Is Plant-Based Milk the New Margarine?
Over a century ago, the butter industry tried to drive margarine makers out of business. Looks like history is repeating itself.
In many states across America, margarine was once dyed black or pink. That was mandated by law; the goal was to stop people from buying it. Other laws jacked up taxes on margarine, making it unaffordable. This was the 1880s—a time in which the butter industry was full-on freaking out about this new competitor, and politicians came rallying to its defense.
Now, 134 years later, history may repeat itself with a different dairy product. Milk sales in the U.S. dropped $1.1 billion last year, and thousands of dairy farms are closing. That’s why politicians across the country, including in Washington, are trying to stop plant-based beverages from using the word milk. Soy milk, almond milk, oat milk—all these terms would be outlawed. “Imposter products,” wrote six U.S. senators in a letter recently, must be stopped from “taking advantage of dairy’s good name.”
But before anyone passes a new law, they may do well to look back at history. The economic term for what’s happening here is regulatory capture—that is, an incumbent industry passing laws to protect itself—and regulatory capture did not work out well when the butter industry declared war on margarine. There’s no reason to think that this time will be different.
Here’s the thing to know about margarine: At first, it was not the stuff we know today. The French Emperor Napoleon III wanted a butter-like substance that could travel easily with his soldiers, and offered an award to anyone who could make it. In 1869, a chemist named Hippolyte Mège-Mouriès succeeded—creating a concoction out of beef tallow that he named oleomargarine. A new food was born.
Oleo (as it was often called) made its way to America, and people liked it. By 1874, the butter industry was on alert. An industry group declared that every measure must be taken to ensure “supremacy of the dairy in our agriculture”—and so, they hit the streets. They started fear campaigns, trying to convince people that margarine was unsafe. By the mid-1880s, 17 states passed some kind of law to regulate margarine, and seven states outright banned its manufacture and sale. In 1886, Congress passed the Oleomargarine Act, which made the stuff far more expensive to produce and sell. “If I could have the kind of legislation that I want,” said William Price, then a republican congressman from Wisconsin, “the law would utterly destroy the manufacture of all counterfeit butter and cheese.”
Was he going for a pun there with utterly? That’s lost to time. But no matter: The butter industry saw just how far politicians would go to defend it, so it kept pushing. Lobbyists convinced many states to dye margarine an unappealing color—usually pink or black, but also red and brown—so that it would look unappetizing.
All this seemed like an enormous victory for butter. So, what was the downside?
First, there’s the question of who was being helped. Dairy farmers beat back their competition, but poor Americans suffered as a result. “If you're thinking about the early 19th century working-class person, what they had to eat was a crust of stale bread,” says Megan Elias, the director of gastronomy at Boston University. “And putting some kind of fat on that not only made it go down a little easier, but it also gave them nutrients that they weren't getting otherwise.” These people may have preferred butter, but that was rarely an option. Butter was prohibitively expensive back then, and, because this was an era before refrigeration, there was no way to store it for long anyway. Margarine was a rare, accessible nutrient for the poor—and now it was gone.
Also, some of these laws violated the constitution. In one case, a margarine manufacturer sued the state of New Hampshire, which had forced all margarine to be dyed pink. The case made its way to the Supreme Court, which in 1898 issued a ruling that stated the obvious: “Pink is not the color of oleomargarine in its natural state.” If states could dictate margarine’s color, the court said, what’s to stop them from making margarine smell bad too? No, the court said—all states can do is prohibit manufacturers from dying their margarine yellow (which was done to look like butter). So that’s what happened: From then on, margarine was often sold as white.
But then there’s the thing companies truly can’t control: culture. Margarine developed an air of exoticness, which made people want it more. People would sneak it across state borders, into places where its sale was banned. And margarine companies found a clever workaround to the coloring laws: Even though they couldn’t dye the product yellow, they could include a packet of food coloring in the jar—and let consumers mix it in themselves. Kids loved that, and quickly confused it with butter. “This is a generation growing up with the idea that butter was this white thing that you mixed yellow color into,” says historian Elaine Khosrova, author of the book Butter: A Rich History.
By attacking margarine, butter lost control of its own narrative. Then things got worse. State and federal anti-margarine laws began to fall away in the 20th Century—and were almost entirely eliminated during World War II, when butter became scarce and margarine was plentiful. Then, starting in the 1950s, butter became the subject of health scares: People worried that animal fat was unhealthy, so they flocked to margarine, which was made with vegetable oil. As a result, Americans consumed more margarine than butter for five decades. (Of course, today’s nutrition experts consider butter to be far healthier than margarine.)
All of this should make today’s dairy producers pause. Politicians may be controllable, but consumers are not—and they’re ultimately more powerful. Dairy alternatives were estimated to be a $11.9 billion market in 2017, and that’s expected to grow to $34 billion by 2024. Why? Maybe people like that it’s more eco-friendly than dairy, or it fits with their lifestyles and evolving health attitudes, or maybe they just like the taste better.
Whatever the case is, it’s almost certainly not because consumers are confused about the word “milk.” If that’s all the dairy industry can think of to protect itself, then it’s about to go down a long, slippery, buttery road.