If you have always lamented at the relatively high prices of dairy (and the small size of eggs) in Canada, you are not alone. If you ever wondered why, you should know that our supply management system that curtails production effectively keeping prices high is to blame. If you ever tried to find a politician who was willing to take on this sacred cow, no pun intended, good luck.
The main answer these politicians give to justify the supply management system has to do with the Americans subsidizing their milk producers, which is why milk is so cheap in the US. This, they say, would allow American farmers to unfairly compete with Canadian farmers. Sure, I say, and I also say so what? If Amercian taxpayers want to give us cheap milk, who am I to complain? They already give us free defense and cheap drugs.
Anyway, it turns out that in the middle of the fiscal cliff that faces the United States (and you thought the Mayans were wrong), Americans may actually lose their subsidies, thereby driving milk prices up to $7/gallon. If this happens, will Canada finally have a reason to abandom supply management?
