[Congressional Record Volume 145, Number 164 (Thursday, November 18, 1999)]
[Senate]
[Pages S14766-S14768]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          RESPONDING TO CRITICS OF THE NORTHEAST DAIRY COMPACT

  Mr. LEAHY. Mr. President, I read an editorial this morning in the 
Wall Street Journal that made incorrect

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statements about both the distinguished majority leader, Senator Lott, 
and the Northeast Dairy Compact. In fact, the editorial was totally, 
factually wrong. If the editorial writers would have checked their 
facts, they would have known that.
  Basically, the writers used arguments of opponents of the Northeast 
Dairy Compact, and they used those arguments without any determination 
of whether they are accurate or not. This time they used the arguments 
to go after the distinguished majority leader and others who supported 
the compact. They have used the so-called facts other times, but, 
again, they have always used them in the same wrong arguments.
  I have referred many times to the major GAO study that was issued on 
milk prices. I have referred to the detailed OMB study on the compact. 
Opponents never offer any proof for their arguments. I am fed up with 
the Compact being criticized as a back room deal because I remind 
everybody that we actually had a vote on it, albeit in the form of a 
cloture motion, but we had a vote on it on the floor of the Senate and 
a majority of Senators, Republicans and Democrats alike, voted for it. 
The majority voted for it this year. Now those who oppose it are using 
filibusters and parliamentary dodges because they know that they lost 
the vote.
  I am fed up with opponents attacking the compact as a special 
interest cartel, a compact which is made up of family farms, 
considering the largest opponent of the compact is Philip Morris, the 
tobacco giant which owns Kraft. The supporters are family farmers; the 
opponent, Philip Morris. It does not sound as if the supporters are 
really a cartel.
  I am fed up when opponents of the compact say milk prices are higher 
in New England when typically milk prices are higher in Wisconsin and 
Minnesota than they are in New England. The places that do not have the 
compact and who are attacking it the most charge their consumers more 
for milk on average than the area that does have the compact.
  GAO did a study of this and they looked at milk prices during the 
first six months after the Compact was implemented. GAO found that 
consumers in New England were able to buy milk considerably cheaper 
than in Wisconsin or Minnesota. The editorial writers and opponents of 
the compact do not point this out. Why do they not point this out? 
Because it points to the success of the compact and does not support 
the arguments made by the cartels that are opposed to it.
  Let me read some examples from the GAO report. For example: In 
February, 1998 the average price of a gallon of whole milk in Augusta, 
ME, was $2.47. The price in Milwaukee, WI, was $2.63, and in 
Minneapolis, MN., it was $2.94 per gallon.
  Take another New England city, Boston. In February 1998, the price of 
a gallon of milk was $2.54 as compared to Minneapolis, where the price, 
on average, was $2.94 a gallon.
  Or let's look at the cost of 1 percent milk for November 1997. In 
Augusta, ME, it was $2.37 per gallon, the same average price for Boston 
and New Hampshire and Rhode Island. But in Minnesota, the price was 
$2.82 a gallon, in other words, 45 cents more per gallon in the area 
that opposes the compact as compared to the much lower price in the 
area that has the compact.
  I could go on and on and compare low New England retail prices with 
higher prices in cities outside of New England. I invite anybody to 
review this GAO report.
  There is another report on the compact that was done by OMB. They 
issued a report which found the retail milk prices in New England, 
after the Compact was in place, were, on average, lower than for the 
rest of the Nation.
  The Wall Street Journal editorial page writers have ignored both the 
GAO report and the OMB report. Why? These are factual and objective 
reports that the Journal should have reviewed.

