Congress May Push Milk Prices to $8 a Gallon

Money Talks News

You really might cry over spilt milk next year, if Congress doesn’t pass a farm bill. Without it, milk could cost twice as much as gasoline in January.

Sound familiar? That’s because the same scenario was playing out last year. Lawmakers couldn’t agree on an important bill that sets funding for farms and food stamps. News outlets such as The Huffington Post were calling it the “dairy cliff,” a spin on the fiscal cliff, yet another financial disaster brought to you by Congress.

Once again, the fight is over food stamps. Last year, Republicans managed to get about $100 million cut from the program in a deal that avoided a milk price hike, The Huffington Post says. (The program costs about $80 billion, CBS DC says.) But they’re looking for a much bigger cut this year.

“The House has passed legislation to cut around $4 billion annually, or around 5 percent, including changes in eligibility and work requirements,” CBS says. “The cost of [food stamps] has more than doubled over the last five years as the economy struggled, and Republicans say it should be more focused on the neediest people.” Meanwhile, the Senate has proposed cutting only a 10th of that, or about $400 million, CBS says.

Unless Congress gets its act together, CBS says, “1930s and 1940s-era farm law would kick in, as much as quadrupling the price that the government pays to purchase dairy products.” In that scenario, farms would make more money by selling to the government than to the commercial market, meaning that the milk that did make its way to grocery stores would be far more expensive.

“Without a deal, consumers in January could pay $8 for a gallon of milk,” ABC News says.

This article was originally published on MoneyTalksNews.com as 'Congress May Push Milk Prices to $8 a Gallon'.

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