Media Reality Check
  Notable Quotables
  Press Releases
  Media Bias Videos
  30-Day Archive
  The Watchdog
  About the MRC
  MRC in the News
  Support the MRC
  Planned Giving
  What Others Say
  Take Action
  Gala and DisHonors
  Best of NQ Archive
MRC Resources
  Site Search
  Media Addresses
  Contact MRC
  Comic Commentary
  MRC Bookstore
  Job Openings
  News Division
  NewsBusters Blog
  Business & Media Institute
  Culture and Media Institute

Support the MRC


What The Media Tell Americans About Free Enterprise

Tell a friend about this site

March 1997


Networks Blame Only Stores and Processors, Ignore Federal Subsidies
Who's Milking Consumers?

The price consumers pay for milk fell slightly last month. But it wasn't enough for network news reporters. Farmers complained that the wholesale price they sell milk for had dropped even more and that they should be getting more money from stores and processors, or consumers should be paying less.

Not one network reporter was curious about the dairy farmers' sudden concern for consumers. They didn't report that federal subsidy programs have long benefited farmers at the expense of consumers.

The networks didn't mince words, though, in describing what they saw as a corporate milk conspiracy. "Is a bully taking your milk money?" asked Dan Rather on the February 18 CBS Evening News. He thought so: "After a big jump in the wholesale cost of milk last year, farmers have lowered their prices. But...supermarkets and others are not passing the savings on to you."

A few days later, on the February 21 World News Tonight, Peter Jennings introduced a report on "who is getting fat off the milk you buy." Correspondent Erin Hayes reported that "agriculture economists say there is no good way to pinpoint exactly who is profiting, and they say for now there is little pressure on those who do make money on milk to drop their prices." Hayes interviewed a dairy farmer who told viewers that "the consumer is getting ripped and we're getting ripped, too."

CNN concurred. "Dairy farmers say they are being milked," announced Linden Soles on February 25. "The price that dairy farmers get for their milk has plunged 29 cents per gallon since October. That has translated into only a five cent per gallon price cut for consumers."

Not one of these reports noted that consumers have been getting milked for decades by federal policies that keep milk prices artificially high.

In the February Consumers' Research, Jonathan Tolman and Clark Massey of the Competitive Enterprise Institute write that according to the USDA, if federal dairy pricing rules "were eliminated, consumer expenditures on fluid milk alone would drop 14 percent." This means that consumers are paying "an estimated $2.7 billion a year in higher milk prices," in addition to what taxpayers must pay to fund the program.

And this is only the beginning. Tolman and Massey also argue that the government's convoluted pricing scheme, which they call "a study in econometric vertigo" (see table), discourages efficient production and keeps milk producers from specializing. "What innovations could have occurred had the incentive structure been better?" they ask. "No one knows, but the losses from foregone innovation and specialization probably are significant."

But these are consumer problems caused by the government rather than ones addressed by the government. They therefore go unreported by the national media.


Rich Noyes


Home | News Division | Bozell Columns | CyberAlerts 
Media Reality Check | Notable Quotables | Contact the MRC | Subscribe

Founded in 1987, the MRC is a 501(c) (3) non-profit research and education foundation
 that does not support or oppose any political party or candidate for office.

Privacy Statement

Media Research Center
325 S. Patrick Street
Alexandria, VA 22314