Q&A: The US Sugar Program
Americans pay billions to help sugar growers buy politicians. We should stop.
The US sugar program is a sprawling, complex federal handout that too few people know about. As a result, it quietly skates by, largely unquestioned, leaving a trail of destruction and tax bills. The following Q&A is just the first step toward understanding and eventually stopping the damage this massive government subsidy enables.
Sugar Program Q&A
Q: Is the sugar program actually a subsidy?
A: Absolutely. Although not a direct payment to growers, the program sets artificially high prices, guarantees buyers, guarantees profit, and blocks competition. Growing sugar is a zero-risk business thanks to US taxpayers.
Q: What does the sugar program cost?
A: A recent study found Americans paid a “hidden tax” of $1.4 billion added to the sugar they bought. Florida’s sugar industry–mainly US Sugar and Florida Crystals–pockets roughly 20% of that premium.
Q: What do taxpayers get in return?
A: There are no benefits to taxpayers. Businesses that buy sugar have cut American jobs in order to get their supply from other countries. Sugar itself has eliminated jobs, polluted our waterways, and endangered South Florida’s water supply. (Marco Rubio once claimed that the sugar program was a national security issue. It isn’t.)
Q: How do sugar growers keep these subsidies?
A: Money. Conservationist litigator David Guest once said Florida’s sugar industry is not in the sugar growing business, they are in the subsidy business. No other farm industry spends as much on lobbying or political donations. In fact sugar out-contributes all other U.S. crops combined to keep their supporters in office, voting for their subsidies (see chart above.)
Q: Is it legal to use government handouts for political donations?
A: If you choose who makes the laws, you can make almost anything legal. This is how subsidies turn businesses into rackets. Buying elections (with taxpayer money) continually increases sugar’s wealth by multiplying subsidies that politicians support. The political power that protects the sugar program also passes laws to make taxpayers pick up additional costs–essentially more subsidies–like the costs of sugar’s pollution cleanup, the costs of drainage and irrigation and all the infrastructure to manage it, and the costs of any infrastructure needed to develop their land. And the more value sugar squeezes out of lawmakers’ decisions, the more money they can contribute to keep those lawmakers in office.
Q: Is there real political opposition to the sugar racket?
A: Republican free-market advocates like the Heritage Foundation rail against subsidies like these, because they lead to the kinds of corrupt, bloated industries that kleptocracies like Russia prop up. (In Florida, phony free-market groups and politicians like Rubio and Rick Scott stay conspicuously silent about the sugar program.) Progressive democrats campaign against the kinds of human health, economic, and environmental abuses that sugar brings; but again, few Florida democrats speak up against sugar when their campaigns are financed by it.
Q: Is there a realistic, achievable solution to get sugar out of politics?
A: Stopping the flow of free money is the key. The sugar program is a quiet, shadowy piece of legislation. Changing it means getting voters to talk about it openly and question where the money goes. If taking money from sugar becomes politically toxic and voting to use public funds to enrich the industry automatically costs politicians an election, the cycle breaks.
Bullsugar.org is creating a feature-length overview of the sugar program, which will be available soon at Bullsugar.org. Until then here are two excellent recent articles for more background:
- Financial Times: Wilbur Ross, Sugar Barons Clash Over Mexican Trade Deal: After being a houseguest of Florida Crystal’s Pepe Fanjul, Commerce Secretary Wilbur Ross discovered his authority to negotiate trade deals was drastically limited
- Inside Sources: Big Sugar’s Assault on the Everglades: With a taxpayer-funded war chest and unmatched political influence, Florida’s sugar growers continue to wage a successful war against clean water legislation