Big Government Cheese | Planet Money | NPR


The government manages a lot of things. Air and water quality, roads and bridges,
the tone of the national conversation. Also, once upon a time, a heck-load of cheese. [Oh my God. It’s cheese!] It all started in 1976. Jimmy Carter was running for president, and
he started floating this idea. “Although I am a farmer, I am not in favor
of guaranteeing farmers a profit. I am in favor of giving famers an equal break.” This wasn’t just political pandering. There’s an argument that our country has to
be able to produce its own food, because relying on other countries for food — that’s a national
security risk. Now this was a campaign promise that nobody
really expected him to fulfill, but then he became president, and in 1977 he announced
his plan to help farmers. And he wasn’t alone — Congress wanted in. We now go live to the Capitol. “Uh, we also love the farmers.” And so they passed a law for dairy farmers
saying that they wanted the price of milk to go up automatically every six months. There are two ways to make that happen. You either lower the supply by telling producers
to produce less milk, or increase the demand. Our government decided that increasing consumption
was more American than agriculture quotas. So they started buying milk themselves. “The Carter administration has announced a
new program to increase the demand of milk. Milk prices are expected to rise…” “Buckle up, Bessie.” But the thing about milk is, it’s kind of
hard to stockpile and transport. You’d have to get all these huge tankers, and of course it starts going bad the minute it’s out of the cow. So they moved one step down the supply chain
to dairy-based products like cheese. The way this program worked is that the federal
government says, “We will buy as much cheese, butter or nonfat dry milk as you want to sell
us, at these prices.” The government buys more cheese, cheesemakers
buy more milk and the resulting demand pushes the price of milk up. The government is creating a price floor,
and in order to do this, they have to be willing to buy all of the cheese that anybody wants
to sell them at this price. And if you’re a cheese seller and you hear
this, you’re like, “Well, I’m going to just sell them
my worst cheese at that price.” So to prevent this, the government said, “Look,
if we’re going to buy your cheese, first you have to meet with Bob.” Bob Aschebrock was a cheese grater. No, no, no, no, no, a cheese grader. Like what a teacher does. Bob’s job was to make sure that all of the
cheese met USDA grade A cheddar standards. He spent 30 years testing and tasting cheese
for the United States government. He’d use his cheese-trying equipment to look
for the 17 flavor defects that could happen in cheddar cheese. Flat, bitter, yeasty, malty, acidic, old milk,
fruity, metallic, sour, whey taint, wheaty, onion, barny, lipase and sulfide — it just
goes on. Bob and his fellow cheese graders were on
the road all the time, just eating cheese; and the government just kept buying and buying. Before long, every warehouse in Wisconsin
was full. There was cheese in practically every cold
storage in the United States, and the government needed an even bigger space to put it in. Ideally one with its own temperature controls. So they began renting these caves in Kansas. 35 feet beneath the ground, the size of 120
football fields. And trainloads of cheese started to show up. And when news gets out that the government
is filling caves with cheese, the press goes nuts. “I’m Steve Inskeep. Cheese-span is reporting that the latest chatter
in cheddar is the cheese cave crisis. Ron Elving has this report.” “The rind is off the government cheese program.” Eventually, Jimmy Carter left office, and
Ronald Reagan was left to figure out what to do with all of this cheese. The government was buying one in every four
pounds of the country’s cheddar cheese. “Well, my God, Jimmy. It’s all cheese.” And the clock was ticking because all this
cheese was starting to get moldy. So the government needed to find a market
for the stuff, and fast. “Well, they have to be careful because of
something called commercial displacement. If they just send a flood of cheese on the
market, they’ll end up hurting the producers they’re trying to help by providing a less
expensive product to meet existing demand.” So the government had the cheddar reprocessed
into new bricks and started giving it away at food banks. The idea was that these consumers probably
weren’t going to buy cheese anyway, so they’re not necessarily hurting the market. And lo, a new pop culture icon was born. “Government cheese makes the best grilled
cheese you done ever had in your life.” “Where do you buy government cheese?” “You don’t buy it, you got to be on their
special mailing list.” “…you’re going to end up eating a steady
diet of government cheese and living in a van down by the river.” The government cheese caves started to empty
out. The guaranteed milk price, which had been
going up automatically every six months, was eventually frozen. But that does not mean the government had
fixed the problem. The thing about price controls is that once
you start them, they are really, really hard to unwind. This is a basic supply and demand problem. The government was demanding an unnatural
amount of milk, and so farmers were supplying an unnatural amount of milk. One part of the solution then was to gently
get that milk supply down. So the government literally paid dairy farmers
to stop producing milk. That did some good. And then on the other side, the government
tried to replace some of their artificial demand for milk with new real demand for milk. Which led to things like — Got Milk? So this weird campaign promise had a hand
in basically the two most important dairy moments in pop culture, and it served as an
instant signifier of a government program gone fully off the rails.

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