Funny, isn't it? I remember him making this specific point some time ago in relation to NAFTA - he specifically brought up the dairy issue. But that's ignored for the preferred narrative of "maniac Trump wants to tear up NAFTA"
Donald said that he wants to end NAFTA. Of course how one sees that is a matter of political and economic point of view. He can end it if he wants to. Let's see if he does. I wonder if USA milk producers are keen to sell to Canada and if they did are they subsidised by the USA government? It is a matter that we might be able to examine by judicious searches.
In 2009, the federal government spent $12.3 billion in payments to America's farmers. The number was cause for celebration, and not only among the tractor and overall industries. $12.3 billion was nearly the lowest payment in the past decade, as high food prices surpassed the threshold for subsidies.
By and large, most subsidies function as a form of so-called "farm income stabilization." The Department of Agriculture sets a price floor for a given crop. If market prices rise above that level, farms sell on the open market. If prices fall below, the government reimburses farmers the difference between the market and the floor price for every unit grown -- or not.
Even as farmers profit from increased demand, the government remains a major player in the food business. While assessments of the subsidies' quality varies -- with many commentators labeling them indigestible -- attempts to cut have thus far been unsuccessful.
So what is the Department of Agriculture putting on your plate? We present the top nine products that the government most heavily subsidizes. (source)
Among the subsidised agricultural products is milk.
MILK
Total Subsidies (1995-2010): $4.9 billion
% Change in Annual Subsidies (1995-2010): 1.5%
Biggest Producers: Dean Foods, Dairy Farmers of America
Milk is one of the most popular products in the United States. The average citizen consumes 3/4 cups a day. It's also one of the most populist. The so-called "price of a gallon of milk" test is a common method on which to judge politicians. (Rudy Giuliani's inability to pass presaged problems for his presidential campaign).
So it's no surprise that governments have frequently attempted to lower milk prices. (The one exception -- Richard Nixon -- took campaign contributions from dairymen in exchange for higher prices). Still, there may be signs that the regime could be coming to an end. In 2009, the WTO criticized the American subsidies, labeling them violations of the world body's rules. (Wikimedia Commons)
Perhaps Canada has a tariff on milk to equalise prices after taking into account the USA subsidy.
OTTAWA, Feb. 1, 2012 /CNW/ - A new website launched by Canada's dairy industry takes the bull by the horns when it comes to setting the record straight on the country's supply management system for milk.
Dairy Farmers of Canada (DFC) has created the site — yourmilk.ca — in an effort to dispel misinformed myths about Canada's dairy industry and its successful supply management system, which has delivered Canadians a reliable supply of top-quality dairy products for 40 years.
"Canadian dairy farmers don't receive any government subsidies and earn their income entirely from the marketplace," said Wally Smith, DFC President. "Consumers in other places where the dairy industry is subsidized, like the United States and the European Union, pay twice for their dairy products — once at the store and one more time through their taxes." (source)
A little research can be helpful. Perhaps you'd like to check more facts and see what lies behind the claims made recently by politicians. Trusting politicians to give an accurate account of the facts is usually a mistake.
- Myth: Supply management stops Canada from signing free trade agreements.
Reality: Supply management hasn't stood in the way of Canada's ability to successfully negotiate trade agreements. Since 1986, Canada has concluded NAFTA and bilateral agreements with Jordan, Colombia, Peru, Costa Rica, Chile, Israel and EFTA (Switzerland, Norway, Iceland and Liechtenstein).
- Myth: Only Canada manages imports of dairy products.
Reality: Supply management does not close doors to imports. The EU, with heavily subsidized dairy products, exports to Canada 10 times what it imports, even though it has more than 500 million consumers.
- Myth: Canadian dairy farmers are subsidized by taxpayers.
Reality: Canadian dairy farmers receive no government subsidies for milk. American governments spent $4 billion in subsidies for dairy farmers in 2009, or about 31 cents per litre, and European dairy farmers receive 55 billion Euros in subsidies per year.
