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DON'T HAVE A COW

Holy Cow: 'Milk Cliff' Narrowly Averted

Milk prices won't double in new year now that Congress passed a fiscal cliff deal

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by Lisa Fine

Staff Writer t

Image: AP

Put down the powdered milk. It looks like milk prices won't rise to $7 a gallon after all.

The nation has escaped going over what the dairy industry named the "milk cliff" now that Congress has passed the fiscal cliff deal that contained a last-minute extension of parts of the 2008 Farm Bill.

The legislative patch will keep dairy cases safe from price hikes through September. It's a temporary fix and puts off decisions on an entirely new farm bill that is needed since the old one expired in September. The Senate passed a full version of the bill in July, but a House version never made it to the floor because of disagreements over issues including how much money should be cut from food stamps, USA Today said.

Without the action from Congress, an antiquated dairy pricing formula would have kicked in. This system was based on production costs in the 1940s when everything was done by hand. The formula would have forced the government to buy dairy products at roughly twice the current market price, which would drive up costs for everyone. Milk sells at an average of $3.65 a gallon, the New York Times said.

The higher prices might have forced consumers and the makers of dairy products like butter, cheese, and yogurt to seek out cheaper alternatives like soy milk or cow's milk imported from other countries.

Via the NewYork Times and USA TODAY
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Are you disappointed Congress did not pass a full farm bill?

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Comments (view in Forum)

  • justapirate
    !
    If the comedic relief in Washington had attached a full farm bill it would have been a knee-jerk type of thing with no thought given to what was actually in the bill and no one would have time to read and/or understand what the heck they did this time.
  • Your_Name_Here
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    I'm not sure why we need a farm bill. How about if farms produce and sell at market price? Novel concept, isn't it? Does our federal government think we should be buying milk for each other? Got milk?
  • Mia
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    I am disappointed in congress and the whitehouse because they are completely lacking in integrity and courage. I have no faith in most of them to fix anything.
  • Dan_Tien
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    How about passing a bill that allows the government to buy milk at the current market value without filling it up with additional clutter like additional farm subsidies, food stamp issues, or provisions to pay dairies not to raise cattle?
  • Dan_Tien
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    @WilliamWallace As Congress is wont to arrange things, passing no bill looks like it would cause the government to be required to buy milk products at a high price because of existing legislation. So how about telling the government to get out of the milk buying business altogether as part of spending reductions? The reason for the Dairy Product Price Support Program is to keep the market price of milk products high. Eliminating the program might cause large dairies to go out of business due to market driven prices going down, but then those large capitalist ventures are being propped up by what amounts to a socialist program.
  • View all 20 replies >
  • justapirate
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    I've long thought the government needed to get out of farming and let the market work. Unfortunately, farming ain't what it used to be. Big corporations have taken fair market value out of the eqation.
  • jessejaymes
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    @texas_cutie75 Disagree. An alarmed public is a grateful public when they don't have to get off their asses and actually do something about our Politicians.
  • Dan_Tien
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    @texas_cutie75 Would a comfortably secure nation have allowed the quick passage of the Patriot Act with so little protest?
  • u
    mtkopf
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    They haven't even been sworn in yet. At least save your skepticism til Friday morning.
    Personally I think the 113th will be the most bipartisan Congress in the history of our nation.
  • PNWest
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    The 114th should be better. People are wising up to the crap that the tea bag reps are pulling and pulling away from them in droves. With the GOP base dying off and the dem supporters growing in numbers the cart is about to topple on them. 2014 will be better for dems than most mid term elections and 2016 is looking great as long as Hillary recovers.
  • DARSB
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    @PNWest I hear you, but I'm not willing to project any candidate at this early date. Hillary may decide she's overdue for a private life, who knows? Let's see what she says after the blood clot near her brain is not an issue.
  • PNWest
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    @DARSB True that. 2016 is a long way away. The GOP did show a bit of sanity in the last day or so but I still think the baggers are in control of the GOP and they'll continue to self destruct. There is an awful lot of right wing anger to all of the GOP representatives that voted sensibly. This should push the GOP even further to the right which will accelerate the party's decline. The only way the GOP can grow is if they can conquer there extremists on the right. I don't think they'll be able to do this.
  • View all 6 replies >
  • Your_Name_Here
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    A more appropriate method of improving the economy is to have all the farmers take over all the elected positions in government. The vacating incumbents are invited to new positions shoveling manure out of stalls since they have a lot of experience doing just that. The incoming farmers know how to put in a full days work for little in return, they know how to plan ahead, they know you have to work within your budget and they know money not earned has no value.
  • o
    woodtick57
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    Would these be the same farmers that call for small gov't and brag about their self -reliance all the while living off a gov't subsidized industry? Sounds like they would fit in perfectly with the Beltway crowd....
  • o
    woodtick57
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    Not sure where everyone keeps getting this $7 or $8/gallon figure. the amount paid to farmers is at most half of the cost of a gallon. prices would havve risen from $1.25 to $1.50 per gallon. You'd think the media would actually check the numbers on the hype they put out...
  • PoliticalSpice
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    Why would you think the media would check anythink, if they didn't check claims of weapons of mass destruction before plunging the nation into war, why on earth would they care about the facts on milk?
  • View all 9 replies >
  • Buzzfriendly
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    Why the hell does the government need to be involved in this anyway? Anytime you add the government to the equation this is the type of mess it generates. Have to quote Reagan here "In this present crisis, government is not the solution to our problem; government is the problem."
  • PayThatCEO
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    Sad thing is...it's not "new". It's been coming to this point for a very, very long time. We have no one to blame but ourselves for waking up too late. We should have listened when those words "New World Order" were spoken for the first time.
  • jessejaymes
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    Milk might jump initially without price supports but in the end it would be a free market based on supply and demand. This is not 1940. Little kids are not going to grow up with deformed bones without Milk. In fact most little kids after bottle weaned do not even like milk in today's society. I've asked over the past few months. Asked relatives kids, asked kids and parents in grocery lines. It's time to stop artificially controlling farm product prices. 90% of farming today is corporate farming which makes govt subsidies for farming just more corporate welfare.
  • Thegrif
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    Republicans only had one thought, "No Tax Increase", but no real alternate plan, and no freakin balls either.
    I would have told Dem's (Obama), we will give a dollar in tax increase for every dollar of spending cuts you put on the table. I would scream that offer from the tallest building, for the world to hear,
    "Mr. President, we are willing to match you dollar for dollar."
    Now that is fair, and if Obama don't except that deal, then his ass can hold the bag for goin over the cliff.
    But, they caved in, cause they couldn't come up with what I just told ya. Holy Cow, we are in trouble America, cause we got freakin idiots running the show.
  • Politicskid
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    Okay, Thegriff here's some great spending cuts the president should really consider. They all put us in the red:

