‘Artificially priced milk’

by Aaron Wherry

Conservative MP Brent Rathgeber considers the end of the Canadian Wheat Board’s monopoly and the future of supply management.

It is difficult to justify maintaining a sector of our economy that is protected from competition thanks to a government-sanctioned system that restricts supply to ensure a higher price.  There are 34 Million Canadian consumers but less than 14,000 dairy farmers, 3,000 poultry producers and 1,000 egg farmers.

Possible entry into the Trans-Pacific Partnership is going to necessitate a critical examination of supply management.  I do not represent any of the 14,000 dairy farmers who benefit from supply management; I do, however, represent 140,000 consumers of their artificially priced milk.  Their interest also necessitates a critical review.

As the grain farmers near Kindersley can attest, grain and beef farmers in Western Canada have proven that they can successfully compete without a government-sanctioned cartel.

In their campaign platform and Throne Speech, the Conservatives vowed to continue to support and defend supply management.

All previous supply management coverage here.




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‘Artificially priced milk’

  1. I agree on that….no fair just picking on western farmers. Sauce for the goose etc.

  2. Completely, 100% agree.
    Unfortunately, I expect him to issue a press release by next Tuesday falling in line and defending supply management (… hey, it is a long weekend coming up…).
    Commenter Yanni: if what you said about western farmers is true, it is incumbent on you to back up Mr. Rathgeber when he inevitably gets beaten into submission and toes the party line on supply management.

    • Well, it is interesting to note that it is a Albertan MP saying this, rather than an MP in one the 6 Quebec ridings, or in Ontario. When he gets beaten back into submission, it will be from MP’s in the Atlantic provinces, Quebec and Ontario that do it.

      But yeah, it is a cartel that distorts the market and favours those “made men” who have a quota. How distorted does the quota system make the market? Well, let’s put it this way. A neighbour of mine got a divorce. He kept the house, the cars, the equipment, the livestock, the land, and the liquid cash. She got the quota, and it was a 50/50 split of assets. I’m sure the value of the quota has only appreciated in the 10 years he has been a beef farmer.

  3. As the grain farmers near Kindersley can attest, grain and beef
    farmers in Western Canada have proven that they can successfully compete
    without a government-sanctioned cartel.

    ***

    The wheat board has been transformed into a taxpayer funded price insurance system for less than three days (one a weekend) and this guy calls it a successful enterprise in free marketing? That’s not just dumb, it’s dangerous.

    • Um, marketing sans-wheat board is not exactly new. Ontario farmers have been doing it for years with no issues. To expand that to the West, I don’t think it’s unfair to say the results out west would reflect that already experienced in Ontario.

      • …grain and beef farmers in Western Canada have proven that they can successfully compete without a government-sanctioned cartel.

        …marketing sans-wheat board is not exactly new. Ontario farmers have been doing it for years with no issues.

        Ontario’s not part of “Western Canada” now, is it? LOL

        Not that you don’t have an excellent point, but you’re still saying that the results WILL show that, in the future, Western farmers will have no more problems than Eastern farmers have had in the past. It hasn’t technically actually BEEN shown yet after just three days (though I too suspect that it will).

        (/pedantry)

        • My comment was really narrowing in on his ‘That’s not just dumb, it’s dangerous’. As you say, it is way too early to measure the effects of eliminating the monopoly. And in just the same way it is too early to call its demise a success, it is certainly too early to call it’s demise “dangerous” also.

  4. Costco on the lower mainland 4 litres $4.45 CAD

    Costco in North Washington 3.87 litres $2.42 USD

    The CON has a point but he won’t do anything about it because the CON base would never support dairy competition.

  5. It is great to see a member of parliament with the courage to stand up to the Supply Management Lobby. This system of agriculture production represents a hidden tax on staple foods such as milk, chicken and eggs which is estimated to be in the order of 60%. When you see people complaining about HST and/or GST taxes just think what an uproar these Supply Management taxes would generate if they were visible.

    You don’t need to be a farmer to understand that restricting supply, enforcing inefficiencies, limiting innovation and preventing domestic market access with expensive entry fees (quota) is going to increase consumer prices – That is what Supply Management does and it is the poor consumer who pays the price.

    Scare stories about preventing the import of poor quality foreign food have no substance and play on consumer fears – Canada already imports 7% of chicken and exports about the same amount. Ironically, those chicken exports are subsidized by the Supply Management System because cartel farmers produce at one price for the domestic market and another much lower price for the export market. These export chickens are of course grown in the same barns as their domestic counterparts but they are sold for a lower price (because nobody outside of Canada would pay our high domestic prices).

    So what does Supply Management achieve for Canada? It makes a few cartel farmers very rich and very happy and so far most of our politicians are either milked, plucked or feathered into believing they are doing something good for Canada – Shame on them for behaving like Sheep (which fortunately do not fall under the Supply Management umbrella).

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