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Sour Milk

It is illegal in Maine for retailers to sell 6 gallons of milk and give away a 7th for free.  The hubris behind the whole program (similar ones operate in many states) is astonishing. The grocery store had to go to the milk czar to ask for permission to offer an in-store promotion. Under what definition of private property rights are we operating anymore? If the thugs in the Maine Milk Commissar’s office and the dairy farmers had an issue with the stores doing this, could they simply have decided to not sell their milk to the supermarkets? Pre-semester bonus points for any student: show what this milk program does to overall economic welfare, and show who gains, who loses and by how much. Extra, extra credit: explain why obviously destructive and unfair programs continue to exist and are unlikely to go away?

One Response to “Sour Milk”

  1. Harry says:

    It goes back to the depression, when commodity prices collapsed, and progressives saw an opportunity to get the votes of crop farmers. The idea was that wise men in government could solve the problems created by other wise men, some of whom were perfessers in land-grant colleges.

    Voilà! The USDA, and assorted state bureaucracies like the Pennsylvania Milk Control Commission. All my life government has had their dirty fingers in the milk can.

    We were in the business, so that was the river in which you swam. Perhaps it is a rationalization, but hardly any dairy farmer had the time or inclination to challenge the system. Federal milk marketing orders dictated prices, and thereby provided incentives to get your cows bred in the wintertime.

    This may have piqued wintercow’s interest, ears moving forward.

    The reason for this policy is that not enough farmers let their cows out of the barn and bothered to catch heats; thus a dearth of fresh cows in September.

    This and numerous other schemes were sold to farmers hoping to get higher prices.

    Back in the late ’70’s I remember reading an article by a Louis Longo in the Hoard’s Dairyman. He wanted to abolish the Department of Agriculture and let farmers and dairies sell at a price they could fetch.

    After all, Coca Cola never had a cabinet department put it’s dirty fingers into it’s flavored soda water.

    Why is such foolishness so persistent? It’s been going on for ninety years. Whole generations have played the game, which is similar to getting a good apartment in St. Petersburg, Russia.

    Also, there are many people who should not be in the business who are due to cheap credit, price supports, and undercapitalization.

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