My name is Harold Brubaker. I am a state legislator from North Carolina. I am pleased and honored to be here today, before this committee and its many distinguished members, and to speak in favor of proposed legislation reauthorizing and extending the Northeast Interstate Dairy Compact and granting consent to the formation of a southern dairy compact.

For the southern states which are trying to form into a compact - much is at stake. Family farmers in the south are threatened with the distinct possibility of extinction. In 1974, there were 1,646 dairies operating in the state of North Carolina. Today, low milk prices and volatile markets have reduced these numbers to a total of 427. During the 1990's, milk price volatility resulted in the accelerated loss of over 400 dairy farms in that decade alone. And these trends are not isolated to North Carolina - much of the south has experienced dramatic decreases in milk production since the 1990s. While the nation's milk production increased 13% from 1990 to 2000 - with 2000 marking the fourth consecutive year of record-breaking milk production, seven of the top 10 largest production decreases in the United States since 1990 occurred in southern states. These southern states lost between 25 and 35% of their milk production in the last decade alone.

Establishing regional compacts will benefit both farmers and consumers. Compacts also benefit the public interest by assuring a stable supply of fresh, regional milk and help to support the now fragile rural ecology that dairy farms provide. It is time to dispel the myth that compacts are government sponsored price fixing cartels - nothing could be farther from the truth. Opponents of dairy compacts forget that the milk market has been regulated by the government since the 1930's. They forget that in the era of mega-corporations consolidating agri-businesses and allegations of price gouging and widening retail and processor profit margins, regional and state milk commissions comprised of consumer representatives and government officials offer the public recourse and scrutiny into milk prices that are fair to consumers and farmers. That is the framework of the compact commission. And perhaps they forget that our country was founded on federalist principles - that states and regions have sovereign rights, as do their state citizens and elected officials, who are concerned about the long-term viability of a distinctly regional product. Even though the Mid-West would no doubt love to supply the entire country with fluid milk - milk is a regional commodity: bulky, perishable, and expensive to transport. In order to protect this regional commodity, which forms the backbone of many rural communities, it is altogether fitting and proper that regional compacts be used to regulate in the public interest. There are currently 35 states interested in compact legislation. No less than twenty-five states, their legislatures, my legislature, and myself have voted to ratify language authorizing our participation in a dairy compact. I ask that Congress give due deliberation to our collective voices.

This legislation also calls to stake a fundamental issue: the ability of states to craft regional and state-based initiatives to problems inadequately addressed at the federal level. Since 1990 alone, Arkansas has lost 36% of its milk production. In light of these numbers, would any member say that state leaders do not have a responsibility to their citizens to use their state governing body to formulate solutions? The principles of federalism are the guiding touchstone behind the value of our political system and it is in these principles that dairy compact legislation lies.

Local experiments by states are in the finest tradition of a Constitution that embraces federalism. Through state program experimentation, new ideas can be tested and refined, programs and initiatives can percolate up to the federal level, where if successful, their innovative techniques can be applied. Congress should be hesitant to choke such an experiment before it has had a chance to fail or succeed on its own merits. And, the results for dairy compacts are quite clear. Since the original six New England states passed compact legislation in 1996, well over half the country has moved toward embracing the idea of regional compacts for control of regional commodities. The compact clause of our constitution anticipates the use of state instrumentalities, like compact commissions, through which matters of regional concern may be addressed through policies shaped by regional values and expertise. We must keep in mind that there are limits to what can be achieved through uniform national regulation, especially when dealing with a regional commodity (such as milk and milk production) that by its very nature impacts each region of the country differently. Regional initiatives under the Compact Clause allow states to furnish a unique yet viable mechanism to respond to regional concerns and values. Congress should not forget this when discussing dairy compact legislation.

Thank you for your time and attention.