Posted bhy AzBlueMeanie:
Come Dec. 31, the inability of Congress to get anything done could push the country’s milk prices to as much as $6 to $8 per gallon unless Congress passes a farm bill renewing federal support for agriculture programs. A gallon of milk could cost $8 in 2013. Here’s why.
Without legislative action in the next five days, the government will have to revert to a 1949 dairy price subsidy that requires the Agriculture Department to buy milk at inflated prices. Much like the current fiscal cliff, the law was left on the books “as a poison pill to get Congress to pass a farm bill by scaring lawmakers with the prospect of higher support prices for milk and other agriculture products,” as Vincent Smith, a Montana State University professor, told the New York Times.
The Farm Bill isn’t technically part of the fiscal cliff. Speaker John A. Boehner (R-Ohio.) has resisted the call by Agriculture Secretary Tom Vilsack (D) to incorporate it into the budget negotiations — to avoid complicating the budget talks and losing GOP votes, a Boehner aide told Politico last week. Legislators from rural districts are also worried that crop subsidies could be a tempting target in the fiscal cliff negotiations, so they’ve been trying to push Congress toward a separate resolution, to little avail. Although producers would temporarily benefit from the hike in milk prices, it would hurt processors and consumers, and the dairy industry would prefer a long-term resolution as well.
The subsidy reversion to a higher rate will cause market instability. Steve Benen explains, GOP obstinacy may force milk price spike:
The most likely scenario would be farmers moving to sell dairy products to the government at the inflated prices, which in turn would limit consumer supply and cause huge price spikes on the commercial market. It's also likely companies that use dairy products would look to imported milk from overseas.
So, what's the problem? The Senate version of the farm bill passed with relative ease over the summer, but House Republicans haven't even brought a competing proposal to the floor for a vote. GOP leaders haven't made specific demands, but the proposal Republicans supported in committee included sharp spending cuts to measures such as nutrition assistance programs, in the hopes of making millions of low-income Americans ineligible for food stamps.
House Democrats hope to force the issue with a discharge petition, but do not yet have enough GOP support to push the farm bill to the floor, and time is obviously running out.
If you want your kids to have milk with their cereal in the morning, it's time to call your congress critter and tell him or her to get mooving on this farm subsidy bill. Milk is a major part of the American nutrition program for children.