Sugar industry politics, 2017 style
If you search this site for “Sugar Policy,” you will get lots of items over the years.
Now, several members of Congress have introduced a bill, the Sugar Policy Modernization Act, to remove price supports and repeal marketing allotments and quotas.
These keep the price of sugar produced in the U.S. artificially high, but not so high that the public complains.
Industrial users of sugar—candy and soda makers, for example—want to buy sugar at cheaper worldwide market rates.
Good luck with trying to do this. Big Sugar is happy with the current system and lobbies with great effect to make sure it stays that way.
Representatives from the House Sugar Caucus (yes, there is one) sent a letter to fellow members of Congress urging them to vote against this proposal.
The Sugar Program Modernization Act would upend this success and reward the world’s worst subsidizers at the expense of U.S. sugar farmers. While a handful of food manufacturers would benefit under the Sugar Program Modernization Act, farmers, sugar workers, rural communities, and consumers would lose out. That is too steep a price to pay so multinational food conglomerates can pad their profits.
But politics makes strange bedfellows. The American Enterprise Institute has a new analysis of sugar policies. Its key points?
- The US sugar program is a protectionist scheme destined to transfer income to sugar growers and processors at the cost of sugar users and consumers.
- The losses to consumers and users are large in aggregate for the country, in the order of $2.4–$4 billion.
- The major recommendation is the total removal of the sugar program’s main components, including tariff-rate quotas, allotments, and sugar loan rates.
It’s hard to know how this will play out this year. History favors a win for Big Sugar. They run politics in Louisiana and Florida, But this too will be interesting to watch.