Posted on 07/16/2007 8:52:38 AM PDT by Toddsterpatriot
“It’s an outrage!” That’s the usual cry of Washington politicians when they chastise the world outside their chambers for their profligate ways, which they then promise to “fix” by passing more laws. Now is the time for consumers and taxpayers to shout back at their legislators — and they should focus on proposals for the new 2007 farm bill, especially the bloated sugar program.
The House Agriculture Committee is scheduled to debate the new farm bill starting on July 17, with the full House expected to consider farm legislation later this month. Agriculture Committee Chairman Collin C. Peterson (D., Minn.) is proposing to include a new sugar system to further sweeten the pot for the large agribusinesses that already benefit from one of the most outrageous government programs on the books.
The current U.S. sugar program is a complex system composed of three main parts — all designed to reward sugar producers at the expense of consumers and taxpayers. The program restricts the domestic supply of sugar, guarantees sugar producers a minimum price, and keeps out many imports. The cost of this price support and tariff regime includes higher food prices for U.S. consumers, lost jobs in sugar-using industries, a waste of taxpayer dollars, environmental damage to ecologically sensitive areas, and the loss of economic opportunities for many small farmers in poor countries.
Under the current program, Americans have been paying for sugar at two to three times the world price over the past 25 years. The Government Accountability Office (GAO) estimates that the program has cost consumers $1.8 billion per year. A later OECD report corroborated this huge consumer cost but put the figure slightly lower, at about $1.4 billion.
But that doesn’t seem to be enough to satisfy the small-in-number but huge-in-influence sugar producers. They want higher price supports and better guarantees that more foreign sugar will not be allowed into this country. In the new proposals, the sugar price support would be increased from 18 cents to 18.5 cents per pound for raw cane sugar, and from 22.9 cents to 23.5 cents per pound for refined beet sugar. A study by the consultancy Promar International estimates that this increase would cost American consumers an additional $200 million per year.
Because of the high cost of sugar, jobs are lost in industries that use sugar in large quantities. Last year a Commerce Department study found that restricting sugar imports led to a loss of 10,000 jobs in candy manufacturing and noted that for every one job saved in the sugar industry, three jobs were lost in the confectionery industry.
The higher price supports in the proposed legislation, in addition to leading to higher costs for consumers and taxpayers, would also encourage even more domestic sugar production, which will mean further encroachments by sugar producers into ecologically sensitive areas, such as Florida’s Everglades.
The current program constrains sugar imports under a tariff rate quota (TRQ) system that allows specific amounts of sugar from certain countries to be imported duty-free, with high tariffs applied to sugar above those quotas. However, the proposed legislation could further restrict sugar imports by mandating how much sugar can be imported during specified periods. That mandate would take away the USDA’s discretion to allow TRQ imports as they are needed and further disrupt the supply.
The proposals also add a new component to the sugar program: the use of surplus sugar to produce ethanol, even when government reports show that U.S. sugar is a costly ethanol feedstock. This mandate — besides costing taxpayers — would also cause producers to shift from food to fuel use of sugar, which would further harm consumers by restricting the supply of food sugar and artificially boosting demand for sugar overall, leading to even higher prices.
And who benefits from this largesse? A small number of large sugar-cane and sugar-beet producers. A GAO study in the early 1990s showed that only one percent of sugar cane and sugar beet farms received 42 percent of the program’s benefits. The benefits are especially concentrated for sugar-beet producers: Just four firms accounted for 87 percent of production in 1990.
Fortunately, in both the House and the Senate, some legislators do recognize that the needs of consumers and taxpayers should trump the appetites of rich sugar producers. In May 2007, Senator Richard Lugar introduced a bill — called FARM-21 — that would, among other provisions, end the sugar-loan program and lift barriers to sugar imports. A similar version of the bill was introduced in the House by a bipartisan group of U.S. congressmen: Representatives Ron Kind, Jeff Flake, Joseph Crowley, and Dave Riechert.
The U.S. sugar program is one of the most egregiously harmful government programs to consumers and taxpayers. With consumers today facing higher prices for food and taxpayers facing a huge budget deficit, policymakers should take strong steps to repeal the U.S. sugar program instead of handing out more candy to Big Sugar.
