Idaho Statesman
Column By: Peter R. Crabb, Professor of Finance & Economics,Northwest Nazarene University in Nampa

Summer is near, and soon we will all be thirsting for cold drinks to beat the heat. If you want to add a little more sugar to your iced tea, lemonade or other summer favorite, call the government: It looks as if there will be plenty of sugar to pass around.

As reported by The Wall Street Journal last month, the U.S. Department of Agriculture plans to buy 400,000 tons of sugar from domestic producers this year, including Idaho’s own Amalgamated Sugar Co. The USDA action is part of federal price supports and subsidies for the industry that date back to the early 1930s.

A big part of the USDA price-support program is a quota system limiting how much can be imported from other sugar-producing countries. …

The sugar support program may protect U.S. production, but not without a high cost. A 2011 study by researchers at Iowa State University estimates a $2.9 billion to $3.5 billion annual cost to consumers from the program.

The American Sugar Association claims the U.S. sugar industry supports jobs for 142,000 workers. Therefore, the cost to consumers looks to be around an extra $20,000 or more per job.

So enjoy summer and all the sweet drinks. We’re paying dearly for them.

Read the full column here.

The Patriot-News (Harrisburg, PA)
Letter to the Editor By: Ben McGlaughlin, CEO, Wolfgang Candy Company

The May 7 op-ed, “There’s middle ground in this political fight over sugar,” was riddled with inaccuracies that must be corrected.

First, America’s sugar policy impacts companies of all sizes, not just large ones ­and, in fact, has had a more severe impact on smaller companies. Second, far from being “no-cost,” U.S. sugar policy costs consumers and businesses up to $3.5 billion a year. Third, reform-minded business leaders agree that U.S. reform should not be modeled after EU reform, which left in place costly tariffs and quotas like those in current U.S. sugar policy. And, fourth, though the author would have you believe otherwise, the reforms proposed would not provide countries with any new significant access to the U.S. market, nor eliminate U.S. subsidies. It is completely false that America would be dependent on foreign sugar. …

It’s time to bring sensible reforms to the federal government’s sugar program so that it works for all Americans, not just a few.

Read the full letter to the editor here.

Des Moines Register
Op-Ed By: Mark Lucas, Iowa Director, Americans for Prosperity

Congress is gearing up for another fight over the farm bill this summer, after failing to come to an agreement on the issue this past summer. This time around, Washington would be wise to take a step back and consider real reforms to the farm bill, instead of simply extending the corporate welfare policies of the past.

A little-discussed but extremely important piece of legislation, the farm bill affects hardworking families and their stretched-thin budgets by making them pay more at the grocery store. Consider the sugar program, which began under the 1981 farm bill. It props up sugar prices through both a domestic commodity loan program and an import quota system.

As a direct result, households see higher prices for sugar and everything sugar goes into. According to the Government Accountability Office, this sugar program increases food prices by $2 billion every year. American households pay nearly twice the world price for sugar because these policies prop up their prices and protect them from foreign competition.

Read the full op-ed here.

CATO Institute
Blog Post By: Sallie James

The American Sugar Alliance, the main lobby group for American sugar growers, released a report last week alleging that the subsidies given to Brazilian sugar growers are depressing the world price of sugar perhaps by 25 to 30 percent. …

I mean, really. This is getting awfully tiresome. The sugar lobby for years have been complaining that we need the sugar program, which keeps prices high for producers by keeping imports strictly controlled, in order to enable “reliable” (i.e., managed) access to sugar. Now they think sugar is too available (i.e., cheap)? For sure, if I was a Brazilian taxpayer, I would baulk at the thought of subsidising (if that in fact is the situation) the sugar addictions of my richer neighbours to my north, but as a consumer? Muito obrigado! The sugar lobby’s talking points are getting ever more creative. But none of them are valid.

Read the full blog post here.

Candy Industry
Column By: Bernie Pacyniak

It is time for all candy makers to get off their duff and send “e-mails, voice mails and money” to Congress to get rid of our national sugar welfare program.  Pardon the Warren Zevon parody, but I believe this is the closest we’ve come to actually reforming our domestic sugar program since I’ve been editor of Candy Industry.

Recently, a bipartisan coalition of Senators and Congressmen — yes, your read that correctly — introduced the Sugar Reform Act of 2013 (Senate Bill 345), which aims at lowering sugar prices without the use of federal supply interventions.

Sen. Mark Kirk (R-IL) , who’s cosponsoring the bill together with a host of Senators — including Jeanne Shaheen (D-NH), Pat Toomey (R-PA), Dick Durbin (D-IL), Rob Portman (R-OH), Frank Lautenberg (D-NJ), Dianne Feinstein (D-CA), Bob Corker (R-TN), Kelly Ayotte (R-NH), Lamar Alexander (R-TN) and  John McCain (R-AZ) as well as Congressmen Joe Pitts (R-PA), Earl Blumenauer (D-OR) and Danny Davis (D-IL) —  maintains the Senate “candy desk” with candy stocked from Illinois companies.

