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Guest Columns

Perspective:
Industry Issues

A critical time for our nation and our industry

Connie Tipton

Connie Tipton is president and CEO of the International Dairy Foods Association. She contributes this column exclusively for Cheese Market News®.

Our economy continues to lag as market confidence has disappeared, and not enough has been done to sow the seeds of optimism about the future. Regulatory burdens on industries continue to grow along with the bureaucracy that supports them. Consumers are paying more for food as feed and fuel costs drive many product costs higher and higher. International trade policies keep people in the developing world in poverty by denying them a way to make a living and keep food on the table.

All of this limits our U.S. dairy industry’s opportunity for growth.

But we can play an important role in doing something about it by starting with appropriate dairy policy reforms that encourage growth and innovation in the U.S. dairy industry and at the same time give opportunity to other parts of the world to participate in the global economy so their incomes will rise and they can afford our products.

Everyone wishes we could bring policy ideas to Capitol Hill that are embraced by all in the industry, including us. But we can’t go along with policies that will lead us in the wrong direction. Rep. Collin Peterson likes to say, “IDFA agrees with 75 percent of the National Milk Producers Federation’s plan,” but that misses the more important point. We appreciate the effort to find common ground, yet overall the Foundation for the Future will affect the U.S. dairy industry’s future so negatively that IDFA recently voted to reject it.

Two parts of the NMPF package are simply unacceptable. The plan relies primarily on a “growth management” program, called the Dairy Market Stabilization Program, that will limit milk production and impede the growth of U.S. dairy production and processing. It will hurt exports, encourage imports and keep us from being consistent, reliable trade partners. All of this will keep producers and processors from expanding, and thousands of jobs for our struggling economy will be lost.

We are not embellishing the facts or opposing the proposal just for argument’s sake; this assessment comes from analysis done by the Food and Agriculture Policy Research Institute (FAPRI) and can be found on NMPF’s website. Our chief economist, Dr. Bob Yonkers, recently completed an economic review that summarized the analysis, and these facts, particularly on exports and employment, stand out. I urge you to visit keepdairystrong.com to read Bob’s eye-opening review in the Highlights section.

The NMPF package also adds complexity to the already complex federal milk marketing order system. We would rather follow the KISS principle ­— Keep it Simple, Stupid — and completely reform this system and phase out government pricing and pooling. Pricing provisions that may have been necessary during the Depression are now in the way of milk moving to its highest-value use, and they discriminate against a fluid-milk industry that has been dealing with consumption declines for more than 30 years.

There are so many areas where we have seen markets work better than government, and we think it’s high time to give it a try for our U.S. dairy industry. World demand is growing, and we are benefitting from new markets and market potential all around the globe. Fewer government mandates will free us for more innovation and technological advancements.

Getting back to Rep. Peterson, let’s work together to grow our economy, create more jobs and expand our international markets. Let’s get government out of the way, and give our dairy farmers and dairy businesses the risk management tools they need to manage price volatility like all other commodities are able to do. It’s time to make our farms and businesses sustainable in the marketplace, not through government programs.

Our paper outlining the policy initiatives endorsed by our boards of directors, “IDFA Dairy Policy Recommendations: Providing a Path to Growth and Opportunity,” can be found on www.keepdairystrong.com and www.idfa.org.

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The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

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