Let’s step back from maple syrup for a minute. A price-fixing cartel is an agreement among producers to reduce supply in order to maintain a high price. Producers face two classic problems in doing this. One is deciding whose supply gets restricted. The other is that once they deliver a high price, members have an obvious incentive to increase production, which (of course) undercuts the point of the cartel. So the question is how to determine and enforce supply limits.
One of the most effective ways is to get the government to do it for you. Which brings us to maple syrup. Our Montreal correspondent Allan Collard-Wexler sends this wonderful piece from Canada’s National Post. Some of the highlights (lightly edited):
- Backed by the Quebec justice system, sheriffs have raided sugar shacks down country roads and seized barrels of maple syrup. Their goal: enforcing a supply management system that controls the sale and proceeds of maple syrup in Quebec.
- Meanwhile, producers whisk away their sweet liquid by night, trade in “black market syrup” and rage against what they call the “mafia” of the producers’ union.
- “It’s worse than drugs,” says [black market producer] Grenier. “There’s not a single pusher who would get pursued like this.”
And yes, it’s a little odd for the government to enforce an agreement like this, when the point of competition policy is the opposite.