The editorial page in the newspaper is consistently an interesting page to look over, if only for the political cartoon. This time I decided to read some editorials and was somewhat incensed with one about how price protection on eggs and milk in Canada is bad.
Their points were these: price protection increases the cost of eggs and milk, and is bad for trade.
Yes, price protection is bad for trade because other countries don't like it. On the other hand, many Canadian provinces produce just enough, if not too much, milk and eggs for themselves. Do we need more of these things imported? While I do not think importing these is the real trade issue, the impact that protecting farmers here have on other potential trading is real.
The author of the editorial explains that price protection was used to offer income security to farmers. I am all for income security for small farms. It is good if their revenue can cover their costs. Most people don't know that a milk producing cow produces milk for only about 6 months and has to be bred again before it produces more milk. That means that there are two shifts of cows producing milk over the year (twice as many cows as you imagined). Meanwhile, there are other costs like feed, taking care of non-producing cattle, breeding costs, medication, etc., and the only revenue these farms get to cover these costs is through milk sales.
Small farms can run cleaner and more organically than factory farms, which I fear a price decrease on milk would cause. Small businesses (farms included) provide more new jobs than large companies, so by extension, having many small farms means more agricultural jobs than having few large producers would. Not only that, but I think people get more satisfaction out of successfully doing their own thing which in this case is farming. As for price protection increasing the cost of our milk, the producer gets about 20 cents per cup of output (restaurants charge about $2 for the same). That's about $2.40 per gallon, not including that anything without a blue cow on the side is only 85% milk. I am okay with paying that much (plus plant and grocery store fees) for milk that I trust.
What really got me was the author saying that the only people who would care about price protection going by the wayside would be the 20 000 dairy/poulty farmers of Canada. This person, I think, forgets that farmers deeply affect the areas they live in. Farmers provide employment. Farmers donate with great regularity of both their time and money. Farmers buy stuff in town thereby supporting other employment. The point is, there are far more stake holders in the issue than 20 000 farmers. A decrease in revenue for farmers with a potential accompanied increase in competition hurts all rural agricultural communities, and if the author didn't notice, Canada has a lot of rural.