You may not know this, but Brazilian sugar is a threat to U.S. national security. At least, that is the view of Senator Marco Rubio (R., Fla.).
Asked this month about his support for sugar subsidies, Rubio said he would eliminate them if “the countries that export sugar into the U.S. get rid of theirs as well, and here’s why: Otherwise, Brazil will wipe out our agriculture and it’s not just sugar.”
If we eliminate our sugar subsidies first, Rubio warned, “other countries will capture the market share, our agricultural capacity will be developed into real estate, you know, housing and so forth, and then we lose the capacity to produce our own food, at which point we’re at the mercy of a foreign country for food security.”
Let’s try to untangle this. If we get rid of sugar subsidies, Americans will turn their sugar farms into condominium lots and start buying sugar from foreigners, who will starve us until we surrender to ISIS. Or something like that.
The federal sugar program, which consists of price supports, import quotas, loan guarantees, and other anti-market contrivances, costs $1.9 billion annually, according to an estimate by the GAO. The Coalition for Sugar Reform, which advocates the repeal of sugar subsidies, says the program has cost $15 billion since 2008. American consumers must bear these costs for the privilege of buying sugar at more than twice the world rate. The benefits, meanwhile, accrue to the fewer than 4,500 domestic sugar producers.
In 1934, the U.S. government decided to subsidize sugar on a “temporary” basis. As often happens in Washington, at some point in the intervening decades, “temporary” came to mean “forever.” The result is a system in which the less-than-1 percent enrich themselves at the expense of the 99-plus percent, thanks to unremitting bipartisan support.
The justifications for sugar subsidies are limited, both in number and in cogency. Senator Al Franken (D., Minn.), whose state is home to sugar-beet farmers, said the sugar program is “critical to jobs and economic development.” In similar fashion, Rubio called the sugar industry “an important job creator in Florida.” It would be more accurate to say that the sugar program is critical to the sugar industry.
In this case, job creation has its downsides. For every sugar-related job created, three jobs in confectionery manufacturing are forfeited as a result of the high prices. “No regulation of commerce,” Adam Smith observed, “can increase the quantity of industry in any society. . . . It can only divert a part of it into a direction into which it might not otherwise have gone.”
We have as much reason to grow our own sugar as Lithuania does to make its own cars: none. The fact is that other countries produce certain things more cheaply and efficiently than we do. That is why we trade with them. If only our government would butt out, we could buy sugar even more cheaply.
We have as much reason to grow our own sugar as Lithuania does to make its own cars: none.
Trade embargoes invariably break down. Even though North Korea and the United States have no trade relations, Kim Jong Un’s brother managed to get himself a Chicago Bulls jersey. Fidel Castro, likewise, has been spotted wearing Adidas apparel. Not every trading partner of ours is precluded from trading with our enemies. Eventually, in a global economy, everybody trades with everybody. If for some reason Brazil decides not to sell sugar to us, we can buy it from countries that buy it from Brazil. Presto! It really is that simple.
Oftentimes, invoking “national security” to defend a particular subsidy is just a pretext for maintaining a racket. In 1954, the U.S. government established price supports for domestic wool and mohair production “as a measure of national security.” (Seriously.) Sixty-one years later, politicians from sugar-producing states insist that preserving sugar subsidies is tantamount to preserving our national independence. “Our food security and, therefore, our national security depends on it,” Rubio said in 2012, “it” being the U.S. sugar industry.
The national-security rationale proved compelling during the Cold War, particularly after Castro took power in Cuba and seized control of its sugar production. At the time, American sugar interests argued that expanding domestic quotas would prevent “more Castro-like revolutions in Latin America.” In response to concerns about the supposed unreliability of sugar imports during wartime, an official at the U.S. Department of Agriculture offered the following rebuttal: “In any limited war there would be no serious sea transport problems and if we have an unlimited war with thermonuclear bombs and warheads, a shortage of sugar will be the least of our worries.” Indeed.
The Cold War is over, but the excuses for sugar subsidies persist. If protecting Americans’ lives were the goal, Rubio would be calling for a ban on sugar, not a subsidy. After all, sugar kills more Americans than terrorists do. According to a recent study published in the journal Circulation, sugar-sweetened beverages account for one in every 100 obesity-related deaths. Each year an estimated 25,000 Americans die as a result of consuming them.
Obesity causes deaths. Sugar causes obesity. The government subsidizes sugar. You subsidize the government. You subsidize death. The terrorists win.
This syllogism makes at least as much sense as what Rubio said.