Posted on 04/16/2005 6:36:04 AM PDT by Toddsterpatriot
I see the Cato Institute corporate shills are still misleading the public with myths about the "world sugar price".
Governments of all sugar-producing countries intervene in their production, consumption and/or trade of sugar, which makes sugar one of the most heavily subsidized and distorted markets in the world.
The so-called "world price" for sugar is essentially meaningless, reflecting a relatively small residual or "dump" market of highly subsidized sugar. Since 1985, this dump price has averaged only half the world average cost of producing sugar, and bears little, if any, relationship to actual global supply and demand conditions.
About 75 percent of the world's sugar production is not "traded" on the open market. Approximately 125 million metric tons of sugar are produced annually, and most of this–about 75 percent–is sold profitably in the country where it is grown and processed or it is sold at a profit under special arrangements to other countries. This allows the remaining 25 percent to be dumped below cost of production on what is commonly called the "world sugar market."
'World dump market' poses a serious threat to American consumers and producers. This so-called world market is a dumping ground for foreign sugar sellers. It is the most price-volatile of all commodity markets. In the recent past, prices have ranged from more than 60 cents a pound in 1974, and more than 40 cents a pound in 1980, to less than 3 cents a pound in 1985. Consumers are gouged as prices rise; farmers are hurt as prices plummet, threatening ,stable U.S. supplies. U.S. sugar policy works to keep supplies stable and prices reasonable.
It should be noted that elimination of subsidies will also eliminate surplus sugar production, and the so-called "word price" (the dumped surplus) will disappear. Just like OPEC oil, sugar prices would then increase dramaticly.
Mark
..."sugar policy works to keep supplies stable and prices reasonable". You might add that it also makes a certain group of farmers wealthy and keeps their political friends in power. If true, this policy would be the first example of a planned economy that worked. I had always thought that planned economies were the road to serfdom. (I made that up).
Don't forget Eastern Montana...
How many displaced American sugar workers would there be? 10 or 12? Saving those jobs is worth $2.5 billion a year? Is that the new math you're using?
There is no such thing as a true, laissez-faire free market economy.
The very existance of government influences economic decisions, and all government policies and activies impact the economy, one way or another.
Your use of the term "planned economy" is extremely naive and uninformed. U.S. crop subsidies, including sugar, in no-way resemble the "planned" command economies associated with marxist communism. Instead, they merely provide legitimate market incentives to assure that our nation benefits from a bountiful and stable food supply, rather than suffer from the natural cycle of "feast or famine" that is inherent in agriculture production.
You're funny!!
Well, don't you know that domestic sugar production is vital for national security? What if we went to war and Cuba and Brazil decided to cut off our sugar supply? We wouldn't last a week!!
And I suppose that while "dump sugar" (I just call it cheap sugar) was rising and falling that American sugar just stayed at 20 cents a pound? Wait, you mean that price also jumped around? I don't suppose you can show me a time when the "dump price" (lower price) was higher than the price for American sugar?
Fine by me. You're free to click on it all you want.
I'm still not going to be tolerant of false and disingenuous statements.
Subsistence-level wages are slavery? Who said that, Marx?
Sugar is very cheap.
You do not need to be Marx to see it. How many freetraders live on subsistence-level wage?
Either way, for people at the subsistence level, socialism might be a better choice.
It'd be $2.5 billion a year cheaper without the government restrictions.
How much sugar can you eat a day? $2.5 billion a year might be much lower than the cost of consequences. And I will not be surprised if the price of sugar goes up in the long term.
BTW, I have doubts about this $2.5 billion a year.
Wow, I can only use a finite amount of sugar, so I shouldn't care that government increases my cost by 150%? By that "logic", I shouldn't care if the government boosts oil to $125 a barrel.
And I will not be surprised if the price of sugar goes up in the long term.
Really? Sugar might go up so we should pay more now?
BTW, I have doubts about this $2.5 billion a year.
Well, with your "logic", I'm sure you have some info to back up your doubts.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.