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Tuesday, January 25, 2011

With Conservatives Like These...

A Conservative politician's dilemma: Fight for free markets? Or appease voters in rural Quebec? No prizes for guessing the answer:

This should be a pivotal moment in Canada’s irrational defence of supply management. There are signs that countries like Japan and Korea are prepared to undergo structural reforms to their agricultural sectors, in exchange for a seat at the TPP table. If all the members of the Asia-Pacific Economic Co-operation organization sign on, it would mean a free trade deal encompassing half the world’s economy. Yet Canada, an APEC member, remains hostage to 7,500 dairy farmers in Quebec and 5,000 in Ontario, accounting for less than 1% of the Canadian economy.

All part of the cost - borne by ordinary Canadians - of Stephen Harper's quest for a majority government. Higher prices for Canadian consumers. Reduced opportunities for Canadian workers and entrepreneurs. 

We are solemnly taught that principles don't always make it into practice, especially in politics. Having ideals is nice. Like eating a balanced diet and calling your mother. In the real world, people get themselves all busy and distracted. Awkward compromises are necessary. Don't let the perfect become the enemy of the good. Etc...

This has a nice, practical and hard headed ring to it. Idealists are never going to make it in the real world. The alternative is far worse. A reasonable compromise is necessary.

Your humble correspondent is all for reasonable compromises. Too often, however, cowardly surrenders are passed off as sensible compromises. The good comes to be seen as the enemy of the quick fix.

It is not reasonable to deny Canadian businesses and workers - numbering in the millions - opportunities at vast new Asian markets, simply to appease a few thousand central Canadian farmers. It is nothing more than short-term political bribery. Compromising principles that work - free markets - for short-term political gain, is not the art of the possible. It's going for the laziest option available.

Such bribery works politically because it rests on the ignorance of the electorate. Most Canadians have never heard of government backed supply management. They just buy milk and cheese at the local supermarket. Their thinking goes no further than this. 

Admittedly, dairy marketing is not the sexiest topic in the world. Neither is fraud or chemistry. Yet both are shown nightly in Canadian living rooms. Watch any television investigative journalism program. Lots of coverage of crooked user car salesmen. Plenty of stories on chemicals that might be harmful to children and small animals. The occasional financial advisors who ran off with his clients money. The type of stories that require little imagination, less attention and plenty of emotional shots of crying middle aged women. They know their viewers.

Behind each of these types of stories are complex issues. Carefully presented they can be made simple and comprehensible to many millions. Few journalists will bother making the effort. Who wants to take on Canadian dairy farmers?

What Canada needs desperately is its own John Stossel. A television - or You Tube - correspondent who is willing to slaughter some of this country's most sacred cattle herds. We have some good print journalists and bloggers. However, they reach only a small minority of Canadians. Exposing the political fraud of government backed supply management - along with Medicare, Equalization and many more - is far more important than chasing down car salesmen.

Posted by Richard Anderson on January 25, 2011 | Permalink


The biggest losers in all of this, besides Canadian consumers, are other Canadian farmers. The ones who actually export their products around the world and who have to face supply management like tariffs before they can get those products into a lot of countries. Freer trade around the world would be a Boone to the vast majority of our farmers, but they are being held hostage by a small group free loaders who believe it is their god given right to gouge consumers.

And if it wasn't for those Quebec dairy outfits I don't think the wheat board would stand a snowballs chance in Hades of keeping its legislated buying monopoly over western farmers.

Posted by: Farmer Joe | 2011-01-25 8:59:13 AM


How dare you suggest that the Conservatives actually roll back the politically inviolate ratchet of Leviathan. If accomplished, even on a microscopic level, that could destroy my cynicism.

Speaking of Stossel, are you going to be auditioning / lobbying, or applying for a spot on Sun TV News?

Posted by: John Chittick | 2011-01-25 11:18:24 AM

I wonder how many supply management farmers even vote conservative. Why would they? The Liberals and the NDP would seem like a much better fit for them.

Posted by: Farmer Joe | 2011-01-25 11:32:11 AM

First best would just be to abolish supply management. Can't see any Canadian political party with the balls to try it though. Second best: Buy them out. Pay the bastards off. Give every quota holder some bonds, then put a new tax on dairy products to pay off the bonds; sunset the tax so it ends when the bonds are paid off. It won't be cheap. But it'll be less bad than what Canada now has and it'll make it possible for Canada to stop looking so retarded in trade negotiations.

Posted by: Eric Crampton | 2011-01-25 1:36:02 PM

It's easy to see we are screwed with every purchase when the milk quota is worth far more than the whole farm. Free enterprise ???. Not in Canada.

Posted by: peterj | 2011-01-25 10:37:37 PM

Read a good line on another Blog about this topic,

"Canada has got to be the only place in the world where it is cheaper to eat the cow than drink its milk."

Posted by: Farmer Joe | 2011-01-26 2:05:28 PM

You said it right on Farmer Joe, pork, beef, other meats and grain guys have to suffer while chicken and dairy producers are in paradise. Plus consumers in some cases have to pay double of what americans pay for their dairy products. Sure beef and pork guys had the chance to get quota but that was 30 years ago and this system of quota is out dated for young farmers, the next generation is here and we need new blood, they have the skill and education to be their own marketers, no need for milk or chicken marketing boards plus they can't afford $5,000,000 quota not mention the price of barns, equipment and land (which is also stimulated by quota industries) to start a decent sized dairy or chicken farm and on top of that this quota is not really a hard asset like land so in other words it's just really expensive paper. And in my opinion the new producer program that the milk board is proposing is a load of bull crap, what young person can make living off 30 cows of leased quota which they have to purchase eventually and still generate capital fast enough for future expansion. Lastly, I always hear that quota saves tax payers dollars because farmers with quota don't need bail outs, I counter that with, Dairy and Chicken marketing boards make billions of dollars on fees each year just to lobby the gov. to keep quota and the $$$ amount of marketing fees is just about equal to the gov. bailouts and farm grant programs that the gov gives to non quota producers so their really is no gain, in my opinion those billions of dollars should be put back in the pockets of our consumers so that they could spent it on products and services that create jobs, plus without quota the dairy and egg industry can expand into the growing world markets for chicken and dairy products thus creating even more jobs in the dairy and chicken industries then their is now. Only ones to lose are the ones holding the fancy expensive paper and I don't care one moment for them and I as young farmer I will be in line when quota goes to enter the dairy industry after all I will be able to produce milk 20 cents to the dollar compared to produces with quota thus we can be competitive on the world stage as well as in local markets, because the world is bigger then our backyard now a days.

Posted by: agricon | 2011-02-07 6:58:04 PM

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