police power are not reasonably adapted to accomplish these legitimate ends (i. e., protecting the health, morals and welfare of the community) and constitute a direct burden. upon interstate commerce, they must fall."15

Small towns as well as large cities place definite limits on the area from which they will accept shipment of dairy products. In a study recently completed, R. G. Bressler, Jr. shows that three Massachusetts towns follow this plan. He points out that grade B milk for Haverhill must be produced within 40 miles of the town, for Walpole within 30 miles, and for North Attleboro within 8 miles.16

Some eastern cities that have strict milkinspection regulations accept outside inspection of their cream supplies. Boston, for example, furnishes an important market for western cream and accepts outside inspection. However, for a part of 1930 the city of Boston did exclude western cream through inspection requirements. But the experiment was soon abandoned partly because of public protests and the failure of other parts of the metropolitan area to follow Boston's lead.

For many towns or cities the limitation of the inspection area is on an informal yet effective basis. The board of health, usually elected or appointed locally, may find it desirable to cooperate with local producers or distributors 17 in restricting the inspection area. This limitation may take the form of refusal to inspect outside a certain radius. Thus, a local producers' association near a small New England town cooperates with the local health authorities to make sure there are no inspections at a greater distance than 3 miles from the town, but there is apparently no official ruling to this effect.

Instead of refusing to inspect beyond a given number of miles, the authorities may use less obvious methods. Obstacles may be raised to 15 Miller v. Williams, 12 Fed. Sup. 241 (1935).

16 BRESSLER, R. G., JR., LAWS AND REGULATIONS GOVERNING THE PRODUCTION OF GRADE B MILK IN NEW ENGLAND. (Issued by the New England Research Council on Marketing and Food Supply), Boston, 1938. (Mimeographed.)

17 Limitation of total milk supplies for a given area may redound to the advantage of certain established distributors, for new distributors and competitors of the larger distributors may find it difficult to secure adequate supplies of milk as a result of the application of Sanitary laws.

the licensing of new producers. Inspection may be promised but indefinitely delayed, or higher standards may be required of new producers who wish to enter the milkshed than are required of those already licensed. Thus, farmers seeking to enter the market may be discouraged by being told that certain expensive alterations in their plant or certain new equipment will be required before permits will be issued. An authority on the economic problems of the dairying industry on the West coast has written us as follows:

"The city of San Francisco permits only the distribution of pasteurized milk or certified milk. Along with producers' associations and distributors the city inspection authorities place impediments and obstacles in the way of new producers or new areas coming into the market. These obstacles take the form of unwillingness to extend inspection services to new areas or extra stringent regulations or rules regarding milk houses, barns, and refrigeration. Producers who may want to get into the market are in normal times deterred by these arduous requirements or difficulties. Similar conditions are found in many cities other than San Francisco."

A press release issued by the United States Department of Justice, dated July 7, 1938, describes how sanitary regulations may raise barriers to trade. It says in part:

"... A frequent method of erecting such a barrier was by limiting the number of farms which could be inspected and certified by the health authorities in a given milk shed. In some cases municipal ordinances prevented farmers located beyond an arbitrarily selected area from obtaining licenses to ship milk to the city in question. More often, however (and this is true in the Chicago area), the area in which farms could be inspected was left to the sole and uncontrolled discretion of the health authorities. This resulted in a condition under which farmers able to supply milk of the required grade were denied a market under ordinances ostensibly directed at sanitation.

"This development gave local boards of health not only sanitary control over the quality of milk, but economic control over the price of

milk, because they regulated the supply. It created enormous political pressure upon such boards. Gradually their part in the milk price structure became openly admitted at public meetings..."

Especially for small towns, a great deal of discretion as to which producers shall be inspected may rest with the local inspector. He is likely to be on friendly terms with nearby dairymen and to favor retaining the market for local producers. In some jurisdictions his remuneration comes directly from local dairymen. He is often a producer himself and, if so, probably also a member of the local producers' organization. Moreover, his salary for parttime employment as milk inspector is often so small that he simply cannot afford to travel appreciable distances to make farm inspections.

