Milk may not burn, but it continues to be a flammable political liquid, as reflected in the new federal price support that took effect yesterday.
By order of Agriculture Secretary Bob Bergland, the 1980 support price for milk producers was increased from $10.51 per hundredweight to $11.22.
That means consumers eventually will pay more for a gallon of milk. The debate is over how much more and when.
Bergland's experts at the U.S. Department of Agriculture calculate that the support price increase will add no more than a half-cent per gallon to the consumer's cost -- a small price, they say, for assuring a steady supply.
But the Community Nutrition Institute, a public advocacy organization, contends that Bergland's action along with another increase expected next April will mean a retail price increase of between eight and 10 cents a gallon by spring.
"Unnecessary and unwarranted," said CNI's Thomas B. Smith of the USDA support price increase. "It will be highly inflationary . . . the height of irresponsible regulation."
CNI said the increases would hit the poor hardest in a food category already beset by inflation in the past year -- milk, up 10.7 percent; cheese, up 12.7; butter, up 13.7.
Current market prices of all three items, however, are running well above the government's support levels, which, in a sense, makes the argument academic.
Bergland's decision last Friday to increase slightly rather than cut back the support price, which he is empowered to do, was a follow-up on an earlier promise to congressional agriculture leaders.
The House Agriculture Committee in June reported out a bill requiring milk supports of not less than 80 percent of parity, with semi-annual adjustments. Eighty percent is about where supports are now.
Faced with likely passage of the bill by Congress, Bergland agreed to continue supports at 80 percent until 1980, congressional sources said.
As the support program is set up, producers may sell milk to Uncle Sam at a guaranteed price when market prices fall below that figure.
In testimony before the House Agriculture Committee. Congressional Budget Office Director Alice B. Rivlin said earlier this year that while 80 percent of parity uould provide price stability, it also would mean budget outlays of $600 million for each of the next five years.
USDA witnesses estimated that the government would be purchasing far less surplus diary goods, at an annual outlay of only $400 million.
CNI's Smith, citing figures from a Milk Industry Foundation study, said the government will have to spend $614 million in 1980 and $919.7 million in 1981 if Bergland goes through with his price support plan.
CNI insisted that "this is grossly unfair to consumers and will lead to even greater purchases of unusuable or unaffordable dairy products" by the government.