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Letter to the Editor: Milk price 'cure' is worse than the disease

Alan Kozak Published on 29 February 2012

Dear Editor,

Taxpayers on the hook for $3 billion to push small dairy farms out of business?

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The proposed cure is worse than the disease. The disease is farm milk price volatility and ongoing narrow to negative milk-to-feed margins that have crippled many dairy farm businesses. The proposed cure is the Dairy Security Act which was introduced by Rep. Collin Peterson (D-MN).

The Dairy Security Act was recently analyzed by Mark Stephenson from the University of Wisconsin-Madison. Stephenson’s analysis indicates that the Dairy Security Act would reduce dairy farm income, reduce exports, increase the rate at which smaller farms exit the industry and cost taxpayers more than $3 billion dollars over the five-year life of the proposed legislation.

Federal dairy policy needs to be simplified. Market distorting programs such as the Dairy Product Price Support Program need to be eliminated. The Federal Milk Marketing Order system needs to be changed to encourage competition among buyers.

Interest in LGM-Dairy has exploded beyond its funding. Funds that currently support MILC could be used to grow the LGM-Dairy program.

The U.S. dairy industry needs to improve price discovery and market transparency. The Dairy Advancement Act, introduced by Senator Robert Casey (D-PA), accomplishes all of the above

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Dairy farms, even the small ones, are an important part of our local, state and national economy. We need federal dairy policy that will allow dairy farmers to succeed without being a burden to taxpayers.

In my opinion, the Dairy Advancement Act, S. 1682, is the right choice to accomplish these goals.

The 2012 Farm Bill is being (or already has been) crafted. Unfortunately, the Congressional Budget Office (CBO) scoring puts the Dairy Security Act at a favorable number for the budget, but the financial risk to the taxpayer is far greater than the projected cost.

It would be like being asked to agree to repairs on your car that will probably cost $1,000 but maybe as much as $5,000.

Hopefully my Ohio U.S. Senator Rob Portman, and the others, will realize the shortcomings of the Dairy Security Act and openly explore solutions, including the Dairy Advancement Act, that will better serve all parties. PD

Alan Kozak
Dairy producer
Millersburg, Ohio

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