Dairy Farmers Need Solutions

Reprinted from the Henry County Local April 11, 2018

“The Farmer’s Pride” for March 15 features a heartbreaking story by Carilynn Coombs about the “termination” by Dean Foods of its “milk procurement contract” with her family —  along with more than a hundred other dairy farmers in Kentucky.

In that issue several articles deal with this subject, all pointing to calamity for families whose lives as farmers and whose farms are at stake. For its mistreatment of its until-now faithful suppliers, Dean Foods passes the responsibility to Walmart, which has built its own milk-bottling plant and, as usual, is competing against everybody.

The problem is a surplus of milk. Sharon Burton’s editorial, also in “The Farmer’s Pride” of March 15, and on the same subject, contains a penetrating insight: “I’m not talking about dairy farmers…I’m talking about rural America.” She is right. The story of Dean Foods’ cancelled contracts is a representative piece of the story of rural America since the 1950s, when Eisenhower’s Secretary of Agriculture told farmers to “get big or get out.”

From then until now the ruling assumption among the experts has been that there are “too many farmers.” The instrument for getting rid of the dispensable farmers has been uncontrolled production. Farm surpluses depress prices, and low prices benefit the agribusiness corporations by ruining farmers.

And so the story of rural America has been the story of the dispossession of millions of farm families, the disintegration of rural communities, and the destruction of small businesses and small towns. Carilynn Coombs’s family is one of the two in Henry County whose contracts have been broken. And those are two of the remaining small handful of families in Henry County who still live by farming.

So it has been, and so it is, everywhere in rural America.

From the several reports I have read about the broken contracts, I have learned some remarkable things:

» Whether or not Kentucky’s agricultural offices and organizations were surprised by Dean Food’s cancellations, I found no indication that they have any solution to the old problem of overproduction, or that they can offer any substantive help to the afflicted farmers. Maury Cox, executive director of the Kentucky Dairy Development Council, wrote in The Farmer’s Pride that his organization has exerted itself to “gather information” and “discuss potential options.” He said that the commissioner of agriculture and the Governor’s Office of Agricultural Policy “are ready to take whatever actions they can to help” and that “Kentucky Farm Bureau is also involved to help.” But he did not specify any actual help that is prepared or recommended. He confessed at last that for the terminated farmers it “may not be profitable to continue in the business. Each producer will need to make that decision for their family and business.” In other words, these farmers are alone with their troubles, as farmers nearly always have been. According to the Sentinel-News, Shelby County Extension Agent Corrine Belton “said the situation —  though inevitable —  could be a turning point for the dairy industry —  but whether for better or worse is yet to be seen.” This also is of no actual help to anybody.

» The “Sentinel-News” reported that neither Mr. Cox nor Ms. Belton blames Walmart. Ms. Belton said, “It’s not Walmart’s fault, they just made the best business decision for them.” Are we to think, then, that Walmart’s “best business decision” justifies any damage it may do to Shelby County farmers, or to rural America? As county extension agent, Ms. Belton may be speaking for the University of Kentucky, but I hope not. Again, like Mr. Cox, she offers commentary but no help.

» The “Sentinel News” reported also that, according to Reace Smith of Dean Foods, “the nation’s dairy industry is currently producing about 350 million more gallons of milk each year than the year before.” For an industry to confront a crisis of overproduction by adding further large surpluses is insane, but it is insane only from the point of view of people who are sane and morally responsible. Who benefits from these immense surpluses?

Well, those who profit directly are the corporate suppliers of “inputs,” from seed to chemicals to machinery to fuel. But the surpluses also serve the “dairy industry” by putting the small dairies out of business. For the large corporate buyers of milk, it is more “efficient” and thus more profitable to deal with one large dairy than many small ones. Walmart would rather buy milk from one dairy with 5,000 cows than from 100 dairies with 50 cows.

Nevertheless, as we rural Americans know, the health and prosperity of rural America would be far better served by many small dairies than by a single gigantic one. Mrs. Burton’s editorial recalls the familiar economic doctrine of “creative destruction,” meaning that some people must be sacrificed for the betterment or enrichment of others. And I like her very appropriate comment: “But when you are on the ‘destructive’ side of creative destruction, it doesn’t feel like a good thing.” She thus defines the side we rural Americans are on, and not by our choice. When the “creators” are looking for something to be destroyed —  plundered or poisoned or priced out of business —  they typically find it in rural America.

The person interviewed in these several articles who makes clear and admirable sense is Gary Rock, a dairyman, one of Dean’s terminated, in LaRue County: “He would like to see a base program across the nation that sets production quotas in line with market demands.” He thus sees through the problem to its solution. He is advocating the only solution to the problem of overproduction. Kentuckians don’t have to look far for an example of the necessary solution, for we had it in the Burley Tobacco Growers Co-operative Association. That organization effectively controlled production, maintained fair prices, and gave the same protections to small producers as to large ones. The history of the Burley Association disproves, as its membership conscientiously rejected, the “inevitability” of the destruction of family farms by agribusiness corporations.

And only Mr. Rock has the sanity and good sense to blame Walmart, which he describes as the “king-pin of putting small businesses out of business.” Of course! Walmart has “created” an immense family fortune by destroying the small businesses and small towns that once supported our farming families.

I know that the economy of rural America cannot be made or re-made to support small family farms very quickly. But a good start would be even a small movement in a few Kentucky counties to boycott Walmart.