. A couple of comments:
    – Even though Canada has a system to make it profitable for farmers, policies were implemented to reduce their numbers, the main one being a ‘price on quota’ to make it very nearly impossible for a young producer to start in dairy. Canada is also going toward mega dairies as they can afford the quota.
    – The use of “the market” always needs a reference to it being controlled by very few large corporations, thus for the farmer it is like a car owner trying to find a better price on gas, it doesn’t exist as one corporation follows the leader in setting the price.
    – Why is there still references to Russia interfering in the US election? After 5 months and still no evidence and many articles that they did not, the MYTH still exists. The only facts that did emerge was that the CIA used technology to make it appear that another country (always the US’s enemy) did the hacking. In fact it is well known that the US interfered in one Russian election (and in many other countries) but ignored by media. Oh yes, we are the good guys..
    – Why another anti Russian term “Thinktankistan?” Why not ‘Thinktankada’ or ‘Thinktankica?’ I do admit that it sure flows better, or does it imply the Russia’s are the only ones that think. Looking on either side of the 49th, sometimes I believe it.

    Reply
    • David Climenhaga

      April 25th, 2017

      I agree with you, Paul, about the complete lack of evidence to support the claims of Russian interference in the U.S. election. I was just being a smart-arse. As for Thinktankistan being an anti-Russian term, I have trouble with that concept, even though there were a few Soviet-era ‘stans. But I promise to think about the alternatives you have suggested. DJC

      Reply
      • Lars

        April 25th, 2017

        I believe that “-stan” is a middle-Asian word denoting “country” or “nation” (not sure which language), but its use goes back way before the beginning of the Cold War – vide Baluchistan, Afghanistan, etc.

        Reply
    • Val

      April 25th, 2017

      “The use of “the market” always needs a reference to it being controlled by very few large corporations, thus for the farmer it is like a car owner trying to find a better price on gas, it doesn’t exist as one corporation follows the leader in setting the price.”
      ——————————————————————————

      but in Canada such doesn’t exist. similarly to communist economy, where prices set by the government, we have cartel, named Canadian Dairy Commission, which set the price for wholesale purchase from dairy farms and retail price for general public. not further than last year “the butter crisis” showed marxist nature of dairy industry in Canada.
      size of your dairy business are only matter as far, as much you can fork out for lobbying own interest at CDC. it is not a market and far cry from healthy competition.

      Reply
  8. jerrymacgp

    April 26th, 2017

    “…despite his big talk, he hasn’t really done anything much at all since he was sworn in on Jan. 20….” I was watching CBC’s The National last night, and they had their Turning Point panel on. One of the panellists, Dr Samantha Nutt, pointed out an important tidbit of information: in all the bombast and noisy policy failures, Trump has been quietly turning back the clock on a number of fronts in the ongoing struggle between capital and society… emasculating the EPA, deregulating oil & gas, gutting CAFE regulations… It all makes me wonder: is all of the Sturm und Drang on Pennsylvania Avenue simply a smoke screen, a distraction, for these fundamental changes to American governance and society?

    Reply

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