Politics & Policy

Ending the Sweetheart Sugar Deal


Government can’t solve every problem. But we should all agree that government at least ought to solve the problems it created.

Our federal sugar subsidies are a prime example; They are a symbol of government-created problems that require a government solution.

The federal government is taking part of every taxpayer’s income and using it to enrich a select oligarchy of 18,000 big farmers. Americans around the country are working hard to fatten the wallets of a tiny group of one-percenters. That ought to offend people on both sides of the aisle.

This 1930’s-era program is a Rube Goldberg machine that intentionally drives up costs for American companies and consumers. As a result, the price of sugar in the United States is nearly double the price on the world market.

Here is how it works. The federal government — not the market — sets  the maximum output of every sugar producer every year. The government also sets limits on how much sugar we can import, heavily taxing any in excess. As if this price-fixing were not enough, the government buys surplus sugar and then sells it at a loss to ethanol plants.

The federal government — not the market — sets the maximum output of every sugar producer every year.

Sugar is grown only in a few states, but we all use it every day, and we all pay the price. When you make something expensive, you get less of it. Other countries, such as Canada, openly advertise their competitive advantage over the United States in lower business costs for sugar-using industries, motivating companies to take jobs away from Americans and hire workers elsewhere. For every job that our sugar program “protects,” it kills three.

In addition to costing the taxpayer an average of $11.5 million a year, the average American family pays another $40 on groceries every year simply because the government is using that family’s tax dollars as a handout to big business. American families are paying for this handout with their tax bill and with their grocery bill.

#share#The 18,000 big farmers have been aggressively courting the support of politicians to maintain the status quo. As a result of sugar farmers’ massive campaign donations, sugar was the only commodity program not to be reformed in the most recent farm bill.

These powerful, entrenched interests have also sold a protectionist big-government alibi to those who are otherwise conservative. The alibi is that we should stop subsidizing these sugar growers only when the rest of the world stops doing so.

RELATED: Marco Rubio’s Billion-Dollar Sugar Addiction

By this argument, we should continue acting on every terrible idea, so long as at least one other country is also committing the same mistake — it would be perfectly okay, for instance, to nationalize our beer and gas industries because Taiwan has a state-owned beer company and Putin controls Russia’s gas industry. Other countries take all sorts of foolish actions that we should never take. According to these politicians and lobbyists, you should jump off a cliff just because everyone else is doing it.

The subsidies provide no net benefit to economic growth or to the economy as a whole, only to a tiny, wealthy elite.

This “zero for zero” argument — we’ll have zero subsidies here in the U.S. only when there are zero subsidies elsewhere — is based on the false premise that American sugar subsidies actually are good for our economy. It wouldn’t make sense to unilaterally disarm, they claim. But the subsidies provide no net benefit to economic growth or to the economy as a whole, only to a tiny, wealthy elite. On the contrary, they hurt our economy by sending jobs overseas and taking money out of our pockets.

But there is hope in sight. We have been working on a bipartisan basis to put an end to this blatant symbol of crony capitalism at its worst. Leaders from every part of the country and from every background recognize that the time has come to end these handouts to the super rich. Members of Congress from Virginia, New Hampshire, Oregon, and even sugar-producing Texas stand united against this big-government cronyism.

RELATED: Rubio: Our National Security Depends on Sugar Subsidies

There is no good reason for anyone claiming to be a conservative to support this New Deal sugar-subsidy program. But if you believe in earmarks, if you believe in pork-barrel spending, then it would not be surprising if you supported the redistribution of money to the wealthy.

Congress must set funding levels for the remainder of the current fiscal year. This must-pass legislation is an opportunity to reform our sugar policy and save money for taxpayers and the government. With a growing consensus inside and outside Congress, this may be the moment when we finally put an end to this expensive, insider sweetheart deal.

— Joe Pitts represents the 16th congressional district in Pennsylvania. Grover Norquist is president of Americans for Tax Reform.

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