The far lower price of margarine (about half that of butter) quickly made it popular in Northern Europe and North America.  In 1871, the U.S. Dairy Company began manufacturing margarine in New York City.  In March 1874, Harper’s Weekly reported that two factories in New York produced 19,000 pounds of margarine daily, and eight million pounds had been consumed in the United States within the past year.

Butter producers were quick to rally their troops and declare war on the new competitive threat.  The dairy industry undertook a marketing campaign to convince politicians and the public that margarine was unhealthful and was being improperly sold as butter.  As Harper’s Weekly sarcastically reported in 1880, “Affrighted epicures are informed that they are eating their old candle-ends and tallow-dip remnants in the guise of butter …” The dairymen even claimed that diseased animals were the source of the product’s fat.  In 1877, the state legislatures of New York and Maryland passed laws regulating margarine manufacturing and sale.  By the mid-1880s, 17 states regulated the packaging and labeling of margarine, and 7 states—Maine, Michigan, Minnesota, New York, Ohio, Pennsylvania, and Wisconsin—prohibited its manufacture and sale.    

The margarine industry did not take the challenge passively.  In 1880, the Commercial Manufacturing Company hosted members of a House agricultural subcommittee in New York City.  They gave the congressman a tour of their margarine factory, followed by a dinner at the city’s posh restaurant, Delmonico’s, where margarine was used in the dishes.  The subcommittee also visited a butter factory.  The next year, Commercial Manufacturing Company placed advertisements in newspapers, under the title “Let There Be Light,” which attested to the purity of their product and invited any government official, Board of Health member, or private citizen to tour their factory unannounced at any time.

The dairy industry was able to convince the New York legislature to ban yellow-colored margarine, but margarine manufacturers sued, and in 1885 a New York court overruled the prohibition.  As a result, butter producers concentrated their efforts on Congress, with Senator Warner Miller of New York as one of the anti-margarine champions (making him popular in rural New York).  In 1886, Congress passed the Margarine Act, which imposed steep annual fees for licenses on manufacturers ($600), wholesalers ($480), and retailers ($48), and a tax of two cents per pound on the product.  Many Southern congressmen opposed the bill because cottonseed oil was used to produce most margarine.  President Grover Cleveland, former governor of the electorally powerful state of New York, signed the bill into law. 

The lack of enforcement mechanisms undermined the effectiveness of the law.  Furthermore, the U.S. Supreme Court nullified those portions of the law that interfered with interstate commerce.  The battleground returned to the states, and over the next few decades, legislatures prohibited the use of yellow coloring in margarine (while two states mandated it be colored pink).  Similar laws were passed in other countries.

In 1902, Congress passed a tax on margarine five times higher than the 1886 act, and two years later the Supreme Court upheld the law’s constitutionality.  By that time, the nation’s high court was ruling that the traditional authority of state governments to regulate for health, safety, welfare, and morality (the “police powers”) could be assumed by the federal government as well.  Despite such governmental obstacles, the use of margarine continued to spread.  Congress finally repealed the margarine tax in 1950, and Wisconsin became the last state to repeal its anti-margarine regulations in 1967.

For more on the dairy industry in the 1880s, see the cartoon of March 31, 1883.