The local milk inspector may even determine which producers' farms he will inspect, on the basis of retaliation against limitation of inspection areas by other authorities. Thus, the case is reported to the authors of a Massachusetts inspector who stated he would continue to inspect the farms of those producers across the line in Connecticut who had already received licenses, but, as Connecticut was refusing to inspect dairies in Massachusetts, he would not inspect any for new Connecticut producers.

Although the general public is often unaware of these informal market limitations, those in the industry usually understand the situation and often give such restrictions their open approval. The case may be cited of a statement made at a meeting sponsored by the milk control board of a New England State. A member of a milk producers' association who addressed this meeting gave enthusiastic approval of restriction through health measures. The Springfield Republican reported him as saying:

"The attitude of the board of health is the key to success in producing a situation in which the surplus milk problem is brought to the vanishing point. This desirable result is produced by refusal of the board of health to approve dairies outside a certain radius." 18

The secretary of the Maryland Cooperative

18 October 16, 1935.

Milk Producers, Inc. expressed his approval of the situation under the Baltimore regulation which prohibited the bringing of cream into the city from a distance greater than 50 miles. In his annual report of January 26, 1935, he said: "Due to the high quality of our product we were able to market 3,148,574 gallons of milk in the form of cream to local ice-cream manufacturers during the past year. Through the cooperation of the health department the use of cream produced in other areas, not under their direct supervision, is prohibited at all times when this market has an ample supply. This protection to our market is very important, and especially so during the past year when most eastern markets were glutted with western cream, selling at times at a very low level." 19

A common practice for States as well as for many cities is to limit the area in which inspection is conducted at public expense. Producers outside this area, or more often the distributors who buy from them, must themselves cover all inspection costs. The problem is especially serious in the case of cream, which may be shipped 800 or 1,000 miles to an eastern market. Often the eastern State or city is unwilling or unable to bear the heavy costs of sending officials to inspect dairy farms in the Middle West, and, obviously, western farmers cannot individually finance such inspection. To some extent inspectors' expenses (usually $8 per day plus traveling costs) have been paid for by producer or distributor organizations. For example, such groups have paid inspectors from Cleveland and Baltimore and from the State of Pennsylvania to go to Wisconsin to inspect dairies.

Even where shippers of western cream are in a position to cover this inspection cost, they may be confronted with difficulties in persuading eastern public authorities to provide the inspectors. In such cases the western dairymen are inclined to believe that the refusal to provide inspectors is deliberate and designed to keep western cream from the eastern market. On the other hand, the eastern city or State may

19 Quoted in the Report of the Federal Trade Commission on the Distribution and Sale of Milk and Milk Products, Boston, Baltimore, Cincinnati, St. Louis, 74th Cong., 2d sess., House Doc. No. 501 (1936), p. 47.

claim, honestly enough, that, with a limited staff, it cannot afford to cripple its local inspection force by sending its officials on long western trips, even if distributors or manufacturers are willing to bear the expense. At best, these western inspection tours can be made only at relatively infrequent intervals, so the officials of Eastern States or cities are likely to assert that they cannot have complete confidence in the quality of western cream.

This difficulty is avoided where, as in the case of States like Rhode Island or cities like Boston, the eastern market authorities are willing to accept the inspection and certification of the public authority established in the area where the cream is produced. The usual reason given for the refusal of certain eastern governmental units to accept outside inspection is that they have developed high standards that they believe can be adequately protected only by their own carefully trained personnel. They think that elaborate inspection laws signify little unless accompanied by rigorous enforcement. Without question this view is often sincerely held. But we must note that those areas which may gain most through market restrictions are usually those most uncompromising in holding to this position. Moreover, the logical position of those cities or States that set very high standards and insist on their own inspection for their fluid-milk supply is somewhat weakened in those cases in which, for cream or other dairy products, they readily accept inspection by outside agencies, if indeed they require for them any farm inspection at all. It is worth noting that some States and cities that set up expensive and elaborate arrangements for inspecting the sources of supply of their fluid milk give much less attention to similar safeguards for other dairy products, like cream and ice cream. No investigation of the technical evidence concerning possible danger to public health through contamination of these products was possible in connection with this study. But there appears no good reason why, purely from the standpoint of public health, any city should set very high standards for fluid. milk and at the same time make little or no provision for inspecting other dairy products.

