The Fortunes of the Dairy Lobby


Milking the Public, by Michael McMenamin and Walter McNamara, Chicago: Nelson-Hall, 1980, 300 pp., $13.95.

In the city of Washington, certain words are instantly associated with corruption. Nixon is one, and Korea is another. A third is milk. Yes, milk, the wholesome drink from contented moo-cows, is synonymous with wrongdoing.

To learn the reasons why, read Milking the Public by Michael McMenamin and Walter McNamara. The book explains in great detail how the dairy industry has milked us all for billionsan estimated $500 million to $800 million a year more than the market value of milkby using a system of cooperatives, taxpayer-subsidized price supports, and politicians bought off with bribes or "contributions."

A dairy cooperative, to start with, is not a bunch of friendly farmers who get together for barn raisings. It's a cartel front-group. Most or all of the raw milk in any given area is funneled through a co-op in order to fix at an artificially high level the price that milk processors must pay. Meanwhile, federal support mechanisms guarantee a minimum price and ensure that any surplus milk will be purchased by the government, making milk production nearly risk-free.

Co-ops, the authors note, did not consolidate their power until the mid-1960s. It's no surprise that that is when the bribes, "contributions," and steep increases in price supports began in earnest. Presidents Johnson, Nixon, and Carter have been splashed with dirty or at least suspicious milk money, McMenamin and McNamara say; so have hundreds of congressmen. Even populist champion Hubert Humphrey was tarnished.

The sums have often been staggering. One co-op alone gave $100,000 to a Nixon campaign. New campaign-finance laws have cut the size of individual sums but done little, the authors believe, to diminish the dairy lobby's influence. The three largest milk co-ops managed despite the new laws to contribute $1.2 million to congressional candidates in 1980.

It's ironic to note that in the 15 years since the milk scandals and artificially high prices began, milk consumption has declined significantly. The average American consumer drinks about 30 percent less milk now than he did then. You might think this would give dairy farmers pause and inspire them to improve their product's reputation and lower its price. Apparently not. After all, Washington can award them higher profits by boosting price supportsand if people boycott milk as a result, well, then Washington just buys up the surplus (using the boycotters' tax money, natch). "The dairy lobby believes that politicians are more important to their economic survival than consumers," McMenamin and McNamara note.

This preference for bailouts, subsidies, and political arm-twisting over meeting economic problems head-on is central to the decline of American industry. In agriculture, government subsidies have been granted to tobacco (a double subsidy, since government also pays much of the costs of the cancer that tobacco causes), sugar, and other commodities. At the moment, peanut farmers are demanding special handouts, a particularly brazen exercise in greed since peanuts are in short supply, making peanut prices soar on their own.

There is some hope of relief, as the Reagan administration was successful in its fight to block the milk price-support increase scheduled for April 1. But there's still a long way to go. Remember, if the price support doesn't go up, farmers might compensate by increasing milk production, forcing the government to buy up even more surplus.

The book documents complex milk wheeling-and-dealing in exacting fashion. Especially impressive is a long chapter about the bribe controversy surrounding John Connolly. The jury found Big John innocent, but the reader may come to other conclusions. (Whether Connolly may be guilty or not, the authors point out, at no point did the dairy lobby ever deny that it attempted to bribe him. It almost seemed proud of the factand asked that the $10,000 bribe seized as evidence be returned!)

Unfortunately, most of Milking the Public has about the same effect on the reader as a warm glass of what's being talked about. The writing is humorless and predictable and so crammed with numbers and acronyms that it's almost impossible not to get lost. But perhaps more important, the authors do not communicate any sympathy for the human side of the industry they are dissecting. There is no sense that either of the authors has ever wandered around a dairy farm with hip boots on or accompanied a milk truck on its predawn run. Maybe they have, but it doesn't show. There is no sense that the authors have done any research beyond checking clip files and legal documents, and this might explain both the book's lack of anecdotal richness and its failure to sympathize with the hardworking farmer at the bottom of the chain.

The milk business is politically corrupt and overly subsidized, and that should be changed. But even as we appreciate Milking the Public's contribution in making this clear, we must remember that the dairy farmer is a pretty impressive old coot. Despite price-support inflation, retail milk prices remain lower here than anywhere except Australia and New Zealand. The high productivity of US dairy farms has also prevented any serious shortages in recent decades.

The fact that dairy farmersmost of whom are decent, industrious, and not living lives of conspicuous luxurygot involved in the co-ops and "contributions" bears troubling lessons about a country where it is all too easy for decent people to slide into respectable-sounding wrongdoing. Yet McMenamin and McNamara seem to suggest that squeezing an udder transforms one into an evil creature, and that is just not true. Condemning the dairy farmers' excesses, as this book does, is necessary to expose where they have gone wrong; sympathizing with their good side, which this book does not, will be necessary to spark lasting reform.

Gregg Easterbrook is an editor of the Washington Monthly.