Special To The St. Albans Messenger Guest Column by Senator Patrick Leahy: A New Season Of Assaults On The Compact

July 2, 1998

The success of the Northeast Interstate Dairy Compact has encouraged other states to try to join our compact or to form their own.

Of course this is all very disturbing to the compact's opponents, and they are mounting an allout, bigbudget lobbying and advertising campaign to terminate or weaken the compact and to kill any other compacts in their cribs. The compact's opponents have delivered cowbells and cosmetic "compacts" to congressional staffers. They have carted free ice cream to Capitol Hill. They have splashed fullpage ads across Washington newspapers. All of this is timed for a new season of assaults on the compact through the legislative process.

These attacks are becoming increasingly shrill. They are being leveled by dairy processors and their consumer front groups who are incestuously wedded by corporate contributions. The arguments offered by groups like Public Voice for Food and Health Policy are tainted by hefty contributions from corporations opposed to the compact. They are pumping out voodoo analysis and tortured assumptions.

On our side, the record is clear. The Northeast Dairy Compact is doing what is was designed to do: give farmers a fairer return and offer consumers a stable supply of locally produced fresh milk.

Some consumer groups have argued that store milk prices have dramatically increased in New England since the compact's overorder premium took affect. Compact opponents have also argued that farmers outside of New England would be swamped with excess milk which would drive down farmers' prices outside the region. They also contended that federal nutrition programs in New England will be hurt because of the compact. And finally, they charge that the compact will stimulate excess milk production, causing a financial drain on the federal treasury.

Pure hogwash.

A recent analysis ironically, commissioned by compact opponents themselves conducted by the White House's Office of Management and Budget (OMB) once again knocks the wind out of the opponents' arguments against the Dairy Compact.

OMB found that consumer prices for milk after the first six months under the compact on average were 5 cents per gallon lower not higher than retail store prices in the rest of the nation. OMB could find absolutely no adverse affects for farmers outside the region. In fact, the report notes that some farmers outside the region did better under the compact by selling their milk into the region. And further, OMB found that the compact has not added to the federal costs of nutrition programs as compared to other regions.

Concerns about purchases of surplus milk by the federal government are similarly unfounded. More than 99 percent of all surpluses purchased by USDA this fiscal year, according to AgriMark officials, has come from the West and Midwest where compacts do not exist.

The key to keeping milk prices low for consumers is keeping farmers in business. And the only way to do that is to give dairy farmers a fair return for the milk they produce. On this, the record is also clear: the compact is working as it was supposed to. For the first time in a long time, we have sharply reduced the decline in the number of Vermont dairy farms. The rate of farm attrition is the lowest since 1991. Since January of this year, Vermont lost 35 dairy farms, the lowest sixmonth total since 1991. Thirtyfive farmers out of the business is still 35 too many. But considering the earlier trends in dairy farming, these reports confirm the need for and the value of the compact.

Compacts are sound policy and the track record of the Northeast Dairy Compact affirms this. States in the Southeast and MidAtlantic regions are on their way to adopting their own compacts. I will continue to assist their efforts in any way I can. Most importantly, we must fight off the efforts of those who would pull the plug on our own compact.

Opponents of the compact are loud, wellfunded and politically savvy. To counter their campaign we need everyone's help. Together we can make sure that the truth, and our compact, both live to see another day.