Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

It’s enough to make you cry in your milk

with 5 comments

William Watson, Special to the Sun
Published: Thursday, December 27, 2007

William Watson teaches economics at McGill University. So you can probably expect this was special to more than one paper

It is the standard rant against subsidies for Canadian farmers. So far as I am aware, I have not seen many stories about people being stopped at the border and having cheese confiscated – though it would not surprise me at all to learn that if you declare it, they make you pay duty on it. (I did do a quick check on Google too and found little of relevance)

But of course what is missing from this story is the 100 mile diet angle. Fortunately, most Canadians live within 100 miles of the US border, so we could get cheap dairy products and still not break the carbon tax bank. But the real thing that would suffer would be quality. There are some very good Canadian cheeses that I am quite happy to pay a hefty premium for – Balderson being as essential to me as fair trade, shade grown, organic coffee beans. There is very little American cheese that I have eaten with pleasure – and most of it seems to be designed to be melted over something else – including tuna! Then there are cheese playthings – cheese that looks like silly putty and tastes very similar.

The real reason for all this nonsense is that as long as there are props for local businesses they do not have to try very hard to compete on quality. And that is why I will and do pay more for things that I consider are better than their cheaper competitors. Remember too when Japanese cars were first exported they were regarded as cheap and nasty. That changed very quickly indeed. Honda and Yamaha did not crush the UK motorcycle manufacturers by selling cheap bikes but better bikes. We now pay a premium as Japanese cars (Toyota, Honda and so on – even though they are often built on this side of the Pacific) are obviously better built, more economical to oeprate and last longer than the Detroit equivalents.

When free trade was first discussed in Canada in my hearing in the election at the end of 1988, I thought of the changes we had seen in Britain as a result of the EU. And despite all the frothing in the popular press, most of it was positive. But the deal Mulroney did was much, much worse than anything in my experience, and completely lacked all the safeguards that the Brits liked to chortle about when they went after Brussels bureaucrats. But a lot of it was driven by quite proper distaste of poor quality British products that the French and Germans did not want to flood their markets. British beer for example is made out of all sorts of things – not just the barley, hops, water and yeast permitted by German law. Their sausages actually had to have meat in them. Their chocolate had to have a minimum cocoa content and so on. Mrs Thatcher’s claim to scientific fame was to produce soft “ice cream” for Walls – which contained almost no dairy content. The French were quite properly appalled by what was sold as cheese in many British shops. However, they also inflicted their dreadful golden delicious apples on us.

Anyway, the point I am not making very well is that we do not have “free trade” within Canada – let alone within North America. And the fact that we still have border guards along the 49th parallel is proof that NAFTA means nothing. But before we start to move in that direction, we do need to think a bit more carefully about how to protect what we value – and that includes the “family farm” which is a Canadian icon, and has a lot more political power than concern for the cities where most of us live.

Written by Stephen Rees

December 27, 2007 at 4:34 pm

Posted in Economics, politics

5 Responses

Subscribe to comments with RSS.

  1. Two comments. One a quibble and the other substantial.

    First, “Fortunately, most Canadians live within 100 miles of the US border, so we could get cheap dairy products and still not break the carbon tax bank.” Yes, but that assumes the milk is produced at the border, not in, say, California.

    Second, I think there is a subtle distinction that you are failing to make. The quota system is a protectionist measure to (supposedly) help farmers. The very tangible side benefit is that we have a higher quality milk in Canada than in the states.

    I am all for the high quality of dairy, but I don’t think the protectionist tariffs are helping Canadians. There should be a way to ensure the quality without relying on an archaic quota system. If American producers can meet the same quality requirements as Canadians (eg- no hormones, no ultra-pasteurization, etc), then isn’t it in our best interest tht they be able to sell to us?

    Perhaps I am misunderstanding your point, though.

    Andrew E

    December 27, 2007 at 6:48 pm

  2. ps- Merry Christmas!

    Andrew E

    December 27, 2007 at 6:50 pm

  3. On the whole I do not think that protectionism helps consumers. While I am prepared to accept that some producers may need some assistance to adjust to changing markets, the present dairy system in Canada gives us higher prices, although there may be some product advantages. If those are real, then consumers ought to be willing to pay for them. The fact that the dairy farmers are not willing to test that theory tells us a lot.

    Rural votes in Canada are much more valuable than urban votes. And every attempt to make our electoral system fairer and more representative fails to be endorsed since too many existing politicians benefit from current distortions. Canadian farmers have been kept going for a long time through various support systems – and as long as everywhere else also supports farmers (as the US and Europe do) then we have to keep the playing field level.

    I think energy costs will be higher in future, and it will take the transportation business a while to adjust to that, which means that in future local suppliers will have some advantage. I also suspect that more consumers are going to demand better products in return for local loyalty – see, for example, the success of local micro-breweries taking market shares from multinationals.

    My point is – I think – that the problem is a bit more complicated than Prof Watson is letting on

    Stephen Rees

    December 27, 2007 at 7:44 pm

  4. Stephen,

    I think you need to make a trip to the Oregon Coast and visit the Tillamook dairy plant. Some very good cheddars.

    Budd Campbell

    December 28, 2007 at 12:18 pm

  5. Possibly – but a long way to go for a bit of cheese. But a nice coast, and worth visiting in its own right, I will concede.

    My soon to be ex-wife comes from Wisconsin which produces vast amounts of cheese – very little of which suited my palate. “String cheese” being one of the nastiest, as fas as I am concerned.

    Stephen Rees

    December 28, 2007 at 12:25 pm

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: