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The Message

(March 20, 2002 – CropChoice news) – We are re-running this piece by dairy farmer John Bunting with his permission. In "The Message," Bunting rebuts a study attacking the Northeast Interstate Dairy Compact, which expired on Sept. 30, 2001.

The Compact had helped family dairy farmers in the Northeast remain competitive by requiring that milk bottlers, not taxpayers, pay into a fund to maintain a floor on fluid milk prices. For more information on the Compact, visit http://www.dairycompact.org/press.htm

By John Bunting © 03 02

Blind and naked Ignorance Delivers brawling judgments, unashamed, On all things all day long. Alfred Tennyson (1809–1892)

There was only one truth, went the message, and it always preached as fact that consumers paid extra because of the dairy compact. The message was heard everywhere from the halls of Congress to unending references in newspapers. Wading through 353 pages of "Generic Environmental Impact Statement on Animal Agriculture in Minnesota" (June 29 2001) we find:

"The higher farm level prices are passed to the consumers in the price they pay for fluid milk. ………. The estimated impacts on a non-compact state are: reduced milk marketing due to a price decline, a reduction in the federal order blend price, small increase in fluid milk consumption with a small decline in price, and a total market reduction in the revenues paid to farmers and collected from retail sales (Bailey 2000)." [Page 63]

On June 1 2001 Ken Bailey of Penn State produced yet another in a stream of papers on the dairy compact, "Impact of the Northeast Interstate Dairy Compact on Consumer Prices for Fluid Milk" [Staff Paper #341]. Bailey uses what he calls a "standard markup model" and on page 5 states, "The data also indicates that the retail price of milk does appear to rise and fall with changes in the Class I cost of milk."

Is this the gospel truth? Hardly. The compact ended September 30 2001. The retail price has not fallen yet. January and February of 2000 and 2001 the price for Boston is identical at $2.99/ gallon, even though farm price has fallen $.34/ gallon [source: International Association of Milk Control Agencies – Supermarket Milk Price Survey].

Interestingly, retail skim milk price in Boston is identical to whole milk price. On page 10, Bailey labors on about, "difference between the retail price of milk and the cost of milk". If that were true, skim milk should have been given away for most of 2001. On page 9 Bailey illuminates us with, "retail prices for whole milk generally rise and fall with retail prices for other kinds of milk, although large rises in butterfat prices could alter the relationship between high fat and low fat milk prices." Well, not in Boston but, in Rutland Vermont skim is often a couple cents more than whole.

In an article in the Journal of Extension (February 2002) Bailey says, "Extension personnel often have a much more detailed understanding of the complex issues facing their constituents than their research colleagues, who are increasingly focused on more basic research." And in the next paragraph, "However, care must be taken to conduct these studies in an objective and scholarly manner without unnecessarily alienating affected stakeholders."

In fact, the truth is that Bailey has not demonstrated an understanding of the complex issue of milk pricing. His study assumptions are a denial of complexity. As for the "objective and scholarly" there is no searching for the truth there. The price range in Boston for any one month is over a dollar for whole milk gallons. The difference between Boston and Rutland Vermont is about twelve cents. At the Abbey restaurant in Enosburg Falls, Vermont all milk is free as a tribute to local dairy farmers. So there is a goldmine of scholarly and as yet untapped research, not the least of which is consumption data on free milk.

But it is not about truth or scholarship or any of those things. It is about the message. That message was conceived by a team from M&R Strategic Services lead by Alan Rosenfeld. The message is enshrined in a tent of lies. Here is what Connie Tipton of International Dairy Foods Association has to say:

"M&R ranks as one of the best firms we've worked with in Washington. They are genuine and passionate about their work and it shows. Their expertise—from message development and strategic planning to communications support and economic analysis—was truly invaluable."

The message is not the same as you might find in a tent revival meeting where a freewill offering is collected.

This message comes from a religion which demands sacrifice. Both the Midwest and the Northeast will be required to offer up their family farms and rural communities as sacrifice. Some will offer up their first born. Even then we cannot know if that will be enough to please the Gods of crony capitalism.

1. All Bailey is at: http://dairyoutlook.aers.psu.edu/reports/NECompactStudy.htm

The first study at U of Missouri was funded by IDFA ($15,000)

2. http://www.mrss.com/f_client.html