413 private links
recently I stumbled across the fact that, indeed, there is still such a thing as government cheese. In fact, there's a whopping huge amount of it, hidden away in caves in Missouri, and what's more, according to this March 2023 article in the Science Times, the story behind government cheese is a brilliant example of how screwed up things get when the government fiddles with markets.
Missouri cheese caves are deep within the Ozark Mountains' heart under Springfield. Made of converted limestone mines, the caves are perfectly kept at 36 degrees Fahrenheit to give an ideal environment for storing stockpiles of government-owned cheese.
It all started in the 1970s when the U.S. suffered from a national dairy shortage which was made worse by 30% inflation on dairy products. In response to the economic crisis, then-President Jimmy Carter decided to spend money on the dairy industry to encourage dairy production.
The government set A [sic] new policy where a two-billion-dollar budget was allotted to subsidize dairy products over the next four years. This plan was favorable to farmers but also led them to overproduce dairy products. The farmers became motivated to produce as much dairy as they could because they knew that whatever was not sold on the market would be bought by the government. //
Most dairy products were converted to cheese because they have a longer shelf life. By the early 1980s, the government-owned more than 500 million pounds of cheese. Because of this, the next U.S. President, Ronald Reagan, had to pass a law in 1981 enacting the public distribution of government-owned cheese. //
In the years that followed, the demand for cheese declined, but the production rate remained the same as the government continued to support dairy producers. As of 2019, the collection comprises almost 1.4 billion pounds of surplus cheese in the U.S.
So, the federal government, with your tax dollars, has produced 1.4 billion pounds of cheese and has it stored in caves in Missouri. //
All the cheese is still there, presumably awaiting another Ronald Reagan, who will crack open the cheese vaults and give back to the American people the cheese that they have, after all, already paid for. The problem is, that dumping a billion-and-a-half pounds of cheese on the market will have a brutal effect on cheese prices and American dairy farmers. It's difficult to see a good way out of this mess now. Once again the federal government has tossed a bunch of taxpayer money after a problem that would have resolved itself if just left alone. Forty years later, we are still paying for it. //
I'll keep saying it until I turn blue: Markets aren't perfect, but they generally get things right if they are left alone. The problem is that the government just can't leave them alone. And this is what happens.