Free Market Capitalism is the Best Way to keep Workers from Bathing in the Milk we Buy

Posted by PITHOCRATES - March 29th, 2014

Week in Review

Competition makes everything better.  If there was only one restaurant in town they could serve pretty bad food.  Because if the people don’t have time to cook for themselves where else are they going to go?  This restaurant could use ingredients past their ‘use by’ dates.  Meats discounted by stores because they passed their shelf life date.  They could use canned goods they heat up in a microwave.  Using the cheapest ingredients that can be cooked the least amount of time by the fewest people.  To keep costs down.  It can work.  Until there is competition.

If a restaurant opened next door that cooked only with fresh ingredients and did not use a microwave oven their food is going to taste a lot better.  And people will stop going to that other restaurant to enjoy the better quality next door.  This is why competition makes everything better.  Because people choose what’s best for them.  And if a business continually strives to exceed a customer’s expectations their customers will keep coming back.  If they don’t people will just take their business elsewhere.  And businesses will run tight ships.  To make sure no one brings harm to their brand.  Because if they didn’t something like this could happen (see Russian dairy plant closed after workers bathe in the milk by Sergei L. Loiko posted 3/28/2014 on the Los Angeles Times).

A Siberian dairy plant was temporarily closed Friday after its workers had been found bathing in milk, a Russian consumer oversight agency reported.

Trade House Cheeses, a dairy producer in Omsk, about 1,600 miles east of Moscow, was closed for 90 days by regional authorities for an urgent inspection after complaints resulting from photographs and a video posted by one of its employees on a Russian social network.

In the photographs and video clips posted on New Year’s Eve by worker Artyom Romanov, a group of undressed employees relax in a container of milk as part of their celebration. While still partly undressed, they then demonstrate cheese making in a clownish manner…

After the video appeared on NTV, a federal television network, many residents of Omsk refused to buy products made at the plant, an NTV report said this week…

“For five years Russia has been languishing in a so-called experiment of practically exercising no control over consumer production after a law was introduced limiting inspections of such facilities to only once every three years,” said Yanin, the board chairman of the Russian Confederation of Consumer Societies, a Moscow-based group…

The average salary of a sanitary inspector is equal to $500 a month, but instead of raising that, the government decided to try to prevent the inspectors from taking bribes by in effect seriously curbing their ability to control production norms and practices, Yanin said.

Of course, this is the wrong conclusion to draw from this. The problem isn’t lax inspections by underpaid inspectors.  The proper conclusion is in a previous paragraph.  That conclusion is why we don’t have these problems in the United States.  Or if we do they are very rare.  The same goes for other capitalistic societies based on free markets.  Unlike the communism they once had in Russia.  Or the crony capitalism they now have in Russia.  Because communism and crony capitalism are corrupt systems.  Government establishes and maintains monopolies.  Either by force under communism.  Or by bribes and kickbacks under crony capitalism.  Which, of course, eliminates competition.  And THIS is the problem here.  As the residents of Omsk identify.  Who refused to buy an inferior product.

You could get rid of all the inspectors in the United States and this problem would not be any more prevalent than it is now.  Why?  Because of competition.  Especially in the age of social media.  For business have lost sales for just appearing to think ‘incorrectly’ on social issues.  Just imagine what would happen if a video like this came from an American dairy.  The backlash would be the worst conceivable.  And this would happen before any government action.  That backlash would spread to every store throughout the nation.  Nay, to every capitalistic country based on free markets in the world where that brand sells its products.  People would pause as they reached for a product from this dairy on their supermarket shelf.  And move to the left or to the right.  And pick up a product from another dairy.

This is what keeps American dairies clean.  And every other established brand.  For with competition consumers can reach for another product on the shelf.  And once they do because they lost faith in a brand for any reason (such as cleanliness) it could take a very long time for that brand to reestablish the trust of the consumer.  Costing it billions in lost revenue.  This is why food businesses are cleaner in capitalistic countries based on free markets.  Because of competition and profit.  The two best protectors a consumer can have.

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Democrats in New York looking at Revising the Cost of Cow Poop

Posted by PITHOCRATES - August 25th, 2013

Week in Review

PETA doesn’t want you eating meat.  They say we should be vegetarians.  Because it is healthier for us.  And it will allow cows to live out their days naturally.  The way God meant them to do.  To graze, sleep and crap all over the land.  Instead of eating meat we can eat stuff that grows.  And dairy products from dairy cows.  For they have a pretty good life.  Food, shelter and a place to crap.  And someone to milk them.  Who could ask for anything more?  A pretty plush life on a small farm.  Not quite so nice on a large industrial farm.   Of course, there are some who are unhappy with the ethical treatment of so many cows.  Environmentalists.  Because of the crap (see Cuomo in Billion-Pound Manure Fight as New York Promotes Yogurt by Freeman Klopott posted 8/22/2013 on Bloomberg).

All that stands between dairy farmer Kerry Adams and expanding her herd of cows to tap New York’s booming yogurt industry is 1 billion pounds of manure.

