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Sun., Dec. 30, 2012, midnight

Editorial: ‘Dairy cliff’ looming without D.C. action

Count milk cans among the many Congress and the president will be kicking down the road in their face-off at the edge of the “fiscal cliff.”

If they do not kick it forward within the next day or so, in fact, they will be punting it backward – all the way to 1949 – with potentially disastrous results for consumers.

Dairy program reforms are wrapped up in the 2012 farm bill, which would substantially change the way the federal government has supported agriculture over the last 30 years. With American farmers enjoying some of their best years in memory, the timing was more opportune than a June rain to toss direct payments and go to a more streamlined system that protected farmers without soaking taxpayers.

The Senate passed its version of the bill in June. It would save about $23 billion over the next 10 years. That, mind you, out of a projected total expenditure of nearly $1 trillion. The House Committee on Agriculture finished its work in July. Although representatives were more aggressive than their Senate colleagues – their version saved $35 billion by taking a bigger whack at food stamps – the bill never came to the floor because some Republicans wanted more savings, and with just cause.

So, like all else in the Capitol, the bill has languished in the No Action Zone even as the 2008 version expired.

Farmers who do not plant until spring can wait out Congress for a while. Dairymen cannot. Their cows produce milk 24/7, and the industry has to know how the federal government will continue to stabilize prices for one of the most volatile of commodities. Barring congressional action, dairy supports default to those established in 1949. Using those dated formulas, prices for raw milk would about double, as would those for just about every other dairy product.

Of course, consumers would quickly respond by buying less of all those things, so the government would be buying more. That kind of cycle by the early 1980s had the federal government stockpiling hundreds of millions of pounds of cheese and butter. The surpluses gradually melted away after major reforms to farm programs during the Reagan administration.

“It’s just going to make a mess,” said Jay Gordon, executive director of the Washington State Dairy Federation.

Congressional leaders were working Friday to produce a compromise farm bill that would reinstate the expired legislation until the reform measure can be implemented. A delay would suit many just fine.

The farm bill has been synonymous with “pork” for decades, a fact many a farm state conservative would best like forgotten. And many an absentee farmer on Manhattan’s Upper West Side is quite happy with direct payments.

The “dairy cliff” has been visible for months. Both the Senate bill and the version that moved out of the House committee were bipartisan, if bloated, responses. Republican leaders, including Rep. Cathy McMorris Rodgers, were confident the bill would be approved by the full House.

Yet, so far, nothing. Just churning.

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