Saturday, September 25, 2010

Harry Reid’s Dairy Commercial Only Tells Half the Story

(Amargosa Valley, Nevada) – In response to the new campaign television ad released by U.S. Harry Reid today which claims to have saved jobs at Anderson Dairy, Assemblyman Ed Goedhart (R-Amargosa Valley) released the following statement:

As I watched Harry Reid’s ad on ‘saving’ Anderson Dairy and the jobs of 130 employees I felt the need to explain the total ramifications of exempting Las Vegas from the federal milk marketing order referenced in the ad.
I manage the Ponderosa Dairy, Nevada’s largest dairy, which milks over 9,000 cows twice a day.  We produce 12 semi-tankers of milk each day, or one every two hours, and directly employ 145 employees and indirectly contribute to the employment of over 1,000 Nevadans.  Our economic output for Nevada is over $90 million.

When Sen. Reid carved out an exemption for Anderson Dairy – which, by the way, milks NO cows – he allowed cheaper ‘overbase’ milk – drinking milk produced in excess of government caps - to flow into Nevada from California, Arizona and Utah, which allows Anderson Dairy to pad their profit margin.

That’s a great deal for Anderson Dairy; however, Ponderosa Dairy – an actual production dairy, not a processing-only dairy - now has to truck its milk all the way to California in order to get the full “Class 1” allowable price for drinking milk (as opposed to milk used for making cheese and butter). Then some of our same trucks pick up cheap overbase milk from California and bring it to Anderson Dairy in Las Vegas.

Yes, you read that correctly.

Ponderosa Dairy now has to ship its milk to California, while California ships its cheaper overbase milk to Nevada.  We call it the ‘Milk Loop’ – and it eats up over a million gallons of diesel fuel, costing us millions of dollars a year in higher trucking costs.  The Ponderosa is only 80 miles from Las Vegas, but now we have to ship our milk 280 miles to southern California.

Because of the special deal Sen. Reid cut for Anderson Dairy – the Milk Money Compact - our business is now at a competitive disadvantage with others in the milk producing businesses in our region.  As such, we shelved all expansion plans in Nevada and instead invested over $100 million in Texas, Oklahoma and Kansas where we now directly employ hundreds of workers and generate much-needed tax revenue and economic activity which otherwise would have benefited Nevada.

When a rock is thrown into a pond, don’t look at just the splash.  Also look at the ripples that extend across the entire pond.  In this case, the jobs ‘saved’ at Anderson Dairy were at the expense of thousands of other jobs in Nevada.

Government does not “create jobs.”  Government jobs are financed by taxes levied on the backs of private citizens and private businesses.  And when government, at the behest of elected officials such as Sen. Reid, picks winners by carving out special exemptions in the law for favored businesses, it has a ripple effect that costs all of us in the form of market inefficiencies and reduced competition.

The government can’t give anything to anybody - including Anderson Dairy - it first doesn’t take away from somebody else.  For every winner as a result of Harry Reid’s deal-making, there are a lot more losers.

Sen. Reid can claim that no one can do more for Nevada ‘til the cows come home.  But the fact is, whether it’s the Louisiana Purchase, the Cornhusker Kickback or the Milk Money Compact, other people continue to pay for what Sen. Reid does for a chosen few.  And it stinks worse than anything you’ll ever smell from the back end of one of my cows.


Article posted with permission from: Nevada Assemblyman Ed Goedhart, Nevada Assembly District 36.