I am confused by this statement which appears to be a non sequitur. If it is subsidized then shouldn’t it be artificially inexpensive? Can you clarify?
A. If closer to W: subsidize to lower the price down. Ice cream cheaper in W and at its original price further away
B. If further to W: tax to inflate the prices. Ice cream is at its original price in W and more expansive further away
I cannot see how you could have subsidies AND inflated prices at the same time. Maybe A and B are used simultaneously? More clarification would be appreciated :)
Milk pricing in the US is enormously complicated, but as I understand it, there is effectively a floor on the price of drinkable milk. This keeps some milk producers in business who would otherwise exit the market. As you may know, price floors lead to oversupply, so the government sometimes steps in to buy the excess supply, or will just pay producers to dispose of it.
So yes, as counterintuitive as it sounds, milk is both subsidized and sold at inflated prices
> Though demand is declining, production is not. It has risen 13% since 2010. In 2016, the American dairy industry dumped a whopping 43 million gallons of milk
> The dairy industry received 43 billion and 36.3 billion dollars in 2016 and 2017, respectively, from the federal government.
> It is important that special interests do not acquire billions annually for an industry that knowingly overproduces, not to mention pollutes the environment, in the face of declining consumption