Nor does there appear on similar grounds clear reason for refusing to accept outside inspection in one case and not in the other.

Some areas have constantly raised their standards for the production of fluid milk. In any given case it would probably be impossible to tell in what degree this resulted from attempts to exclude outside milk or from a sincere desire to improve the quality of the product. But supposing the latter motive to be dominant, there is serious question from the social point of view as to how high these standards should be permitted to go. It is at least arguable that health protection beyond a certain degree may cost more than it is worth. Sanitary experts are loath to concede that there can be too much regulation in the interest of protecting health. Yet a commonsense view may hold otherwise on occasion. When it is found, for example, that refinements of regulatory procedure cause milk to sell regularly at 1 and 2 cents a quart more than in other nearby well-regulated cities (as is the case in the District of Columbia), the ordinary consumer may wonder if this additional item of protection is fully justified in terms of public health. Low-income families who can afford little and frequently no milk for their children might bear witness to the adverse public-health effects of an inspection program that helps to hold milk out of their reach.

One other type of market limitation that comes under the heading of health regulations is that having to do with pasteurization and transportion to market. Utica, N. Y., in 1932 required that no new permits should be issued to milk distributors unless they had a processing plant within the city limits. A number of other cities, including Milwaukee, Wis., now have a similar requirement. Massachusetts requires that all grade A milk must be pasteurized and bottled within the State. A Minneapolis ordinance requiring pasteurization within the city limits was declared unconstitutional by the State Supreme Court.20

Rhode Island stipulates that normally all milk

Summary Report on Conditions with Respect to the Sale and Distribution of Milk and Dairy Products, 75th Cong., 1st sess., House Doc. No. 94 (1937), p. 18.

shipped into the State shall go directly from the farm where it is produced to the consumer or dealer within Rhode Island. The disadvantage of this law to farmers located any appreciable distance from the Rhode Island boundary is obvious. If milk is delivered in violation of this Rhode Island law the commissioner of agriculture of the State is empowered to add colored vegetable matter to this milk so that it may be easily identified. On August 10, 1937 such action was taken and red coloring matter added to 5,000 quarts of milk from Bellows Falls, Vt. This was widely protested and court action was begun by the interested distributors. Pending a court ruling, Rhode Island has made no further move to add color to out-of-State milk.21

OTHER DAIRY PRODUCTS

Once a system of inspection is set up for fluid milk and cream, the present trend appears to be toward extending such inspection to all dairy products including ice cream, ice-cream mix, cheese, and butter. Actually the specific dairy products to which inspection requirements apply vary greatly from one public authority to another. Some cities apply inspection requirements to cream for table use only, others to all cream but not to ice-cream mix. Apparently the frequent leniency in respect to ice-cream mix is accounted for by the fact that it cannot be easily reconverted into such form as to find its way into local markets in competition with table cream. This seems to have been the purpose underlying the Pennsylvania law of 1933 which provides that—

"No milk shall be sold for ice cream making purposes from sources which have not been inspected and approved by the secretary, unless such milk shall be denatured by having sugar added. . . ."22

Some States and cities have made their inspection requirements all-inclusive and may require

21 The Dairymen's League News, August 24, 1937, p. 13, and the Providence Journal, August 11, 1937. In view of the indignant protests that came from Vermont over the coloring of their milk, it is of interest that 48 years earlier Vermont had sought to protect its own dairymen by a strikingly similar method. In 1890 Vermont adopted a law requiring that all oleomargarine sold in the State should be colored pink.

