Since 1934 the U.S. government has assisted the sugar industry, which has a powerful lobby. Until the late twentieth century, sugar growers had access to extremely lowpaid, non-unionized immigrant workers through a federal "guest worker" program for the industry.
In the early twenty-first century, the sugar industry was receiving $1.6 billion from the U.S. government. Rather than making direct payments to growers, as the Agriculture Department does in other industries, the department gives sugar processors short-term loans, and maintains high domestic prices by strictly limiting imports.
Critics of this policy note that sugar consumers pay two to three times the world market price.
In fiscal year 2000, domestic growers grew more than the government-set limit, and the government had to spend $465 million to buy their excess sugar and cover the cost of processors' loan forfeitures.
According to the Center for Responsive Politics, which tracks political campaign contributions, the sugar industry contributes more than one-third of the money that crop production and food processing interests spend on political campaigns. The industry has a growing U.S. market; sugar consumption has practically doubled in the past century, from 86 pounds per U.S. citizen to nearly 160. However, the fortunes of the U.S. sugar industry may change in the wake of the North American Free Trade Agreement, as Mexican imports are likely to flood the U.S. market beginning in fiscal 2004.
Sugar growers, textile manufacturers and labor unions have teamed up with congressional Democrats, seeking to derail a proposed trade agreement with Central America. Failure to ratify that measure could undermine more ambitious efforts to enact broader free trade initiatives encompassing all of the Western Hemisphere and the entire world, experts warn.
Opponents of these free trade initiatives say their opposition stems mostly from wanting to ensure a level playing field or to protect worker rights.