Government and the Dairy Industry

Government intervention within the dairy industry is nothing new. This has been happening for decades, and it’s time we put an end to it. We are done with living under dairy’s thumb. We cannot hold on any longer. Someone has to tell the truth. Someone has to change. And we’re the ones to do it. Together. Keep reading to learn more about the taxpayer-funded relationship between the government and the dairy industry and what Switch4Good is doing to confront this.

Government Dairy Bailouts

The USDA allocated $120 million to purchase excess dairy during the 2020 coronavirus pandemic. This amount more than doubled the funds dedicated to any other agricultural product. (1)

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The dairy industry has relied on government bailouts for nearly a century. Following WWI, a milk surplus hit dairy farmers hard. Throughout the 1930s, dairy farmers staged several strikes and unionized to demand a fair price for their milk. (2) To appease these farmers, the government created federal programs to artificially drive demand. The first of these programs included the 1940 Federal Milk Program for Schools and federally subsidized milk advertising under the Works Progress Administration. In 1946, President Truman passed the National School Lunch Act, which mandated each lunch include between 1 ½ to 2 pints of whole milk. In essence, since adults weren’t buying milk, the government solution was to force it onto their children. To this day, children who participate in the National School Lunch Program—which offers free or low-cost lunches to students of low-income families—are required to take a carton of dairy milk. (3)

In the 1970s, the government used taxpayer funds to purchase excess milk outright. In 1977, President Jimmy Carter allowed $2 billion federal dollars to be funneled into the dairy industry over the course of four years. (4) This soon-to-rot milk was homogenized into “government cheese” and held in vast underground storage units across 35 states. Not only was this a waste—it was also expensive. In 1982, a New York Times reporter stated that the federal government would spend $40 to $50 million transporting this surplus dairy, and another $40 to $50 million to store it. (5) By this time, the government was spending $2 billion in taxpayer dollars annually to purchase, transport, and store excess milk.


1. Agricultural Marketing Service. USDA Announces Additional Food Purchase Plans. Published May 4, 2020. Accessed November 15, 2020. https://www.ams.usda.gov/press-release/usda-announces-additional-food-purchase-plans
2. “Historical Timeline – Milk.” ProCon.Org, 10 July 2013, https://milk.procon.org/view.timeline.php?timelineID=000018.
3. “School Meals – FAQs.” USDA, 27 Feb. 2019, https://www.fns.usda.gov/school-meals/faqs.
4. Blakemore, Erin. “How the U.S. Ended Up With Warehouses Full of ‘Government Cheese’.” History.com, A&E Television Networks, 26 July 2018, https://www.history.com/news/government-cheese-dairy-farmers-reagan.
5. King, Seth S. “Warehouse Bulge With Surplus Cheese, Butter, and Dried Milk .” The New York Times, The New York Times, 6 July 1982, https://www.nytimes.com/1982/07/06/us/warehouses-bulge-with-surplus-cheese-butter-and-dried-milk.html.

Government Dairy Subsidies

The USDA provided $2.9 billion in direct payments to dairy farmers under the Coronavirus Food Assistance Program of 2020. (1) This is in addition to the $120 million spent to purchase excess milk that same year.

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The US federal government oversees eight different subsidy programs to support the dairy industry. Many of these use taxpayer funds to subsidize dairy farmers (with the exception of the two checkoff programs). These programs attempt to control milk and feed prices, reimburse farmers for excess milk donation to nonprofit organizations, purchase excess milk, and establish insurance policies to artificially bolster the industry. In 2018, 42 percent of the dairy industry’s revenue came from government support. To learn more about each specific program, visit the USDA Economic Research Service website. 