    Medicare
    Social Security
    Medicaid
    Food Stamps
    Unemployment Benefits

    Try telling Obama to cut any of these things by one penny. Good luck.
  • Thegrif
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    @Politicskid well after all that Obama Hype, calling for tax increases, being unwilling to really negotiate, he had to have that tax increase and he didn't want to hear anything else. What does Obama say today? " the tax increase, by itself, will solve nothing."
    Well duh! So why didn't he sit down to seriously negotiate? Thats what the Prez is suppose to do, facilitate the coming up with a real working plan. Do some research people this tax increase will amount to 600,000 less new jobs, you think employers are going to hire more with this tax increase, nope.
    You think owners of companies, rich already, are not going to close doors and put employes on the street? You better think again. So, I got enough money to live comfy for the rest of my life and my kids life, so why don't I just close up shop, take all my money, and benefits I give or afford my employees, kick them to the curb with their less than 2 wks food in their fridge and livin pay check to pay check? Yea I am out and you would be too.
    Hell, times are tough, toughin up America, cause I would cut all those things, and cut every non American living in America out too.
    Just one of yall let me know when Obama gives you something, cause I will put my hand out too, I will live off the system too, cause I got all my money buried in the back yard in mason jars, and I will quit workin and soak the system, this will be great for me, for as long as it last.
  • Thegrif
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    @PayThatCEO hell I would cut everything people are scared will get cu., Sorry America, but thanks to our lovely political machine, its time to tighten up the purse strings and cut, cut, cut spending. Some will be unhappy and pissed cause their check is getting cut or their benefit is now gone altogether, but thats the way it goes and has to be. Really, emotionally I would love to let people sit home and live better than many of those working, but we can't anymore. America is sinking fast and logically we are not about to sacrifice our nation so you can live off the system.
    We will not sacrifice the many to save the few.
    Sounds harsh, I know, but the path we are currently on ends at a nasty reality.
    Toughen up, a very harsh reality is coming.
  • mimi57
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    I really believe this administration does nothing but use scare tactics and threats, everything is a 'crisis'...but
    didn't Rahm say; "You never let a good 'crisis' go to waste"? They seem to be creating them faster than we can
    say the word...
  • u
    tomincali
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    the local dairy farmers here said that the price of milk going up to 7 or 8 bux a gallon was nonsense. with milk sitting on the store shelf unable to sell would have been a huge loss . more gov nonsense to scare anyone who would fall for it.
  • u
    CommonSense
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    Subsidies may have a place if used correctly. There is a natural tendency in markets to cartelization.
    So it follows that subsidies should go to small businesses, whether industrial, service, or agricultural. But we don't need to give free money to big business.
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