Adams was planning to take advantage of a change Governor Andrew Cuomo pushed through this year that allows farmers to increase their herds to 299 from 199 before permits are required, which can add more than $150,000 to expansion costs. Then environmental groups sued to block the move, saying expanding dairy production will add 1 billion pounds (454 million kilograms) of unregulated cow dung annually, damaging waterways…

As in some other states, milk prices in New York are set by federal regulators. Even with increased demand from yogurt producers, prices aren’t rising, according to Novakovic and the New York Farm Bureau. To increase profits, farmers need to produce more milk, which means adding cows…

A permit requires farmers to handle the increased manure load. They must pay a certified planner as much as $15,000, obtain engineering designs for new systems that can cost $50,000 and execute them for about $100,000, the review said. That’s in addition to the $382,000 needed for cows, land and holding pens…

Adams and Travis Rea, whose family has owned a dairy farm north of Albany in Cambridge for 215 years, said they’re planning to mitigate their manure as they grow anyway. Both, though, are holding off on expanding until they know the outcome of the lawsuit.

“We don’t have much money day to day and we’re up against groups that do,” Rea said by phone. “The environmentalists, they kind of scare me.”

You would think that the most damaged drinking water would be from the wells under those herds these dairy farmers draw their water from.  Are they poisoning themselves?  If they are they must be a glutton for punishment.  Because they’re drinking the water their cows are pooping in.

Once the buffaloes roamed the Great Plains.  And the Native Americans followed these great herds.  Hunted them.  And drank the water all that buffalo poop eventually washed into.  With some estimates of those buffalo herds being as large as 30 million strong that must have been a lot of buffalo poop.  Yet the Native Americans didn’t bitch about it damaging the waterways.

The only thing that will truly please PETA and the environmentalists is if the human race just died out and became extinct.  But until we do they will make our lives as miserable as possible.  Such as interfering with free markets.  Raising the cost for anyone trying to do business.  And then bitch about all the cow poop we’re producing because some other anti-business law put a ceiling on milk prices.  Which made adding cows—and more manure—the only way to expand business.

It would be interesting to see what would happen if we pleased one of these leftist organizations.  Say PETA.  By freeing all captive farm animals.  Letting them live free in the wild.  Where they would all die from age.  Eating and pooping to their hearts content.  Which, of course, would draw the ire of that other leftist organization.  The environmentalists.  Because of all that poop entering our waterways.  For with no one killing cattle for their meat the cattle populations would grow like the buffalo populations once did.  So the environmentalists, of course, would call for the culling of those herds.  Killing animals to save the planet.  Wouldn’t those be interesting debates?  Between PETA and the environmentalists?  Two leftist groups attacking each other as if the other was a conservative.

Permit costs that can add $150,000 to a small family farm?  Fear of environmentalists?  What has this country come to?

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Government Regulatory Policies make Greek Milk the most Expensive Milk in the European Union

Posted by PITHOCRATES - November 24th, 2012

Week in Review

Greeks are furious over the high price of milk.  Some cannot even afford it anymore.  While others are calling for government to do something about the high price of milk.  Which is rather ironic as the government is responsible in large part for those high prices (see Price of milk makes Greeks’ blood boil by Karolina Tagaris and Alan Wheatley posted 11/22/2012 on Reuters).

Aravanis reserves his harshest criticism for government bureaucrats, who he says make it hard for farmers to obtain land permits to expand and reap economies of scale. “It’s not as if cows are going to be grazing in their living room,” he said.

George Kefalas, who produces milk on a family farm near the northern city of Thessaloniki, said it can take two or three years to get an operating license…

Attempting direct comparisons with prices elsewhere in Europe is treacherous because so many variables are in play, such as transport costs, rents and consumer preferences.

But Eurostat says the price in Greece of dairy produce -milk, cheese and eggs – was 31.5 percent above the EU average in 2011, the highest in Europe…

Skordas said milk was expensive because of farmers’ high production costs, expensive packaging and the cost of transporting milk to remote islands and villages.

Moreover, fresh milk is sold in Greece with a shelf life of just five days, which means more trips to collect it from farms.

Dairy farmers oppose a long-standing proposal to extend the shelf life of milk to 10 days, as is common elsewhere in Europe.

This could be done relatively simply in the pasteurisation process, but Skordas said cattle breeders feared – unnecessarily, in his opinion – that this would open the door to increased competition from imported milk.

Small farms.  Government restrictions.  High regulatory and compliance costs.  If the Greeks don’t want economies of scales (like they have in the US) and want only fresh milk (unpasteurized milk less than 6 days old) legally sold then milk is going to be expensive.  Especially when dairy farmers lobby government to keep their costly regulations in place to keep out less pricy imported milk.

Only government can keep out less pricy milk.  And only government can keep the cost of milk production high by mandating a short shelf life.  As the Greek milk market is a captive market Greeks have little recourse but to pay high milk prices.  Or demand that government stop raising the price of milk with their regulatory policies.

Milk is like oil in a way.  There is little difference between batches when it comes from the source.  But once it enters the regulated market governments start adding costs.  Making some milk (or oil products) more expensive than other milk (or oil products).  The reason why gasoline prices are different in the US than in Europe is that government taxes and regulations are different.  They’re more costly in the Europe so gasoline is more costly in Europe.  Just as milk is more costly in Greece than elsewhere in the EU.

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