Friday, June 26, 2009
(click on graph to enlarge)
If you look at the above graph, which covers more than five years, one obvious conclusion which can be reached by urban based policy makers, California dairy producers are willing to produce more milk with a complete disregard for profit.
Therefore, it should be small wonder that state and federal governments are perfectly willing to do nothing while lending a sympathetic ear.
This is not a market based system. The driver of production has been external capital provided by the real estate bubble. California production is now falling.
Policy makers need to understand the age of predictability is over. Dairy policy can no longer be based on unfounded assumptions.