— Frances Smith is an adjunct fellow, trade and consumers, at the Competitive Enterprise Institute, and is the former executive director, Consumer Alert.
I am curious to see if the president and those representatives who believe we must have unlimited foreign labor will support unlimited sugar imports. After all, it will only be used to sweeten those products Americans won’t sweeten!!!
I believe Red Bull is not made with HFCS.
Their push for higher imported sugar tariffs and higher floor prices right now is due almost entirely to the (government-ordered, via ethanol) price increase in corn. HFCS isn't competitive @ $4.00 corn with the sugar tariff where it is now (although, to be fair, corn is limit down today, and I don't fancy corn staying at $4.00 continuously for any great period of time, absent a really bad crop some year).
Thus, increasing the already artificially high sugar price in the US is tailor-made for ADM's purposes.
See post #23.
One of the big shots Clinton was on the phone with that Monica remembered?
A member of the Fanjul family, they make millions per year from Florida sugar.
That stuff will make you fat as a cow.
I don’t buy products with HFCS. I also try not to buy anything with added sugar. It’s in the goofiest things like salsa, salad dressings, etc., where it is absolutely unnecessary.
“Lard with sugar makes great sandwiches!”
Aren’t those called oreos?
I love the double stuff.
Aren’t these “poor” farmers making a killing over the price of corn and the ridiculous mania over Ethanol? Why should we feel sorry for them?
You are exactly right ADM & Cargill would never let this happen.
That net worth is based primarily on their land.
Gee, I thought annexing Hawaii in 1898 was going to keep the cost of sugar down! (/sarc)
So we should have super expensive sugar because why?
In Chicago i can tell you of all the small candy companys
including Brach’s which had to close.
Makes no sense. Higher prices=loss of jobs.
No. The price of seed, fuel, fertilizer, storage and transport are also way up. The farmer is the last person that is 'making a killing', as is almost always the case.
At least 43 percent of ADM's annual profits are from products heavily subsidized or protected by the American government. Moreover, every $1 of profits earned by ADM's corn sweetener operation costs consumers $10, and every $1 of profits earned by its ethanol operation costs taxpayers $30.
Archer Daniels Midland A Case Study In Corporate Welfare
http://www.cato.org/pubs/pas/pa-241.html
Perverse subsidies
http://www.brocku.ca/envi/db/envi1p90/readings/Perverse%20Subsidies%20Executive%20Summary.pdf
Today, these dubious goods deliver more than half of ADM's operating profit, combining for about $290 million in operating profit in the third quarter of 2006 alone. And the political edifice that protects ADM's corn-based empire looks intact.
House Speaker Nancy Pelosi (D-Calif.) spent time during the fall campaign stumping around Minnesota pledging her allegiance to corn ethanol as the fuel of the future. The purpose of her trip was to reassure the constituents of Rep. Collin Peterson (D-Minn.) that voting Democratic wouldn't mean an end to ethanol subsidies. Peterson, a virulent ethanol booster, is now set to take over the House Agriculture Committee, which will wield tremendous influence over the 2007 Farm Bill.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/08/06/MNGQJKC8081.DTL&feed=rss.news
Nor will ADM encounter much friction in the Senate, where Sen. Tom Harkin (D-Iowa) looks set to regain the chairmanship of that body's agriculture committee. Harkin's enthusiasm for corn-based ethanol is nearly boundless. This is the man who, facing down critics who dared question ethanol's environmental value, once took a swig of the corn-based fuel on the Senate floor, evidently to demonstrate its salubrious qualities.
All these subsidies and trade restrictions aren't helping the farmers? Then the farmers wouldn't mind if we ended these welfare programs.
Here’s a couple links - but do your own research. (If you drew a chart showing the climb of the use of HFCS in the past 2-3 decades and a chart of the increase in obesity, diabetes etc = they would be pretty identical..
If you eat more calories and exercise less, it doesn't matter what you eat. You'll still get fat.
--but you don't and nobody else does. What really happens is that everyone's buying cheaper foreign candy; like the article said, "restricting sugar imports led to a loss of 10,000 jobs in candy manufacturing and noted that for every one job saved in the sugar industry, three jobs were lost in the confectionery industry".
Import taxes are welfare for the lazy rich.
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