The Sept. 20 news story on milk price subsidies makes it appear that small farmers throughout the country are pitted against the large-scale well-off dairy farmers of Wisconsin. Not true.

Small dairy farms are an endangered species in Wisconsin as well. Not only do they have low prices to deal with, but also they have to fight a subsidy system that discriminates against them as much as it discriminates against the big dairy operations in the south of the state.

I feel for Kenneth Champlin, the Louisiana dairy farmer who sees the business dying. But unless we come up with a system that aids small farmers, Mr. Champlin's family and the small-farm families of Wisconsin will meet the same fate.

OSCAR CHAMBERLAIN

Rice Lake, Wis.

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I am sorry for the dairy farmers in Louisiana and New York whose future in agriculture is so uncertain--but not sorry enough to endorse regional dairy compacts. Federal dairy policy since the '30s has sought to help farmers by boosting milk prices. Nearly every year since then, the number of dairy farmers in America has gone down--when prices were good and when they were not, when Congress approved new schemes to help raise prices and when Congress did nothing. Obviously milk prices are not the only factor involved.

For example, residential and other development in the Northeast offers many dairy farmers a far better economic return from selling their land than from milking cows. This would be true even if Northeastern dairy farmers got the higher prices promised by regional dairy compacts.

States such as New York and Vermont could compensate for the factors prompting farmers to leave dairying, perhaps by not taxing them or by providing fairly large cash subsidies. State and local governments might find it in their interest to delay farmers' exit from the industry. But no national interest justifies their getting federal help.

Neither price supports nor marketing orders are needed to ensure that consumers across the country have access to milk products, nor have they been for more than a quarter-century.

The Clinton administration has approached this issue timidly. But its dairy marketing order reform proposal is still preferable to a regional dairy compact scheme that seeks to use federal regulation to delay some dairy farmers' exit from agriculture--an effort doomed to be ineffective, on behalf of a cause of no compelling interest to the federal government.

JOSEPH BRITT

Eau Claire, Wis.