23 Laws of 1933, Act 123, sec. 3.

inspection at the source by their own inspectors of all dairy products. The States of New York and Pennsylvania and the city of Cleveland have such inclusive legislation.23

An interesting development has to do with the required inspection of the farm source of supply of evaporated, condensed, and dry milk. These products are ordinarily processed at a temperature much higher than that commonly used in pasteurizing fluid milk. There is a strong presumption that all harmful bacteria are destroyed at the higher temperature. At least no authoritative studies have indicated, so far as we know, any real danger from the presence of bacteria in these products. On the other hand, there is something to be said for clean milk in whatever form it may come. Sterilized dirt may be wholesome, but it lacks esthetic appeal. However, the general cleanliness and wholesomeness of good brands of evaporated or dry milk appear unquestioned. At least, physicians often recommend their use for small babies.

Producers and distributors of fluid milk have become increasingly disturbed over the competition from condensed or evaporated milk. A recent study shows that for this country consumption of evaporated milk which amounted in 1923 to 7.6 percent of the consumption of fluid milk had increased to 11.7 percent in 1936. Accompanying this increased consumption of evaporated milk was a marked increase in the spread between the price of evaporated and fluid milk.24

Pennsylvania is apparently the only State which requires inspection by its officials of the farm source of supply of all concentrated milk sold in the State. Ice-cream manufacturing companies of Pennsylvania that use dry milk must either purchase this product from Pennsylvania producers or procure it from companies that have gone to the expense of financing Pennsylvania inspection of their western farm sources

23 The New York State law does not apply to dairy products in hermetically sealed containers.

* Consumers' Guide, June 6 and 20, 1938, pp. 14 and 18. See also BARTLETT, R. W., HIGH MARKET MILK PRICES REDUCE MILK CONSUMPTION, Illinois Farm Economics (monthly publication of the Ill. Coll. of Agr.), March-April 1938, pp. 162-163.

of supply. The city of Cleveland, Ohio, has similar regulations. All evaporated and condensed milk sold in this city must come from farms inspected by Cleveland officials. As a result, at least one company engaged in the sale of these commodities has had to shoulder the expense of sending Cleveland officials to inspect Wisconsin farms.

In addition to the movement for inspection of the farm source of supply of concentrated milk, there has been some agitation in favor of legislation forbidding the sale of such milk unless from cows certified to be free from tuberculosis. The States of Washington and Utah already have such legislation and the legislatures of several Eastern States have seriously considered such measures.

Various other measures have been adopted which, whether or not such is their purpose, may discourage the consumption of evaporated and condensed milk. The Pennsylvania State Department of Agriculture administers a law which prevents the use of dry milk in the manufacture of sausage. Georgia has placed a sales tax of 5 cents per pound on dry milk when the product is used for producing fluid milk. Recently agitation has appeared in certain Eastern States for the passage of State laws that would require labels on food products showing the point of origin. Such labeling laws would, of course, make more effective the buy-at-home campaigns.25 The similarity is striking to the Federal requirement that in foreign commerce imports must be clearly marked with the country of origin.

One final aspect of the restrictive effect of health and sanitary regulations on dairy products should be mentioned. The insistence of cities and States upon their own regulations and inspection by their own officials reaches rather absurd limits in areas where production is normally carried on for more than one market. Reports from ice-cream manufacturing plants in many parts of the country indicate that their farm sources of cream supply are often subjected

25 A bill introduced in the Connecticut Legislature in 1937 provided that all milk produced and sold in the State should be labeled "Connecticut product."

to inspection by 3, 4, or even more State, county, or city health departments. Cities often refuse to accept the inspection reports of their own State official, and neighboring counties or townships refuse to enter into reciprocal inspection agreements. In its investigation of the New York milkshed the Federal Trade Commission found that:

"Usually each State, subdivision of a State, and municipality, insists on making its own inspection and will not accept inspections by authorities of other jurisdictions. Operators of country receiving plants and farmers supplying them sometimes find it necessary to submit to as many as seven or more separate inspections.”26 A Vermont State official writes:

"The utter lack of uniformity in sanitary inspection requirements among the States into which our dairy products are shipped is a serious handicap to Vermont dairy interests. It is a source of constant difficulty and annoyance and if these requirements could be made uniform it would be very helpful indeed."

Occasionally a really absurd situation has arisen when farmers or receiving-plant operators have found that in order to conform with the requirements of one authority they must violate those of another.2 27