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Senior Advisor

Say Cheese

USDA is buying $20 million worth of cheese.  The milk people wanted them to buy $150 million.  Some is better than none, or is it too little too late for milk producers?

 

Why not let the market decide?

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9 Replies
Honored Advisor

Re: Say Cheese

Butter @ Fareway yesterday $4.49

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Advisor

Re: Say Cheese

Sure. Like grain and oilseeds.

 

Maybe subsidize the first 40 cows?

 

100 might be a more realistic modern number.*

 

I always thought this was cool.

 

http://www.progressivedairy.com/topics/management/what-makes-a-millionaire-model-dairy-farm-successf...

 

There is probably some broad public interest served in maintaining some family sized farm. Beyond that, let the market decide.

 

*so what is fundamentally unfair about a 100 cow dairy getting subsidies and a 2000 cow dairy getting subsidies for 100 cows? What I guess might be unfair, or at least unwise, would be for a 50 cow dairy getting the same.

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Honored Advisor

Re: Say Cheese

Fairness is a good welfare concept.

Bid for it.
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Advisor

Re: Say Cheese

Sounds like a fundamental tenet of Brownbackinomics.

 

I don't know if there is a  compelling reason to subsidize dairy at all but do believe if there is it is to support family sized farms, not multi-thousand cow operations.

 

I'm comfortable there will be enough milk and cheese either way.* Actually, like hogs, once they get big enough they even tend to stay in production regardless, just move to different ownership after the equity of the previous owners get wiped out and maybe the lenders take a bit of a haircut and somebody else takes over.

 

That's a problem for free market economic theory, as it assumes the market forces some liquidation when faced with oversupply. In that case, yes, the little guys, who are more convenient to liquidate.

 

Some similarities to the conversations here about crop subsidy caps. People tend to get impatient and frustrated and just tilt to an ideological default position- oh, just get rid of all of them. Or leave them as they are.

 

Both extremes probably just accelerate the present trend to consolidation. It's hard to help horses that are hell bent on beating each other to the glue factory.

 

*Under some circumstances it might run contrary to the vision established in the USDAs 1995 blueprint for agriculture- that the US needed to become the world's low cost producer of value added commodities and rural development would be a function of exporting all that cheap stuff. As per the conversation at business regarding the state of rural communities I don't think the latter point has really lived up to billing.

 

As far as dairy goes, with the exception of NZ which enjoys some natural cost advantages, no erason why we shouldn't be able to competitively export some surplus.

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Honored Advisor

Re: Say Cheese

Really ,,, your welfare slip is showing.....

 

It makes no difference on the affect on the market if they buy it from the smallest dairy or the biggest.

It just reduces available supply and hopefully supports the market a little...

 

It is sad the price of dairy products...... It is obviously under consumed...

 

Maybe dairy needs to introduce a 44 oz flavored milk soft drink  with 5% alcohol

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Veteran Advisor

Re: Say Cheese

SW   -  you  are a  marketing  genius  -  I'd   say  ( 150 )  mark on that one - although you include include some electonic gizmo device maybe or a rewards card deal Smiley Surprised

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Honored Advisor

Re: Say Cheese

Caffenate it .... call it "RED COW"

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Senior Advisor

Re: Say Cheese

Good one Hobby - Or Moo-cahol  put in a Wisconsin angus colored can : )

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Veteran Advisor

Re: Say Cheese

Be careful of copywrite infringement.

Wife and I were at the Spotted Cow brewery in New Glarus, WI yesterday.

Good stuff - especially liked the Staghorn!! Smiley Happy

 

 

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