  It is clear that our compact is working perfectly by benefiting 
consumers, local economies, and farmers, something that is not stated 
in the editorial that attacked Senator Lott.
  I am especially fed up when opponents say the compact blocks 
interstate trade in milk when OMB reports the compact has increased the 
sales of milk into New England as neighboring farmers in New York, who 
did not have the Compact, take advantage of it. OMB reported that while 
the Compact was in force for the first six months, there was an 8 
percent increase in milk sales into the region. Instead of blocking 
interstate commerce, I would say an 8-percent increase in interstate 
commerce is an 8-percent increase in interstate commerce.
  I am fed up when opponents say the compact does not help dairy 
farmers stay in business, when it greatly increases their income. My 
best guess is dairy farmers, just as wheat, corn, or soybean farmers, 
when their income increases, they are more likely to stay in business. 
I recognize the Nation's major opponent of the compact, Kraft, owned by 
Philip Morris, does not want farmers to have the additional income the 
compact provides. But opponents of the compact should not argue it does 
not give farmers more income when, in fact, it does.
  Opponents of the compact say farmers in Wisconsin and Minnesota are 
going out of business, even though this is comparing apples with 
oranges. Even though the compact doesn't have an effect on them, they 
say we should not have a compact in the Northeast. Let farmers in the 
Midwest set up their own compact. I would vote for a compact for them 
or any other reasonable proposal that helps their farmers. Do not 
condemn one section of the country that is doing fine and protecting 
their farmers when, if they wanted to, they could do exactly the same 
thing in their own part of the country.
  I wish to mention for a minute what the compact replaces. Opponents 
of the compact prefer prices to be set by Federal bureaucrats. 
Supporters of the compact prefer pricing to be determined by consumers 
and local representatives, not by the Federal Government. The Governors 
and legislators in the six New England States had five goals in mind 
when they enacted the compact into law in each of their States. They 
wanted to assure fresh local supplies of milk to consumers at lower 
prices than found in most of the Nation. They wanted to keep dairy 
farmers in business. They wanted to protect New England's rural 
environment from sprawl and destructive development, and they wanted to 
do this without burdening Federal taxpayers.

  The Northeast Interstate Dairy Compact has delivered beyond the 
expectations of those Governors and State legislatures. The compact 
provided an added benefit. It has increased interstate trade into the 
region as neighboring farmers have taken advantage of the compact.
  This great idea, coming from those six New England States, has 
created a successful and enduring partnership between dairy farmers and 
consumers throughout New England.
  Thanks to the Northeast Compact, the number of farmers going out of 
business has declined throughout New England for the first time in many 
years.
  It is unfortunate that some still favor Federal bureaucrats running 
this farm program. We ought to instead be blessing this compact. Here 
is something not run by the Federal Government, not costing the 
taxpayers anything, but being done by the people who are affected by 
it. Indeed, half the Governors of the Nation, half the State 
legislatures in the Nation, asked that the Congress allow their States 
to set their own dairy policy through interstate compacts that cost 
taxpayers nothing. It costs taxpayers nothing. Let me say it again: It 
costs taxpayers nothing. Why do people oppose a program that is not 
costing taxpayers anything and affects just the people in the region 
who want it?
  This dairy compact passed with overwhelming support in almost all 
these States--Republicans and Democrats in the legislatures; Republican 
and Democratic Governors. Major environmental groups have endorsed the 
Northeast Dairy Compact. A New York Times and National Geographic 
article discussed the importance of keeping dairy farmers in business 
from an environmental standpoint.
  Consumer prices are lower, farm income is higher, and no increased 
costs to taxpayers. One wonders, why does anybody oppose it?
  One asks, why is it opposed? The answer is simple: Huge milk 
manufacturers, such as Suiza, headquartered in

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Texas, Kraft, which is owned by the tobacco giant Philip Morris, and 
other processors represented by the International Dairy Foods 
Association oppose the compact because they want to keep the money 
themselves. They do not want the farmers to have any of these profits.
  Even the most junior investigative reporter could figure out the 
answer. All anyone has to do is look up the donations made by these and 
other giant processors. All the negative news stories about the compact 
have their genesis in the efforts of these giant processors and their 
front organizations.
  I say this again on the floor, just so people understand, because it 
was an unfair editorial in singling out the distinguished majority 
leader of the Senate using facts which bear scrutiny. Indeed, one of 
the corporation front organizations, Public Voice for Food and Health 
Policy, apparently could not continue to exist when it was obvious that 
their policies were determined by corporate dollars rather than good 
policy. They had to close up shop when they lost their conscience.
  I have detailed the close alliances between their lead executive who 
handled compact issues for them and the job he negotiated to represent 
the huge processors a couple of times on the Senate floor.
  I will give the press another lead on the next public interest group 
whose funding should be investigated--the Consumer Federation of 
America. Indeed, one of their officers--formerly from Public Voice--is 
being taken around Capitol Hill offices by lobbyists representing 
processors. A glance at who funds their functions and efforts will be 
as instruction as investigations of Public Voice.
  Why should Philip Morris or Kraft want to use these organizations 
instead of directly going to the editorial boards of the New York Times 
or the Washington Post to badmouth the compact? The question does not 
need me to provide the answer.
  What would be the best attack--whether true or not--on the Compact 
that might swing public opinion?
  It might be to simply allege that milk prices are higher for children 
in the school lunch program. Who would the editorial boards more likely 
listen to regarding school children: a public interest group or a 
tobacco company?
  The PRESIDING OFFICER. The Senator from New Hampshire.
  Mr. GREGG. Mr. President, are we in morning business?
  The PRESIDING OFFICER. We are.

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