The on-going campaign on the business and political pages of our major newspapers to snuff out supply management continues. President Obama now has congressional approval to negotiate the final terms of what's called the Trans-Pacific Partnership, setting the stage for final bargaining over the next couple of monthes on an 11 country trade deal that includes important emerging economies in Asia and South America. The U.S., New Zealand, and Australia in particular want Canada to give up the high tariffs used to shield the regulated dairy, poultry and egg industries from cheap imports. I've written extensively about this over the last six years, and the search function at the bottom of the page will show you where those are if you wish.
While cheaper milk and cheese is held up as justification for getting rid of supply management, there are other factors that don't get as much attention, like subsidies and the environment. Yes U.S. dairy farmers are paid less than Canadian which is the underpinning for cheaper dairy products, but they’re also subsidized through government cheques in the mail. In Canada farmers are just paid once. Is there an appetite to add income support to put farmers here on the same footing if supply management disappears? I doubt it. And the size of farms needed to compete in ruthlessly competitive export markets has become an environmental problem in New Zealand, Australia and the United States. More than 50% of U.S. milk is produced on 3% of the farms, all with more than a thousand cows, and opposition is growing in states like Wisconsin after manure spills. “Dairy Industry Posing Pollution Threat To New Zealand's Rivers, Says Expert” is a recent headline in the International Business Times. Bigger not always better.
And this week more indication that the free market doesn't always bring the best results. And don't forget this is the export market the media elite think is just full of opportunity for Canadian dairy farmers.