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Thursday, May 24, 2007

House Ag Bill Don't Got "MILC"

Admittedly, as a free-market conservative from Wisconsin's Dairyland, I've always been torn on the Milk Income Loss Contract (MILC) program.

It's another one of those classic government fixes meant to fix a problem actually caused by another government program. In this case, the insane Milk Marketing Orders of 1937, a New Deal program meant to expand dairy production beyond the upper Midwest; which states the price per ton of a farmer's milk is set by one's distance from Eau Claire, Wisconsin. As a result, Wisconsin dairy farmers are punished geographically by their own federal government.

This problem has since been solved in the real world by immense dairy expansion in the nation; and modern technology like the refrigerated rail car, airplane container, and semi trailer. Congress has yet to realize the country no longer needs them.

MILC is meant to act as a safety net when prices in the free market (Using Boston Class I [fluid milk] Prices as the benchmark.) drop below a certain level. If that happens, the federal government cuts checks to farmers in other states -- typically in the Midwest -- to help offset the loss.

Currently, no checks are being cut, since the June 2007 Price for Boston Class I is above "MILC mark" ($16.94 per 100 wgt) selling at $21.09 per 100 wgt.

Okay, is that enough background?

Which brings us to today, the regional dairy war against MILC in the House Ag committee, and the exclusion of MILC from the 2007 AG Bill.

WASHINGTON — Aid for struggling dairy farmers is not included in a sweeping farm bill unveiled by the House Agriculture Committee on Wednesday.

The omission sent dairy state lawmakers from Vermont, New York and Wisconsin scrambling to try to persuade the panel to authorize an extension of the Milk Income Loss Contract program, which provides subsidy checks to small family farmers when prices drop below a certain amount.

Wisconsin farmers received $486 million through the program from 2003 through part of 2006, according to the Wisconsin Farm Bureau Federation.

That includes producers like John Van Deurzen of Hobart.

"I'd like the safety net in there, not that we need it right now," he said Wednesday afternoon.

Van Deurzen said his farm benefited from the program when milk prices were soft.

The program is scheduled to expire at the end of August — a month short of the end of the fiscal year.

Unless it can be extended through September, it has little chance of being included in the final five-year farm bill that comes to a vote this fall because it would no longer be considered an existing program.

Wisconsin does have representation on the House Ag Committee in the sole form of freshman Congressman Steve Kagen (D-Appleton), who was either caught completely with his pants down on this, or too busy being told how to vote by the likes of Pelosi, Hoyer, Murtha, and Emanuel.

Many thought Kagen's selection to Ag was more about his 2008 re-election chances than his knowledge of Agriculture policy or seniority in the House. Letting MILC not even be included in the new Ag Bill helps in proving that theory.

In reality, it is likely MILC [and Kagen's blunder] will be saved in the Senate, where the program's founders and biggest supporters - Vermont's Pat Leahy and Wisconsin's Herb Kohl - will ensure it is included in that chamber's version of the farm bill and the conference report to follow.

As for expanding the program, members of the Wisconsin delegation have been trying to get MILC expanded for months. Dave Obey even added it to the Iraq War Supplemental Bill that was vetoed by President Bush.

The President is on record supporting the program; the Iraq War bill was vetoed for other things, not MILC's inclusion.