1. Cessna, Jerry. Economic Research Service. Policy. Updated August 3, 2020. Accessed November 15, 2020. https://www.ers.usda.gov/topics/animal-products/dairy/policy.asp

Dairy Checkoff Program

The government-run dairy checkoff program led to the invention of Pizza Hut’s stuffed crust pizza. $91 million US dollars was spent to market and promote dairy in 2018 alone. (4) 

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The Dairy Checkoff Program—also known as the National Dairy Promotion & Research Board—is an industry-funded, government-controlled program to promote the sale of dairy products. Its responsibilities include dairy product promotion by way of marketing, research, and nutrition education. US dairy farmers and dairy importers collectively fund its initiatives by paying a tax based on the weight of the total milk they sell. Dairy Management, Inc (DMI)—with oversight by the USDA—manages these funds and channels it into regional and national dairy promotion programs.

One strategy heavily employed by DMI is corporate partnerships. DMI has worked with several chain restaurants to encourage their kitchens to add more dairy-derived options to the menus. For example, Pizza Hut’s stuffed crust pizza, Domino’s 40 percent more cheese pizza, and Taco Bell’s Quesalupa and Quesarito all came into existence through the funding of the dairy checkoff program. Other companies such as McDonald’s and Starbucks have also received checkoff funds (now we know why the PSL is still not dairy-free in the US only). (1,2,3)

The checkoff program also funds national campaigns such as Got Milk? and Built with Chocolate Milk. The scientific studies used to back up these promotional claims are also industry funded. The image of kids growing big and strong with a glass of milk by their side, athletes crossing finish lines with milk mustaches … all those wholesome feeling surrounding dairy were carefully curated and strategically fed to Americans just to support a dying industry.

And the government plays a role in all of it.


1. Wallin, Scott. “Checkoff Scientists Help McDonald’s USA Create Dairy-Focused Offerings.” Dairy Management, Inc, 23 Mar. 2018, https://www.dairy.org/news/checkoff-scientists-help-mcdonalds-usa–create-dairy-focused-offerings.
2. Philpott, Tom. “The Real Reason Pizza Hut Just Rolled out the Extra-Cheesy.” Mother Jones, 8 Mar. 2018, https://www.motherjones.com/food/2018/03/dairy-glut-pizza-hut-trump-dominos-checkoff-taco-bell/.
3. Dickrell, Jim. “New Starbucks Drinks Use Dairy Protein.” AgWeb, Farm Journal, 29 Aug. 2008, https://www.agweb.com/article/New_Starbucks_Drinks_Use_Dairy_Protein__204990.
4. MilkPep Annual Report. 2018. https://milkpep.org/wp-content/uploads/2019/12/AnnualReport2018FINAL_USDA-Approved.pdf

US Dietary Guidelines

Dairy—a food that makes at least one-third of Americans sick—is still considered an essential food group based on the US Dietary Guidelines for Americans.

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The US Dietary Guidelines recommend all Americans consume at least three servings of low-fat dairy every day. Despite the overwhelming evidence that dairy can do more harm than good, this recommendation has been approved by the USDA and HHS for each revision of the Guidelines (every five years). Thirty-six percent of Americans are lactose intolerant with even higher rates (between 70-95 percent) amongst BIPOC communities. (1) Those who are lactose intolerant cannot properly digest dairy and experience uncomfortable symptoms such as bloating, diarrhea, gas, and abdominal pain every time they consume dairy. If they were to follow the recommended three servings a day, they would constantly be in a state of physical distress. When a food makes over one-third of Americans sick, how can it be considered a necessary food group?

The Guidelines were revised in 2020, and Switch4Good rallied the public to remove dairy as a food group. We made history by flooding the public comment section—over a quarter of the public comments were in favor of removing dairy. That kind of majority has never been seen before in regards to the Guidelines. The 2020-2025 US Dietary Guidelines still lists dairy as a food group, but also offers fortified soy milk as a nutritionally equivalent alternative for the first time in history. We consider this a significant step forward, and we will continue to push for dairy alternatives in both private and public businesses, schools, and hospitals. 


1. U.S. National Library of Medicine. Lactose intolerance. MedlinePlus.gov. Accessed November 17, 2020.

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