Butter Lines In Norway

[JohnnyRingo]

I want my government cheese back!


From Motley Fool:

Butter Lines
By Roland Hughes - January 6, 2012


Anybody who has had to sit through a 20th Century History of the United States class or watched The History Channel has seen the images of people (mostly men) standing in bread lines, waiting for a pride-crushing handout to keep their families from starving during the hard times of the first Great Depression. Despite immense wails from and a great gnashing of teeth by the one-percenters, this country enacted social programs to feed those people and help pull the country out of bone-crushing poverty.

Thanks to North Korea we now having a shining example of the kind of starvation kill-off that would have occurred if we hadn't. At the time most politicians were probably more worried about ending up like Marie Antoinette than anything else. (There is great debate about "the cake." Some think it was an egg based fancy bread, but many believe it was flour and water only, called Hardtack in the United States. As a little kid, when it was wet you probably used it as glue.)

Norway, an oil rich country that enjoys highest per-capita gross domestic products, had butter lines over Christmas. These weren't people on hard times looking for a hand out. People were standing in line paying up to $500 per pound for butter. There are now stories of drug smugglers having switched to butter because it had a higher profit margin and lower risk.

How could this happen in today's world? Easy. Rather than offering low interest loans and spending government money to buy any over production to scale a dairy industry up, Norway imposed an amazingly high tarrif to keep foreign dairy products out. On a good year, the existing dairy industry to meet the needs of the population. Anyone involved with agriculture knows that "good years" don't happen that often and rarely happen in a row. Well, anyone except the government of Norway. After the Christmas fiasco, the government slashed the tarrif in half until some time in March. It will be interesting to see if any of them manage to get re-elected.

continued here:
http://beta.fool.com/seasonedgeek/2012/01/06/butter-lines/?source=eogyholnk0000001

[slay]

1. Oh boo-hoo it's just some butter - life goes on

there are way worse problems in the world. people have become so spoiled.

[Dorian Gray]

9. While I understand your sentiment

I have friends who live in Oslo, and they were really perplexed by the butter situation. Many local traditional foods, especially holiday/Christmas foods, are made with butter, and it caused a lot of problems. My friend dealt with the situation. She is an American and cooks with Olive Oil, often, so it didn't bother her. But the fact that butter, a simple product used by so many, was so expensive was shocking to her.

[provis99]

37. that is a contemptible and disgusting attitude to have.

[slay]

39. Huh? So you're saying it's NOT butter? Was it Parkay?

No, what is truly contemptible is how we ignore various genocides going on in Africa and other places around the world - JUST AS LONG AS WE HAVE BUTTER DAMNIT!1!! they are fighting for their lives over there - but since they don't have oil, we don't care. butter vs genocide - which is truly contemptible?

go take a butter bath and chill out yo.

[JDPriestly]

2. Do Norwegians eat that much butter?

We hardly eat butter at all. We eat olive oil, canola oil, but not butter. It may be that the Norwegian government is trying to encourage healthy eating habits by making eating butter expensive. Is that possible?

I'm really asking. I'm not making a sarcastic comment.

[JVS]

3. It's not a coincidence that the Land O' Lakes (MN) and Wisconsin attracted so many Scandinavians...

a bit over a hundred years ago. These were people used to fishing and dairy farming. For them the cow is primarily a dairy animal, especially considering how bland potatoes can get without some butter. My father once was dining with two partners on a project from Sweden and he took them to a steakhouse. When asked if they'd like anything for dessert, they ordered more steak.

[JohnnyRingo]

5. LOL: "more steak".

I guess A-1 counts as a syrup topping in that case.

Funniest thing I heard all day.

[Liberal_in_LA]

36. funny story.

[JohnnyRingo]

4. They were trying to protect their dairy farmers though import taxes

The moral of the story is that government subsidies are more effective than isolationism because when domestic production falls, prices skyrocket. Norway had a dairy shortage, but it can happen to any domestic commodity.

I agree that govenment can and should regulate our food prduction. Though many see farm subsidies as a handout to Big Food or unnecessary govt intrusion, the fact is that with properly planned control we can prevent wheat or dairy gluts that drop prices suddenly and drive many small farmers out of business. This is why the govt stepped in and handed out free cheese in the '70s. The end of this "socialist" program in the '80s, along with shady short term farm loans from shark banks, caused Neil Young and Willie Nelson to start giving yearly free concerts.

By the same token, shortages caused by an uncooridnated national food production chain can cause sharp spikes in commodity prices that hurt consumers. Using subsidies to control the peaks and valleys that affect our food supply is like taking a chain saw and levelling out the price to a small ripple. This is especially effective for the remaining mom and pop farms that don't have the deep pockets to weather an ever changing battle of supply and demand.

