Mo’ butter

Norway’s butter shortage illustrates the dangers of monopoly control, argues Andrew Coulson on Cato @ Liberty. The Christmas baking season is at risk for lack of butter. Russian smugglers are trying to bring black-market butter across the border.

Norway’s butter monopolist, Tine, is protected from foreign competitors by government-imposed import tariffs, writes Coulson. That’s why neighboring Sweden has plenty of butter at lower prices.

Angry Norwegians are threatening to dump the butter monopoly. Meanwhile, the U.S. has “its own $600 billion per year government protected monopoly that makes Tine look like small potatoes,” writes Coulson.

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Comments

  1. It’s an inexact comparison in that Norwegians aren’t required to eat butter.

  2. If the thesis is that having the government fund education caused the inflation, a valid comparison would be between the cost of public school education per student (controlled for special education costs) and private school tuition.

    Frankly, it’s difficult to believe Coulson wasn’t presenting this as an intentionally absurd comparison.

  3. I don’t know, that chart is pretty damning. Name another product or service that has seen that kind of (mis)performance. I can’t think of one.

    Also, the idea that “government funding” caused this is a straw man. It’s not the “government” part, it’s the “monopoly” part that counts.

    • All the chart indicates is that costs have risen – it tells us absolutely nothing about why costs have risen, nor does it offer any basis for the implicit assertion that test scores should have been impacted by the additional expenditure. If we’re making international comparisons, it sheds no light on whether other nations that supposedly have better schools have avoided similar cost increases for K-12 education. If we’re making domestic comparisons, it makes no effort to demonstrate that private K-12 education has avoided the same cost increases or that private schools have seen a greater improvement in test scores.

      And it has absolutely nothing to do with the price of butter.

      • Although this should not have to be said, the nation is full of private schools – secular and parochial – and an increasing number of independently operated charter schools – so let’s not pretend that the government has a monopoly on K-12 education.

        In terms of industries that have seen a similar cost increase, think any industry that has not found a way to reduce the number of employees required to provide services. Have you ever seen a graph of health care inflation, for example?

    • It’s a bit of both, Rob.

      Monopolies naturally raise prices above market rates that being a good deal of the reason for monopolies. But a monopoly without government protection is just a great, big bullseye. Everyone who wants to make a buck will see the monopoly as a target. That’s why monopolies, absent government protection, never last very long.

      When a monopoly does have government protection though all sorts of delightful possibilities emerge. Throwing your competitors in jail. Seizing their assets. Shooting them. Mandating purchase of your product.

      The advantage of government, i.e. tax funding is that the “customer” is stripped of the buying decision. Whether you want it or not you pay.

      Increasing the level of funding is a matter of political influence not due to an increase in the perceived value of the offering or its scarcity.

  4. Yawn, an old news story that completely ignores the costs associated with federally mandated Special Ed programs.

    Joanne is re-running all the old anti-public school propaganda.

    Next up will be the claim that teachers are academically inept. SPOILER ALERT, its based on a survey of high school students who said they were considering a career in education.