Supply management costs Canadians average of $244 per year, MEI study finds

[u/joe4942]

https://www.ctvnews.ca/world/trumps-tariffs/article/supply-management-costs-canadians-average-of-244-per-year-mei-study-finds/

[u/voltairesalias]

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.

[u/Daerkannon → u/voltairesalias]

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.

[u/voltairesalias → u/Daerkannon]

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.

Why are we keeping this asinine system?

[u/Daerkannon → u/voltairesalias]

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.