[fasttense]

6. If you mean isolationism is equal to tariffs, I'm afraid I disagree.

Before income taxes ever evolved in this country, it ran on tariffs alone (almost). Tariffs used properly can create stable productive economies. We being human only remember when tariffs have gone wild but in general, tariffs on manufactured products are a good thing if done reasonable and carefully.

Tariffs Do NOT equal isolationism. Tariffs if used carefully can create decent, well regulated economies and promote local industries. The Lexus is a prime example of the proper use of tariffs.

"Another favorite Friedman free-trade example is the success of Toyota’s Lexus luxury car, immortalized in his book The Lexus and the Olive Tree. But again, the reality is quite different from what Friedman naïvely portrays in his book. In fact, Japan subsidized Toyota not only in its development but even after it failed terribly in the American markets in the late 1950s. In addition, early in Toyota’s development, Japan kicked out foreign competitors like General Motors. Thus, because the Japanese government financed Toyota at a loss for roughly 20 years, built high tariff and other barriers to competitive imports, and initially subsidized exports, auto manufacturing was able to get a strong foothold, and we now think of Japanese exports as being synonymous with automobiles."

[Snake Alchemist]

11. Depends on your trade deficit/surplus. nt

[Zalatix]

7. Most of what you said made sense, however...

if you were in fact right about the tariffs issue, then China should have gone into depression by now, considering how high their tariffs have been.

[Snake Alchemist]

10. Depends on your trade deficit/surplus. nt

[Zalatix]

14. Indeed, tariffs should not be static, they should be for balancing purposes

And the WTO does in fact allow for those kinds of tariffs.

[Fool Count]

8. So Norwegian dairy farmers made some krona of the temporary shortage, big freaking deal.

Here in Australia bananas cost $15 a kilo after a typhoon wiped out a harvest. That wasn't the end of the world.
There is other fruit. After a new crop it is back to $1.50 and we survived somehow.

[Brickbat]

12. Welp, that's it. Any comparison or wish to be like any kind of Scandinavian socialist democracy

IS RIGHT OUT THE WINDOW, FOREVER. DO YOU WANT TO NOT HAVE BUTTER EVER AGAIN??

[Enrique]

20. yep, Norway is a liberal dystopia

and Obama is trying to make America into a liberal European butterless dystopia.

Don't let him do it!

[JohnnyRingo]

22. I guess you and I came away with different opinions of the article's gist

I saw it as a good lesson in how and why government should help guide that invisible free hand of the market. Tarriffs, whle being a useful tool in levelling the table for some manufactured goods like steel and autos, may not be as effective for farm commodities. Manufacturing remains consistent while crops can vary from year to year depending on unpredictable forces.

I believe the US should head toward a more coodinated venture with government oversight of what we grow and how much. Huge swings in food commodity prices, like in Norway, can put small farms out of business during gluts, and spike prices during shortages that gouge the consumer.

Think Hank Kimble County Agent dropping by and suggesting to farmers they plant more wheat this spring by offering a few hundred bucks a square acre to prevent high bread prices, or perhaps telling Mom and Pop Farmer they plant something else like corn that offers a subsidy so the US doesn't have to dump their wheat overseas. Instead of a tarriff to keep Mexican tomatos out of the country, offer US farmers an incentive to grow more of them instead of future McDonalds french fies. That's pure socialism.

Our food supply is something that can't govern itself, nor does any farmer have a crystal ball to tell him what will be profitable next year. Allowing the govt to keep it's hand on the pulse of food production can keep supply and demand in stable balance. In the '70s an oversupply of dairy goods caused the govt to step in and give away cheese to the masses. The drop in prices when conservatives stopped that program drove small farmers to apply for shark loans and created a market for the Neil Young and Willie Nelson benefit concerts that continue today.

[Starry Messenger]

33. +1

<3 We gots to have our liberty butter! USA!

[matmar]

13. Motley Fool? This is a pro "free trade" anti "protective tariff" screed intended to poo-poo..

any move away from WTO style economics....

Looky hear!! If you try to protect your domestic industries (aka jobs and living wages) you might end up having to pay more for X.

While ignoring the fact that tariiffs protected jobs and wages for years and years...

[redqueen]

16. +1

I like Brickbat's response too.

[Swede]

15. A Butter message to the USA!

Holleee cow!

[MichaelMcGuire]

28. Tommy's my new hero

[jwirr]

17. While I do not understand the economics of this I do see the necessity of keeping farming local.

Our farming exports have been used to compete with local farming in places like Africa until we have just about killed off their own ability to provide for themselves. This is the first time lately that I have heard of this happening in a developed nation. Of course many of the developed nations have regulations already that keep this from happening.

[JohnnyRingo]

23. We don't export wheat to stop other countries from growing it.

Nor do we do it to as a favor to feed the world.

