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Thursday, December 08, 2005

There They Go Again: House, Senate Leaders Say Get Milk! Price Supports, That Is

Republican congressional leaders are trying to ramrod through an upcoming conference committee of the Senate and House resurrection of a costly milk price subsidy program that mainly benefits dairy farmers in the Upper Midwest and Northeast while keeping the price paid by consumers for milk at artificially high levels.

The refusal of the GOP-led Congress to eliminate these kinds of special interest subsidies is a major reason why federal spending is spiralling out of control and making the Porkbusters campaign in the Blogosphere all that much more important.

Citizens Against Government Waste has the goods on the GOP leadership's gambit, including this letter from five Amigos of the Porkbuster effort to House Speaker Denny Hastert, Senate Majority Leader Bill Frist and other members of the Senate and House leadership:

Dear Mr. Speaker:

On behalf of the undersigned groups, we are writing in opposition to the resurrection of the Milk Income Loss Contract (MILC) program (also known as the National Dairy Market Loss Payment program), which is included in the Senate version of the Deficit Reduction Act.

We particularly object to your plan to "instruct House conferees to secure an extension of a MILC program through September, 2007." Helping the dairy lobby secure this subsidy, rather than having an up or down vote on the program in the House, is a betrayal of the taxpayers.

When the MILC program, which expired on September 30, 2005, was created as part of the 2002 farm bill, the Congressional Budget Office (CBO) estimated that the four-year cost of the program would be only $1.3 billion. However, the program cost taxpayers more than $2 billion.

Now, CBO is estimating that a scaled-back two-year version of MILC will cost slightly less than $1 billion. If they are as wrong now as they were in 2002, this new two-year program could actually cost taxpayers closer to $1.5 billion.

There is no justification for a return of the MILC program. The dairy industry is already subsidized through the Dairy Price Support Program (DPSP), which cost taxpayers an average of $500 million per year from fiscal 1999 to fiscal 2004 for the purchase of surplus dairy products.

Demonstrating how ludicrous it is to have both of these programs, the MILC program subsidizes dairy farmer income through production-linked payments, which leads to expanded production and lower milk prices. Then, the DPSP purchases the surplus milk production caused by the MILC program.

We urge you to reconsider your promise to resurrect the MILC program in the Deficit Reduction Act. Taxpayers deserve respect, rather than be milked dry by back-room deals using deficit reduction legislation to create unjustified subsidy programs.


J. William Lauderback, Exec. Vice PresidentAmerican Conservative Union
Grover Norquist, PresidentAmericans for Tax Reform
Thomas Schatz, PresidentCouncil for Citizens Against Government Waste
Matt Kibbe, President and CEOFreedom Works
John Berthoud, PresidentNational Taxpayers Union

You should ask your congressman and senators what they think about this, too.