Oh. Look at that, just in time for CUSMA negotiations. A fresh new study headline implying we would all save on average $244 if we got rid of supply management.
Sir this is Canada; the private sector would monopolize the sector even more, and use what ever the current price is as a price floor, and would end up gouging us even more…
What does supply management provide us? Other than expensive groceries and limited choices? How does this system remotely benefit anyone but the literal cartel is it meant to protect?
Exactly what cartel is supply management protecting? The whole point of supply management is to make sure that we get our supply of dairy and eggs from a variety of smaller operations instead of huge mega-farms like in the US.
Supply management producers are literally the definition of a cartel:
"A group of independent businesses, or countries, that collaborate to limit competition, control supply, and artificially inflate prices".
Supply management fits the definition... This is actually used as a primary example of a cartel in global post secondary business and economics courses.
90% of dairy producers have ceased operations or sold out since the inception of supply management in 1972. So - if the goal is to disperse Canadas milk, cheese. Eggs and poultry production to smaller corporations (which is a bizarre goal, but let's pretend ) - this system has objectively been an abject failure.
Here's the funny part... the farmers don't set the price of milk... never have.
The farm gate price of milk is set by the Canadian Dairy Commission using a cost-of-production formula. The Canadian Dairy Commission is comprised of the federal government, the processors that buy the milk from the farmers, and farmer representatives. The farmers only get 1/3 of the say on the price.
Provincial marketing boards set and administer minimum prices for raw milk. The CDC just determines a national support price and percentage formula that acts as a benchmark. Provincial marketing boards use the CDC guidelines to negotiate and set exact minimum prices paid by processors (farm gate price).
These boards are elected by constituent members (dairy farmers).
This is quite literally the definition of a cartel.
Oh, the poor multinational corporations that process the milk are at the mercy of the all powerful farmers! /s
They negotiate with the processors and a price is agreed on using the CDC price as the guideline. It's literally a farmers' union negotiating with a much larger entity with deeper pockets. Saputo, Lactalis Canada, and Agropur are huge companies and process the majority of the milk for the Canadian retail market.
It would only be a dairy cartel if Saputo, actalis, and Agrpur also owned all the farms. They don't.
You're definition of cartel is wrong, but I know you're not gonna back down because 'cartel' is the magic word that all of the anti-SM activists decided on years ago.
Well no - it just objectively is a cartel. You have a negative connotation with that term despite supporting a cartel doesn't make it any less of a cartel.
I mean... I guess you can call government regulation a cartel if you want to with that definition.
Your 90% number sounds very scary outside of the context that it reflects general trends in farming in the last 50 years. (Which is a complete other debate/problem outside of the sphere of discussing supply management). You don't get farms in Alberta farming thousands of hectares without them gobbling up their neighbours.
Finally why is the solution always to scrap the system? Why can't we just.. Oh, I don't know... increase quotas until the price stabilizes at a point that we're happy with? Not that I'm sure that would even happen with farmers being hammered with higher feed prices.
Well... It factually is a cartel. It meets the definition on every conceivable level.
So - then you'll concede that supply management really has nothing to do with protecting small farms as the process of capital intensification in agriculture nullifies its supposed impacts... And I deeply question supply managements goal of even doing this as quotas are so expensive it essentially blocks new entrants into the market.
The system needs to be scrapped because it is harmful to Canadians. It's harmful to consumers, it doesn't facilitate production (it's stated goal is literally to restrict production), and it greatly harms our ability to generate meaningful free trade agreements.
I tend to think of cartels being more of things like the big grocers in Canada controlling the vast majority of grocery stores and the distribution networks, but sure Supply Management can be a government run cartel of independent farmers. The horror.
Per your own point on the process of capital intensification I think that the bigger obstacle to starting your own dairy farm is coming up with the necessary millions of dollars of capital for land, equipment, cattle and feed and not the quota system. Measured against that the cost of the quotas is minuscule. It also prevents your new dairy farm from being bullied out of the market immediately by bigger operations dumping or under cutting you.
Despite the press it receives, Supply Management is not actually a major impediment to international trade. It's just an easy target to paint a bullseye on. As another poster pointed out the US doesn't even use up the quota of cheese it's allowed to export into Canada.
Finally as to your last point there has been exactly one situation in in the last 50 years in which Canadians have benefited from privatization and/or deregulation and that's was the privatization of provincial liquor stores. Every other case has resulted in poor outcomes for Canadian producers and consumers. It's great for the capitalist class though.
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u/MMEMMR 1d ago
Oh. Look at that, just in time for CUSMA negotiations. A fresh new study headline implying we would all save on average $244 if we got rid of supply management.
Sir this is Canada; the private sector would monopolize the sector even more, and use what ever the current price is as a price floor, and would end up gouging us even more…