We dump it on countries at lower than production cost to prevent a surplus here. Instead of growing too much wheat, we could offer a subsidy to those farmers to grow something like the tomatos that we import from Mexico.

It's not like we don't already do it. Corn subsidies have been in place for years in apprehension that ethanol is the fuel of the future. Since that failed to materialize, we're now at the point that corn syrup is in everthing we consume. I suggest we fire Hank Kimble and find someone who knows what he's doing to balance our food production to suit our needs.

[jwirr]

24. Yes, those subsidies worked - when I was growing up on a farm there were many acres laying

fallow. Which in itself is a good practice in keeping the soil healthy.

[Enrique]

19. we need to brace for a wave of Norwegian butter refugees

much like the Irish potato famine.

[WingDinger]

21. I cant BELIEVE noone here gets it.

They had a popularization of a diet there. With Gov. push.

Same as here, when carbs were evil, bread was going stale on shelves.

BUTTER, is the only fat, that is turned into energy, WITHOUT being transformed first. Ready to use.

It is not an artery clogger, for that fact. Also, it is very soft at room temp.

Mass consumption of anything, causes unintended consequences.

[JohnnyRingo]

25. I don't really know how much butter is in my diet

but my girlfriend, who takes care of much of my dietary needs, can tell me the price of butter on any given day like a commodity broker on the exchange floor, and she often does. I know she uses a lot of olive oil too, and speaks of it in coveted terms coined by gold merchants.

I wouldn't want to find out that any food staple like wheat, corn, or dairy is in such a shortage that prices approach the value of my drugs.

[WingDinger]

26. Good thing the ethanol subsidy ended, or you might be jonesing for your corn syrup.

[JohnnyRingo]

27. I actually like sugar better

I wouldn't know that if it weren't for products like Jones Soda and Pepsi Throwback that use cane sugar. We've become so accustomed to corn syrup sweeteners over the years that I think we've forgotten what the real drug tastes like.

[WingDinger]

29. What are you, Mexican? I did like sugar coke better too.

I think you will eventually find, that corn sugar, causes more allergy, more diabetes, more obesity than sugar. But, corn is too local and entrenched. Sugar is an import. Unless you do sugar beets or sumpin'. We suffer from what the processing plants LIKE producing, thus convincing us we want to eat it. Our senses cannot be relied upon to move enough product. They need to push it. In the way of profit. Healthy? Only if that is IN, enough to pay off. Obesity, diabetes, poor nutrition? Why not? If that is IN.

[SoCalDem]

30. Buy cream..make butter at home. It's not rocket science

[JohnnyRingo]

31. Hahaha. To me making a meatloaf is rocket science.

I pride myself in my expertise in auto mechanics and basic knowlege of all things science, but how a conglomeration of stuff from the refrigerator goes in the oven and comes out as food is beyond me.

You take for granted that you can cook. At my house you're having a sandwich.
Thank goodness I have friends who have harnessed the power of Betty Crocker. LOL.

[muriel_volestrangler]

35. Unsurprisingly, there are import tariffs on milk and cream too

It was 25 kroner per kg of butter; but, if I've read the results from the WTO correctly, it was also over 18 kroner (about $3) per kg of milk/cream of 6% or more fat content - which would make it incredibly expensive to get hold of imported cream to start making butter with. The problem does not stem from a lack of butter producing facilities, so saying 'produce it at home' doesn't help. It stems from a shortage of milk - which is not normally imported on a large scale into Norway. The area where this has hit hardest is butter (perhaps the cooperative with a near monopoly chose that, because there are butter substitutes more easily available than for plain milk, or for cheese).

[The Velveteen Ocelot]

32. I hope they aren't having to put olive oil on their lutefisk.

[ErikJ]

34. Norway higher GDP per capita than the US.

From yesterday's NYTimes. ---I guess Socialism just doesnt work huh?

....................But G.D.P. per capita (an insufficient indicator, but one most economists use) in the U.S. is nearly 50 percent higher than it is in Europe. Even Europe’s best-performing large country, Germany, is about 20 percent poorer than the U.S. on a per-person basis (and both countries have roughly 15 percent of their populations living below the poverty line).

While Norway and Sweden are richer than the U.S., on average, they are more comparable to wealthy American microeconomies like Washington, D.C., or parts of Connecticut — both of which are actually considerably wealthier.

A reporter in Greece once complained after I compared her country to Mississippi, America’s poorest state. She’s right: the comparison isn’t fair. The average Mississippian is richer than the average Greek.......

http://www.nytimes.com/2012/01/08/magazine/the-other-reason-europe-is-going-broke.html?src=recg

[Fool Count]

38. If only that "average Mississippian" existed anywhere in the real world,

he would be a total envy of his compatriot - "median Mississippian". He would be saying -"Thank
god for the filthy rich who contributed so much to my income". I suspect the median Mississippian
would be much less enthusiastic.