September 2002
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The fact that “laborers” have their own federal holiday is partly an indication of the strength of organized labor unions, which were instrumental in pressing the government to devote a holiday to workers. There's also a Labor Department in Washington, which regulates a variety of workplace issues, and often serves as vehicle to address concerns of working men and women.
For dairy farmers, of course, there's no federal holiday – it's just another day that crops need tending and cows need milking. There is an Agriculture Department that, just like the Labor Department, is designed in part to regulate our industry and serve as an advocate for the needs of agricultural producers. That's why it's sad this year to see the U.S. Department of Agriculture stumble so badly in its historic role as an agency that benefits farmers.
Specifically, I'm referring to the decision last month that the USDA will not let dairy farmers truly benefit from the countercyclical features of the new Milk Income Loss Contract program. The MILC program was a hallmark of the 2002 Farm Bill; it will provide deficiency payments to dairy producers when the monthly market price for milk drops below a set level. The new MILC program will soon be sending transitional payments to producers to make up for the painfully low dairy prices of the past nine months (Dec. 2001 – Aug. 2002), up to production of 2.4 million pounds of milk.
In announcing last month the details of the new MILC program, USDA at first indicated that producers could choose the months in 2002 when they wanted to begin receiving the monthly milk payments. That seems fair enough; Congress wanted a countercyclical dairy payment program in the Farm Bill, and the producer-friendly way to do that was to give farmers affected by the 2.4 million pound cap the option of when to receive payments. But just days later, the USDA said that producers won't be given the option of when to begin receiving payments. They'll be paid on their production dating back to last December, period. Never mind that last winter's payment rates are only about half of what they have been this summer. If you're a medium- or large-size producer, and you reach the annual production cap of the new program in four months, that's tough.
Now, this type of decision is a tough one to figure out, in light of the congressional mandate contained in the 2002 Farm Bill. Yes, restricting the retroactive choice of producers will save the government some money – but not much in the overall scheme of things. What it will do is severely penalize many of the same family farmers that Congress – and hopefully the USDA – is trying to help with the new MILC program
Another equally frustrating recent USDA decision (or lack thereof, to be precise) is the failure of the department to use the Dairy Export Incentive Program (DEIP) in the coming year. The DEIP is one of our best tools to help clear the U.S. market of dairy commodities such as nonfat dry milk powder, cheese and butter. Although the amount we can export using DEIP subsidies has declined over the years, we still can move economically-significant quantities of those products, once USDA begins issuing DEIP bonuses through the program to companies that export the dairy items.
As a prelude to using the DEIP, the USDA every summer has to make an announcement that the new DEIP year is beginning. That announcement is a technicality, really, and one that occurs almost automatically each July 1st. Except this year. It's been two months now, and the USDA has still not given the green light for the DEIP program to begin issuing bonuses. Never mind that milk powder, cheese and butter are all at or near price support levels. Never mind that dairy farmers are suffering from high grain prices, bad weather and killer low milk prices. The USDA is just sitting on its hands instead of jump-starting the DEIP program.
And never mind that the same 2002 Farm Bill which created the MILC program also reauthorized the DEIP and instructed the USDA to use it to the “maximum extent possible” under the law. The silence from the halls of USDA is deafening.
So these are just two examples where producers have been given the short end of the stick by the USDA. And I don't know what the possible explanation for these actions could be: is it that the Department has become tied down by bureaucratic tangles? Has the agency forgotten its long-standing mission in service to agricultural producers? Or are the people running these programs less sensitive than they could be to farmers? Any of the answers to these questions leaves me with a confused feeling about the federal agency that many farmers look to for some assistance during tough times like these.
Dairy farmers aren't looking for special recognition in the form of holidays or three-day weekends. They just want to earn a decent living – something that's been hard to do this year. And they're not looking to USDA to solve all of their problems. But they would like the 130 year-old agency, one of the largest in the government, to be part of some solution, not just part of another problem.
