New California Milk Marketing Regulations Will Not Change Economic Fundamentals

Choices Magazine / Agricultural & Applied Economics Association

Federal regulation of milk prices began in 1933 as a central program in President Roosevelt’s New Deal agricultural policy (Sumner and Wilson, 2000). However, after the Supreme Court ruled that many features of New Deal programs were unconstitutional, California enacted a milk price policy in the Young Act of 1935. California adopted the main features of the price regulations that the court had said exceeded federal authority under the Commerce Clause to regulate commerce within a state. California retained its California Milk Marketing Order (CMMO) for more than 8 decades, despite the creation of a Federal Milk Marketing Order (FMMO) system under legislation later in the 1930s (Sumner and Wilson, 2000). This long-standing policy ended in 2018 with a vote to create a California Order as a part of the FMMO system administered by the U.S. Department of Agriculture (USDA).

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