Tuesday, January 29, 2013

Got Milk? Laissez faire be damned!

I'm confused.

Isn't Louisiana supposed to be a normally conservative Republican state? And don't Republicans portray themselves as the stalwarts of free-market capitalism? And aren't the Republicans currently beset with the Tea-Party, the same Tea-Party that champions self-determination and derides intervention by government in business?

Then why is the Louisiana government preventing a super-market from selling milk below cost? Why aren't the conservative zealots all over this case? Why aren't the Republicans shouting themselves hoarse pontificating the ills of the coercive authority of the government?

What happened?

A Louisiana supermarket was forced to yank its low-cost milk special after state auditors objected to the price.

Fresh Markets in Perkins Rowe was selling milk for $2.99 a gallon as part of a weekly promotion deal, but Louisiana requires that retailer markups be at least 6 percent above invoice and shipping costs, The Advocate reports.

State Agriculture and Forestry Commissioner Mike Strain said Fresh Market violated state regulations by selling milk below cost as part of a promotion.

The supermarket routinely sells a gallon of skim, 1 percent, 2 percent or whole milk for $2.99 on Tuesdays, limiting the quantity to four per customer, according to The Advocate.

“They can sell it 6 percent over cost all day long. It’s when they sell it below cost that it becomes a problem,” Strain told the paper.
Seriously, what happened? Is it an anti-trust thing? How is the super-market being anti-competitive?

If the fact that the above article is from Fox News, here're some more sources (are all these sources owned by Fox? I don't know)
BRAVE released a prepared statement from Drewry Sackett, Fresh Market’s marketing, public relations and community relations manager.

“Because milk is a commodity product with regulated costs that are subject to change, at the current cost, due to Louisiana state law, we are unable to honor the $2.99 Tuesday deal for (Fresh Market) milk ... Because the cost of milk fluctuates, it is possible that we will be able to offer the $2.99 deal on milk again in the future,” Sackett said.
To make things even more confusing, the “price floor” doesn’t represent a set price – it’s based on a percentage of what the retailer paid for it. That explains why Winn-Dixie was able to sell milk for $3 in Louisiana last week, while Fresh Market couldn’t sell it for $2.99. If Winn-Dixie (orWalmart, or ALDI) can acquire it for less than the Fresh Market does, it can sell it for less than the Fresh Market.