NBC Leaves Out Big Reason Corn Prices, and Milk Prices, Are Higher
With gas prices dropping for more than three weeks, you’d think it would be hard for the media to complain. Down nearly 24 cents since last year and 29 cents since last month, things are getting better at the pump. But Meredith Vieira found another liquid to complain about on NBC’s “Today” – milk.
“If you feel like your wallet is getting sucked dry this morning, you’re not imagining things. On average a gallon of gas is $2.77,” she said, and “the average price for a gallon of milk is at its highest nation wide average ever, it will set you back $3.80.”
Reporter Lee Cowan explained that “dairy cows these days are being pushed to the limit, demand for their milk has never been higher, and neither has its price.”
Cowan then went on to tell us that in June of ’06 the price for a gallon of milk was $3.16. Now in July ’06 it has risen to $3.80, or as Cowan exaggerated, “nearly four dollars a gallon.”
Cowan said demand for milk is increasing, and the number of dairy cows can’t keep up. China and India are drinking a lot more than in the past, adding to milk demand even as they add to gasoline demand at the same time.
NBC’s report successfully tied energy and milk together, but left out a huge driver behind higher prices.
“Alternative fuels like ethanol have made corn a more pricey commodity, and corn is a cow favorite,” Cowan said.
Demand for corn-based ethanol has pushed corn prices higher, but that hasn’t happened in a vacuum. Massive taxpayer-funded subsidies are behind the market shift.
Ethanol and other alternative fuels were all the rage a few months back when everyone was encouraged to “go green” and lessen our dependence on oil. Thanks to that policy drive, “various tax credits and incentives for ethanol will cost taxpayers an estimated $6.3–$8.7 billion dollars annually between 2006 and 2012,” according to Taxpayers for Common Sense.
Those subsidies are having far-reaching consequences – though Cowan reported only the consequences, not the cause.
“But it’s not just milk,” he said. “The price of ice cream is on the rise too, leaving your wallet talking the licking this summer. Chocolate and cheese prices are climbing as well.”