Canadian Cheese Smuggling?

Danielle Goldfarb:

Police recently arrested three men, including one current and one former police officer, as part of a massive cheese-smuggling ring. The perpetrators allegedly smuggled cheese across the Canada-U.S. border and sold it to Canadian restaurants at a six-figure profit.
This sounds like the plot of a bad movie. It’s not. It’s the result of Canada’s long-standing dairy policy.
In contrast to other food products in which the market sets prices, Canada has an almost forty-year government policy of “dairy supply management”. In essence, the system limits milk production and keeps dairy imports out, in order to provide producers with higher milk prices. (A 2009 Conference Board report Making Milk: The Practices, Players, and Pressures Behind Dairy Supply Management examines how the policy works in practice in more detail.)
The system is riddled with complexities and idiosyncracies. To top their pizzas, restaurants buy “white gold” (mozzarella cheese) that is made from milk that costs cheese processors at least two times more than the same raw milk used to make other dairy products.
What about cheaper imports that undercut domestic production and prices? Ottawa has rules to keep them out. For example, only one-twentieth of Canadians’ cheese consumption is allowed in; the rest is subject to a 246% tariff (see chart). We allow in even less yogurt and other dairy products.

This is a good example of bad government policy.  In some instances, Canada has maintained better government policies than the United States.  This is not one of those cases.