According to the Huffington Post on Dec. 30, a last-minute compromise deal has been reached to avoid a gallon of milk from splashing over the fiscal cliff to the tune of $7 per gallon or more in the very near future. The compromise isn’t perfect, but it does stop the price of milk from rising to unheard of levels, at least for the foreseeable future.
The compromise came about from bipartisan discussions in the House of Representatives’ Agriculture Committee and talks with colleagues in the Senate, according to Frank Lucas of Oklahoma, the House panel’s chairman.
“It is not perfect – no compromise ever is – but it is my sincere hope that it will pass the House and Senate and be signed by the President by January 1,” Lucas, a Republican, said.
The price of milk is set by the Agricultural Act of 1949. Every time a new farm bill is passed, the new bill takes the place of the 1949 Act. Without a new bill or an extension of the current one, milk prices would revert to rules set in 1949, the last “permanent” farm legislation in the U.S. The rate would then be set by the production costs 64 years ago plus inflation, sending the price for a gallon of milk soaring to $6 to $8 per gallon after Jan. 1, 2013.
Lucas said that time had run out to enact a totally new five-year farm bill as was hoped; therefore, the compromise was in order.
Actually, a new five-year farm bill was passed by the Senate in June and the House Agriculture Committee followed through with their own legislation in July. The problem is that the House bill has never been brought to a vote by the full House due to both sides not being able to come together on food stamp regulations and crop subsidies.
Now lawmakers have to come together on a bill to avert the actual “fiscal cliff” and avoid the biggest tax increases ever to hit Americans. But for now, the milk for your morning cereal is safe.
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