MILC Renewal Draws Fire as Congress Approaches Budget Reconciliation

As the House of Representatives and the Senate move to reach consensus on a bill to cut mandatory federal spending, several organizations — representing taxpayers, senior citizens, conservatives and farmers — have expressed concerns to lawmakers about the proposed revival of the Milk Income Loss Contract (MILC) subsidy program. The MILC proposal is part of the Senate version of the budget reconciliation bill, which Congress hopes to pass before it adjourns later this month.

"The idea of reviving this failed program in the budget reconciliation process has clearly struck a nerve with organizations representing a broad cross section of the political spectrum," said IDFA Senior Vice President Chip Kunde. "These groups have raised serious concerns that should be heeded by Congress."

As previously reported in News Update, the Senate included $998 million in new spending for a two-year MILC program in its budget reconciliation bill, which cuts close to $35 billion overall in mandatory spending over the next five years. The House version of the bill does not include the MILC provision, but House Speaker Dennis Hastert (R-IL) made a commitment to several program supporters that he would instruct House negotiators to secure a new version of the expired program during negotiations over the final bill with the Senate.

On December 5, a group of five taxpayer and "good government" groups wrote a letter to Speaker Hastert criticizing the MILC program and the last-minute deal to try to resurrect the program. The Council for Citizens Against Government Waste, Americans for Tax Reform, the National Taxpayers Union, the American Conservative Union and Freedom Works stressed that any new MILC program should be put to an up-or-down vote of the full House and called the deal to extend it "a betrayal of the taxpayers." To read the full letter, click here. (.pdf)

Earlier this month, two retirement organizations — RetireSafe and 60 Plus — wrote to every House member, criticizing the MILC program and urging lawmakers to use the nearly one billion dollars in proposed MILC funding to restore cuts to Medicare, Medicaid, food stamps and heating assistance programs. To read that December 1 letter, click here. (.pdf)

What's more, in recent weeks, newspapers from the Pittsburgh Tribune-Review ("Get[ting] Milk[ed]") to the Wall Street Journal ("Milking the Taxpayer") have roundly criticized the proposed dairy subsidy program. In fact, the Journal's editorial concluded that "Taxpayers have been MILCed enough by this particular boondoggle."

Adding its voice to the debate, the Heritage Foundation, one of Washington's most respected think tanks, devoted a special section outlining the flaws of the MILC program in its December 6 guide for budget negotiators. The guide urges Congress to reject any renewal of the program. (To read the full guide, click here to visit the foundation's website. )

IDFA will continue to advocate for a more market-oriented and unified approach to dairy producer safety nets. For more information on the MILC program, click here.

Posted December 12, 2005