Australia's dairy farmers face mass devastation, if the dairy industry becomes officially deregulated on July 1. Farm income will be slashed by 25-40% or more, as farmers will be paid 12-20c less per liter than they now receive. In the states of New South Wales (N.S.W.) and Queensland, milk quotas, which are worth $360,000 and $750,000 per farm, respectively, will become instantly worthless. Queensland farmers expect half the state's dairy herd to be sold for slaughter in the next two years, while the fate of the N.S.W. town of Bega, whose dairy farmers contribute about $50 million per year to the local economy, and which is expected to be almost totally wiped out, is illustrative of what will be happening all over rural Australia. An industry which supports 17,000 farms and upwards of 60,000 workers, will be decimated overnight.
The scandal is not only the scale of the destruction, but the fact that the farmers themselves were duped into voting for it, by lying campaigns orchestrated by the federal government, and by state governments that stand to make a bundle by driving farmers out of business, according to the dictates of Australia?s insane National Competititon Policy (NCP).
The NCP was adopted by Australia?s state governments in 1995, when they agreed to review all legislation, to remove any "anti-competitive regulations," in order to achieve greater "efficiency" and "improved service and reliability and lower prices for consumers." Under the NCP, governments are given hundreds of millions of dollars in bonuses, based upon how rapidly they deregulate anything and everything.
In the case of the dairy industry, the deregulation process was started by the state of Victoria's former Liberal Party Premier Jeff Kennett, who was driven from office last October due to hatred of his radical free-market destruction of health, education, infrastructure, and industry. Though Kennett was gone, the greedy dairy farmers of Victoria voted in December to deregulate, figuring that their colder, wetter climate, and therefore much cheaper production costs, would allow them to expand nationwide. Dairy farmers in the rest of Australia were then told that nationwide deregulation would be inevitable, both because the federal government was scrapping its 14-year Domestic Market Support (DMS) scheme on June 30, which included disincentives to stop the broader Australian market from being swamped by cheaper Victorian milk, and, because, once Victoria had deregulated, constitutional guarantees of interstate free trade would mean that cheap Victoria milk would undercut everyone else.
With this aura of "inevitability" about the process, dairy farmers in other states were asked to vote, not on whether they accepted deregulation or not, but on whether they would accept a $1.74 billion "adjustment package" promised by the federal government. The argument was made, "Yes, deregulation might be disastrous, but you'd better take some money while you can." But, of course, voting for the money, meant voting for deregulation. Desperate, farmers in Queensland and N.S.W. went for the money.
However, there was no such inevitability about deregulation at all, because the Agriculture Minister in the new, Labor government of Victoria which replaced Kennett, seeing that rural unrest had helped drive Kennett from office, pledged that deregulation in his state would go ahead, only if the $1.7 billion compensation package were guaranteed. And federal legislation stated clearly, that such compensation was conditional upon all states voting for it (i.e., to deregulate). Therefore, farmers in N.S.W. and Queensland (and Western Australia), have had the power to stop it—had they only been told of it. A last minute backdown by N.S.W politicians, if sustained, still might see deregulation halted.
The big winners will be the milk-processing companies like Parmalat (Pauls), Bonlac, and Dairy Farmers, and the grocery retail giants like Coles Myer and Woolworths, which will pay much less to the farmers, and will raise their prices to consumers, as is now generally conceded. "Under deregulation, $500 million a year will come out of dairy farmers' pockets and go to processors and retailers," charged Neil Baker, president of the newly formed anti-deregulation Australian Milk Producers Association.
But, there is no way the deregulation policy can be defeated as an isolated issue, as N.S.W. dairy farmer Graeme Muldoon, a spokesman for the Citizens Electoral Council, the Australian political party allied with Lyndon LaRouche, has been telling his fellow farmers all along. The only real solution, Muldoon has stressed in public meetings, and in a letter to Deputy Prime Minister John Anderson, is to break from the globalization policies which drive "competition policy" and deregulation, and go for a New Bretton Woods global financial reorganization, as proposed by LaRouche. "Anything else," Muldoon commented to this news service, "is suicide."
