Costs higher to dis­man­tle sup­ply man­age­ment

Tillsonburg News - - OPINION - Jim mer­riam jim­mer­riam@hot­

sup­ply man­age­ment con­tin­ues to be a stum­bling block at ne­go­ti­a­tions be­tween Canada and the u.s. over a new north amer­i­can free trade deal.

sup­ply man­age­ment is an awk­ward name for the quota sys­tem that gov­erns the pro­duc­tion and sale of milk and its byprod­ucts plus eggs, chick­ens and tur­keys in Canada.

it sets a price for pro­duc­ers, en­sures over­sup­ply won’t flood mar­kets and drive prices and qual­ity down, and gen­er­ally man­ages pro­duc­tion.

be­cause it in­tro­duces sta­bil­ity, the sys­tem helps en­sure a fu­ture that al­lows pro­duc­ers to plan and grow.

in a free-wheel­ing sys­tem with­out any con­trols, pro­duc­ers are al­lowed, if not en­cour­aged, to be­come their own worst en­e­mies by over­pro­duc­ing un­til their neigh­bours are driven out of busi­ness.

that’s the sit­u­a­tion in which amer­i­can pro­duc­ers, with­out a quota sys­tem, find them­selves.

u.s. pres­i­dent don­ald trump has railed against the Cana­dian quota sys­tem as it ap­plies to dairy prod­ucts. un­for­tu­nately, the pump­kin patch pres­i­dent has the same depth of un­der­stand­ing of dairy pro­duc­tion and trade as he has of lead­ing a coun­try.

the sit­u­a­tion is about much more than “lev­el­ling the play­ing field,” as trump says.

For ex­am­ple, the u.s. claims to em­brace the free mar­ket, yet heav­ily sub­si­dizes its dairy in­dus­try.

many ur­ban com­men­ta­tors long ago de­cided the quota sys­tem keeps con­sumer prices ar­ti­fi­cially high and there­fore it should be scrapped. that, of course, is a su­per­fi­cial view.

au­thor John ral­ston saul, quoted in on­tario Farmer, has taken off ur­ban glasses and come out in favour of the sys­tem, say­ing “a lot of amer­i­can dairy farm­ers would like to have the Cana­dian sys­tem.”

out in the boonies, the quota sys­tem has a huge im­pact on com­mu­ni­ties. busi­nesses that serve the farm in­dus­try, whether with feed, equip­ment or ser­vices, can sur­vive and thrive only if the sec­tor is suc­cess­ful.

an­other broader view of the com­mu­nity was ex­pressed by a reader whose fam­ily runs a dairy farm in south cen­tral on­tario. she works in a ma­jor agri­cul­tural or­ga­ni­za­tion based in ot­tawa.

she wrote, “We are ac­tive com­mu­nity vol­un­teers and sus­tain­abil­ity is at the heart of our farm …

“i am wor­ried that our farms and those of my friends will be for­ever and dras­ti­cally changed if our sup­ply man­age­ment sys­tem is ceded in these ne­go­ti­a­tions.

“i have trav­elled and spo­ken with farm­ers around the world and none can say they have ben­e­fited from quota dis­man­tle­ment.”

the re­luc­tance of gov­ern­ments in Canada to dig into agri­cul­ture and ru­ral life with a view to pro­tect­ing and main­tain­ing the sec­tor may be partly to blame.

When the on­tario gov­ern­ment dec­i­mated the horse race in­dus­try there was a naïve be­lief that only “rich” horse own­ers would be hurt. but for ev­ery one of those, there were 100 — from stall muck­ers to hay mer­chants — de­pen­dent on the in­dus­try.

gov­ern­ments have been ig­nor­ing the ba­sics about ru­ral life through­out the last cen­tury and will con­tinue to do so. at their peril.

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