A new report from the American Enterprise Institute (AEI) says that supply management initiatives currently being discussed as part of a farm bill would be detrimental to U.S. interests. The report, “Market Structure and Competition in the U.S. Food Industries; Implications for the 2012 Farm Bill,” concludes that a dairy supply-management program proposal introduced in both the House and Senate, which is likely to be considered for the 2012 Farm Bill, would increase consumer prices, increase milk production costs and diminish U.S. competitiveness in dairy products in the world market.
The paper “examines the potential impacts of several current initiatives to expand regulation of the food industries with the overall goal of increasing competition and commodity prices farmers receive. However, many of these initiatives will probably have the unintended consequence of raising consumer prices and lowering farmers’ prices while reducing the quality and variety of food products available to consumers.”
Grover Norquist's Americans for Tax Reform, Citizens Against Government Waste and the National Taxpayers Union have teamed up in their opposition to a proposed program that includes government mandated supply controls on dairy production.
"We, the undersigned organizations, representing millions of taxpayers nationwide, write to express our opposition to the inclusion of a controversial new Dairy Market Stabilization Program (DMSP) in the upcoming 2012 Farm Bill. "Our organizations believe that DMSP is contrary to the goals of limited government and economic growth. A new federal program that will directly intervene in markets and increase milk prices for everyone is unnecessary. "