Senator Calls Out House Failure on Farm Bill
U.S. Senator Patrick Leahy (D-VT) told the Senate Friday that milk market chaos will erupt if Congress doesn't prevent that 1949 law from going into effect in less than one week. Leahy says the failure to act on a farm bill or farm bill extension would set off a chain of events that could double the prices of milk and dairy products.
He says Ag Secretary Tom Vilsack and his staff have been literally dusting off old paper files and mimeographed notes from the 1940s and 50s to review the Agricultural Act of 1949.
Due to the lack of House action on its own bill and obstruction of the Senate bill - Leahy says the 1949 law will force the federal government to spend billions of dollars to buy and store dairy products in an effort to raise the price of milk for dairy farmers.
The law requires USDA to announce a support price for milk at no less than 75-percent of the ratio of milk prices to production costs in 1910 to 1914. November parity was 52-dollars and 10-cents for 100-pounds of milk.
The 75-percent would be 39-dollars and eight-cents - nearly four-times the current support rate and double today's market price. Leahy says higher milk prices would stimulate milk production - but also draw an influx of imported dairy products as processors in other countries would divert products to the United States.
Leahy points out USDA economists say implementing permanent dairy law would cost at least 12 to 15-billion dollars a year - not including the cost of product storage.
Basically - Leahy says USDA would have to fill every closet at USDA's building with cheddar cheese and powdered milk. He says the House leadership has driven the U.S. to the edge of the dairy cliff and is refusing to put its foot on the brake. It's a dangerous game of chicken - according to Leahy - dragging all Americans along for the ride.
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