Cap it, Dairy Farmers – You Don’t Deserve Any Extra

Recently, farmers have been protesting that supermarket chains have been purchasing their milk for “below production cost” (notably Tesco, which has now apparently switched its main controversy from horses to cows, the old troublemaker). This has supposedly come about because of a slump in global demand, an over-supply domestically and an increased share of supermarkets’ stock for dairy products being imported. While it’s not uncommon for repeated economic fallacies to crop up, sometimes one reads stories like these which are so banal that it makes you want to curl up into a ball and roll away.

Presumably this is an absolute scandal and we should protect domestic industry from the ravages of consumer preference and alternative production. Instead of shrinking the farming sector or cutting costs so that cheap milk can be sustainable for producers, we’re going to put our hands on our ears and pretend the rest of the world doesn’t exist. Whilst nobody wishes ill upon the working man or woman, we have to remember the purpose of industry – to produce for the consumer in the most efficient way possible. For instance, one protester said that “This milk should not be cheaper than a bottle of water”. Why not, exactly? We could have you all in other sectors doing things which the public deem to be financially necessary and the poorest people in the country could have a less expensive breakfast.

Elizabeth Truss, the environment secretary, in addition to hinting at forcing distributors to label where they source their milk from, said that  “Our hardworking farmers and the £100bn food and farming industry are vital for our economy and our countryside”. How is this any different from any other outdated industrial favouritism, conservative or socialist? Can we really imagine being angry that frankly, shoes are far, far too cheap and to ensure jobs we need to raise the price? A certain type of industry is not vital for the economy, industry in general is. In addition, I would have thought the environment secretary would want LESS farms and cows degrading the land. You can’t win with these people.

What is this political obsession with farmers?  The horror! The sheer horror! People are buying FOREIGN milk to make dairy products for the mass market! Dig up Friedrich List and give him a cuddle. Hugo, from Kensington, is biting his fingernails with anxiety that his cousin in Dorset may actually have to keep up with everybody else’s needs, and the Keynesian post-grads are sweating with excitement that they’ll get to rant to their students again about how imports mark a decrease in domestic output, and how they’ll finally be given their deserved keys to the printing press to spur demand back up again.


This is why we can’t have nice things.

There have actually been petitions to mandate that the government put a price floor on the price of milk between producers and distributors that has around 50,000 signatures. That’s right, a price floor. You know, that thing that, along with foreign protectionism, is regarded as destructive to the general welfare by 93% of economists. Well meaning, intelligent people want their milk to be more expensive. Granted, it may make them feel better in the knowledge that they’ve contributed to sustaining somebody else’s income by buying their goods at more than they would have otherwise, but that should remain with them; leave everybody else out of it. In fact, by mandating that we all collectively pay more for milk, other businesses that could have your custom lose out, so the idea that cheap goods hurt jobs is a tad silly and outdated. Yes, farming is an inelastic industry, yes, change hurts, but it’s far better for everyone that there is generalised economic progress and not special favours dished out for certain industries. The poor certainly don’t need their necessities to be more expensive, and the middle classes don’t need another excuse to feel great about themselves.

The history of Capitalism has been to find more efficient methods of production through competition, and moving the labour force into other areas so we have a greater variety and abundance of goods. If we start arbitrarily favouring certain economic interests over another, whether through price fixing or protection from foreign goods, this process is halted. While I do recognise there’s a case that communities to grow around certain industries and that this is not immediately flexible, the nature of communities and their trade has been changing for centuries we’re more adaptable to this change than ever before; this case is not different or special. If we had listened to the mercantilists and Luddites of the 18th and 19th centuries, we would not enjoy the standard of living that we have today, but at least everybody’s job security would be there, right? Sorry Britain, but we’re not a primarily agrarian society anymore, and if we followed that chain of economic reasoning our economy would still be primarily that; aren’t tractors lovely.

Whether it be exploiting the poor or making businesses unsustainable, market prices have always come under heavy criticism, no matter what number they are at. So whilst it may be seen as reactionary to resist the relentless onslaught of interest groups wanting to mould the economy to their own needs, remember that it’s far more progressive to not let certain industries hide away from the world, have their milk and drink it too.


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