The tail wags the cows
In the ‘60s a Czech dairy farmer was asked the difference between socialism and communism. That’s easy the farmer answered. When the socialists are in power they take the milk, when the communists are in power they take the cows. That farmer in cold-war Czechoslovakia would recognize Pennsylvania today as the state’s 10,000 dairy farmers are looking like a herd headed for slaughter.
Dairying is Pennsylvania’s number one farm business and while all farming is a grind, dairy farmers have a much harder row to hoe than their cattle or crop-producing colleagues. Dairy farming is a 365 day a year job managing more than 600,000 cows in the state. Pennsylvania’s cows produce over 42 million gallons of milk a day, the fourth largest production in the nation yet the state’s dairy farmers profits are as dry as a lot of their wells this parched summer of ‘99. In fact that Czech farmer might have been better off than Pennsylvania’s, the communists at least took the work off his hands.
In the midst of the great Depression the state decided that milk prices needed to be temporarily regulated and created the Milk Marketing Board. Sixty five years later this bureaucracy still sets the price of milk in the state. On April 1 when Pennsylvania’s milk regulators lowered milk prices by 21% the state’s dairy farmers were left holding their feed bags and little else.
Enter the Pennsylvania General Assembly. For two years the House had debated allowing the dairy industry to enter the Northeast Interstate Dairy Compact (NIDC). Formed by Congress in `96 with six New England states the compact sets a floor price on milk sold in stores. The compact’s price can be higher than what the other bureaucracies set so that the farmers can at least meet production costs. While that might be fairer than the Federal price setting system that bases the price of Pennsylvania milk on the price of Wisconsin cheese the NIDC compact will probably offer about as much relief as a thunder shower after a long drought. However lost in this unforgiving regulatory desert any drop of water is welcome and while many of the Commonwealth’s dairy farmers have their doubts they will now have their prices set by the NIDC.
Until a developer comes along. The average 159-acre dairy farm in the state is worth $2,400 an acre. Put a dozen townhouses on an acre instead of a dozen cows and the family farm is worth $3.8 million. In real working terms for dairy farmers its a little over 1300 years of production receipts for a cow. Letting the farmer forget about the joys of providing 30 gallons of water, 20 pounds of grain and 35 pounds of hay every day for each cow they own. Especially when at the end of that long day the reward is three government agencies and a non-representative multi-state bureaucracy setting prices so that they can just meet production costs. If that’s farm preservation policy the cows better be able to jump over the moon faster than the developers’ bulldozers that will surely be coming at them.
And they are coming. In 1996 more than 1/3 of American farmers were over 65 years old. In March 61% of Pennsylvania farmers responding to a Lincoln Institute of Public Opinion Research survey said business conditions were worse than a year earlier and 2/3 of them thought the worst was yet to come.
As dairy farmers dry up the Pennsylvania treasury is getting milked out of $85 million allegedly to preserve open space for an academic program called Growing Greener. While 70% of farmers told the Lincoln Institute that local zoning control was best for farm preservation the state’s Republican leadership races headlong to create more bureaucracies that would co-opt the local control that farmers rely on.
Another Czech, President Vaclav Havel recently spoke in Philadelphia. Under Havel’s free market leadership the emerging Czech Republic has become central Europe’s economic miracle. Despite the country’s success in his comments the reformer expressed two major fears for its future. The first is the Euro-Dollar. Havel fears a central bank without a constitutional government as its charter setting the value of currency. His other fear is unfettered environmentalism. Europe’s constantly growing Green Party believes all other rights are secondary to its uncompromising environmental agenda.
At the end of 1997 there were 7.1 million acres of farmland in the state, down about 21,000 acres in three years. The largest producing agricultural business – dairy farming – will now have its prices set by an unregulated unrepresentative central bureaucracy that will allow the farmers merely to meet production costs. Meanwhile the general assembly is moving headlong into open space policies like regional zoning and urban growth boundaries that will only squeeze the farmers more. The tail is wagging the cow in Pennsylvania. Some day if we recognize farm preservation as open space preservation, minimize the regulatory interference and reform local tax policy to be fair to farmers there are still 7.1 million acres left in Pennsylvania that are already open and growing green and are aching to be preserved.