Forty years ago Walt Kelly’s Pogo, our favorite possum, commented that “We have met the enemy….and he is us.” This certainly applies to the U.S. dairy industry, which just can’t seem to stop producing more than consumers are willing to consume. That’s because farmers make decisions based on what’s best for their operation, not what’s best for the industry as a whole. An empty stall is a no-no, and if there is some modest trimming of herd size (often simply reducing overpopulation of free stalls), the result is more bunk space per cow and more quality forage to go around. The result of which is—voila!—more milk per cow. And that’s just what has been happening of late.
A USDA’s effort of many years ago was to pay farmers to trim herd size without necessarily eliminating herds. The idea was to cull the bottom of the herd, and if a farm reduced milk sales by at least a certain amount the farm would get a payment from USDA. Sounded good, and many herds did so. But a year or so later there were all those empty tie stalls (or underpopulated free stalls) and a bunch of springing heifers ready to fill them. Which do you think would produce more milk: A cow at the bottom of the herd or a fresh heifer? And of course the heifer is is almost always genetically superior to the cow the farmer culled. Therefore, this attempt at curtailing production was a dismal failure, and the USDA’s next attempt, a few years later, was more draconian:
Namely, the Dairy Termination Program (AKA “The Buyout”). This one eliminated whole herds of cows, preventing both their sale to other U.S. dairy farms and the farmer from restarting a dairy on the same farm, at least not anytime soon. (Farmers could sell their herds for dairy purposes to farmers in other countries. In Northern N.Y. this meant Canada, of course, and that’s what some Buyout farmers did.) Farmers accepted into this program, based on competitive bids, would be paid so much per hundredweight of milk for “permanently” exiting the dairy business. Sounded good, especially to farmers nearing retirement who were going to sell out in a few years anyway! Therefore, the list of participating farms looked much like an AARP mailing list. (In Clinton County, for instance, where I knew just about all the farms accepted into the program, about 90% of them were in this category.) And for some of the farmers who didn’t retire, “permanent” turned out not be not so permanent after all. They grew and sold crops until the program’s restrictions permitted them to go back into dairying. The immediate effects on milk production were more significant than for the previous program, but transitory—as all such programs are destined to be.
Is the solution Canadian-style supply management? Hmmm. This is looking better to a lot of nearly destitute dairy farmers, but would represent a huge change for the U.S. dairy industry, and not one that would easily be undone. But it might be the only one that dairy farmers can’t doom to failure by the simple act of trying to maximize economical production on their own farms.