The next time you bite into a cheesy stuffed crust pizza at your local Dominos or Pizza Hut, you might want to thank the federal government.
For the past few decades, the feds have been keeping a literal mountain of cheese lying around for no ascertainable purpose. As of March 31, about 1.2 billion pounds of excess cheese had been accumulated in commercial cold-storage freezers across the United States — the largest such stockpile in history, according to the Washington Post. That’s 39 pounds of cheese for every man, woman and child in the country — so much cheese, in fact, that the government has been encouraging fast food chains to create new cheesy-centric products just to get rid of some of it.
Perhaps you remember Burger King’s Mac n’ Cheetos, a plate of Cheetos coated in fake macaroni-and-cheese goop, then deep-fried for your sinful pleasure. Yes, that’s a real thing.
So why, you may ask, are the feds subsidizing such monstrosities?
Turns out, the national cheese stockpile is a glaring example of how the federal government’s addiction to subsidies has gotten drastically out of hand. In the case of the cheese mountain, we have the Clinton administration to thank. In the 1990s, the feds helped create a promotional organization called Dairy Management Inc. This trade group began collecting dues from cheese producers. Today, Dairy Management Inc. raises more than $140 million a year in revenue — money that subsidizes our cheese mountain.
Because nothing says America like moldy globs of wasted cheddar. And deep-fried cheesy Cheetos, apparently.
The subsidy problem is not just limited to cheese — far from it. Indeed, what began as a way to give vital American markets a little help has now created a monster that unnaturally perverts the marketplace and ultimately does more harm than good.
America’s subsidy problem is not just limited to cheese — far from it
“In the long run, everyone — consumers, producers, middlemen, grocers — would probably be better off if governments just left the dairy market to its own devices,” writes Charles Lane of the Washington Post. “And a lot of other markets, too.”
Just look at agriculture subsidies, which now amount to more than 25 percent of the average farmer’s yearly income. Yes, you read that correctly: a full quarter of farmers’ incomes is paid directly by taxpayers. Which would make sense, if these farmers needed the money to provide us with food, but they don’t.
For proof, check out how those subsidies are distributed. “The top 1 percent of farm subsidy recipients received 26 percent of subsidy payments,” while the “top 20 percent of subsidy recipients received 91 percent of all subsidy payments,” according to the Wall Street Journal.
In other words, the small, local farmers, or 80 percent, receive a combined 9 percent of all farm subsidy funds, making our current system nothing more than a form of crony capitalism writ large across our amber waves of grain (not so majestic after all).
Perhaps nothing exemplifies the foolishness of our subsidy system than does the “herd retirement program,” which has been part of dairy farming across America for almost 40 years, according to Bloomberg. Because subsidies boost the production of milk in the United States, farmers will try anything to keep prices up. That includes killing their own cows to limit the supply of milk and cheese. Yes, that’s right: our subsidy system, originally meant to assure we have adequate milk and cheese production levels, now results in the wasteful killing of perfectly good cows.
That’s what a perverted marketplace looks like.
And that would all be acceptable if it weren’t for the fact that we have spent $5.6 billion over the past decade for the privilege of assuring that these cows keep dying and that Americans can keep eating nightmare cheese creations at our local pizza joints.
Ultimately, the question we must ask ourselves is this: how many additional billions should taxpayers spend so Pizza Hut can continue to invent new crazy cheese concoctions? Stoners across the country may think no price is too high — but everyone who isn’t high might have a different idea.
Evan Smith is a Staff Writer for Opportunity Lives. You can follow him on Twitter @Evansmithreport.