Pursuit of Happiness

Is everybody happy? In the dairy business, at least, the U.S. has tried to make them so. Housewives who had grumbled at the high price of butter were made happy as state after state allowed the sale of colored margarine. This didn't please the butter men. But the Agriculture Department had a way to make them happy, too: it promised to support prices by buying up surplus butter. An effort was even made to make foreign dairymen happy. They were allowed to ship as much dried milk, cream and buttermilk to the U.S. as they wanted to send. That seemed to take care of everyone.

But soon this pursuit of happiness ran into a detour. Oleo sales boomed and butter prices melted. Soaring imports of dried dairy products displaced millions of quarts of U.S. milk from ice cream and other products, and diverted them into butter. As butter prices kept dropping, the Agriculture Department had to buy more. In December alone, it paid $12 million for 15 million Ibs. of butter, cheddar cheese and dried milk. Some days purchases ran as high as 2,000,000 Ibs., all paid for by U.S. taxpayers (whose happiness had not been part of the deal).

Last week Agriculture Secretary Charles Brannan reluctantly decided the time had come to start making others besides taxpayers unhappy. He slapped import quotas on dried milk, buttermilk and cream, limiting imports in the first quarter to the level of a year ago--a little more than half the recent rate. Brannan had no choice: under a clause in the Defense Production Act, sponsored by Minnesota's Republican Representative August Andresen, dairy imports must be limited to quantities that will not "result in any unnecessary burden or expenditures under any Government price-support program."

Brannan's action brought quick protests from abroad. Canada's National Dairy Council proposed retaliation in the form of a ban on U.S. vegetable oils used in margarine. Said the Swedish Dairy Association's export boss Bengt Dock: "This is an example of giving to Europe with one hand and taking with the other." Harry Truman sought to make political propaganda. Said he: "This is the kind of law which makes the job of the Kremlin's propaganda experts a great deal easier."

The real solution to all the trouble seemed to be a return to an unsupported market in butter, with prices seeking their own level. Even dairymen might find to their surprise that the law of supply & demand could result in a better spread of happiness for everyone.

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