Consequently, as one would expect, sugar reform is a subject near and dear to his heart.

Read the full column here.

Lancaster Intelligencer Journal
Editorial

Ongoing subsidies to sugar growers have propped up prices to food manufacturers — and, consequently, to consumers — and led companies to outsource an estimated 127,000 jobs in the past 15 years.

The subsidies have long been a point of congressional debate. Two Pennsylvania lawmakers — U.S. Sen. Pat Toomey and U.S. Rep Joe Pitts, both Republicans — are now sponsoring separate bills to reform the federal sugar program.

The pair have the support of the Coalition for Sugar Reform — an alliance of consumers, food and beverage manufacturers and advocacy groups — which seeks to fix this Depression-era policy.

Because the United States has never been able to produce enough sugar to meet domestic demand, the U.S. Department of Agriculture, since the 1930s, has imposed price supports which establish a minimum price for sugar produced by sugar cane growers in the South and in Hawaii, and sugar beet growers from Minnesota to California.

The federal government subsidy comes with strings attached: Sugar processors are forbidden from selling more sugar than the subsidy provides — even if the demand exists.

Read the full editorial here.

FoxNews.com
By: Doug McKelway

Joe Dutra has defied the trend of American confectioners and candy makers who’ve moved abroad to escape the U.S. government’s regime of sugar subsidies.

After moving his Kimmie Candy Company back to the United States from South Korea, he’s now operating a $4 million-$5 million business in Reno, Nev.

But, he said, “when coming back to the United States, I found out that I was paying up to 90 percent more for sugar in the last few years.”

Sugar is just one commodity whose price is hugely inflated in the United States because of what critics call an outdated system of subsidies and price supports. The subsidies take the form of direct payments to farmers that cost taxpayers billions — as well as restrictions on imports and how much can be grown, and other regulations that raise prices.

“It’s ridiculous,” said Sen. Tom Coburn, R-Okla., a frequent critic of subsidies. “We’re losing candy manufacturers in America because the price of sugar is four to six times higher here than it is anywhere else in the world.”

Read the full article and watch the video here.

Washington Post
Editorial

Of all the many ways in which federal policy distorts agricultural markets, none is more convoluted than the protectionist scheme for sugar. The government sets aside a maximum of 85 percent of the market for U.S. producers; the rest gets divvied up among exporting countries eligible to ship their respective “quotas” to the United States at a preferential tariff rate. (It’s legal to sell to the United States beyond the quotas, but extra-high tariffs usually make it uneconomical.) Then there’s Mexico, which since 2008 has been able to sell sugar to the United States without limit, under the North American Free Trade Agreement. Meanwhile, the Department of Agriculture guarantees minimum prices for both raw cane sugar and refined beet sugar.

The combined effect of these measures has been to inflate the U.S. price of sugar – for better or worse, one of the most ubiquitous food ingredients — making all sorts of products more expensive for consumers and diminishing employment in U.S. businesses that use sugar as an input.

But defenders of the sugar program at least have been able to assert that it does not cost federal taxpayers one dime – until now, that is.

Despite the government’s elaborate efforts to prop up the U.S. sugar price, it has dropped below the USDA’s target. There’s a glut on the market – in part because of the aforementioned Mexican imports.

Read the full editorial here.

NPR’s All Things Considered
By: Dan Bobkoff

While you indulge in some Easter Peeps and chocolates this weekend, you might want to think about all that sugar. No, this isn’t a calorie warning. In the U.S., raw sugar can cost twice the world average.

Critics say U.S. sugar policy artificially inflates sugar prices to benefit an exclusive group of processors — even though it leads to higher food prices. But this year, prices fell anyway. Now, the government could be poised to use taxpayer dollars to buy up the excess sugar.

American sugar starts where you’d expect: in a field, like Gary Gravois’ sugarcane crop in Napoleonville, La.

“It’s just something in the culture of South Louisiana,” Gravois says. “If you’re a farmer, that’s pretty much what you do.”

And in the end, that sugar might end up in a jelly bean. Bob Simpson, president of Jelly Belly in California, says it’s 40 percent of the product and the “most expensive ingredient.”

Read the full article here.

Bryan Times
Op-ed By: Representative Bob Latta (R-OH)

Just like the batches of candy at Spangler Candy Company, America’s sugar policies have been mixed, blended, and twisted for over 75 years. Originating back to 1934, the Sugar Act was created to stabilize sugar prices and protect sugar farmers during the Depression. This program, initially set to expire in 1940, includes outdated sugar policies that artificially inflate prices, limit domestic production, and impose strict import quotas. Under current policy the federal government drives costs up by limiting how much sugar is permitted to be sold in the U.S. each year. Additionally, the federal government restricts the amount of sugar that can be imported annually to the U.S. from foreign producers. Due to government controls, food and beverage producers are unable to take advantage of the lower world-market prices, and should a company need to import more sugar they are faced with a high tariff. The high costs of sugar are instead passed onto businesses and consumers who buy sugar or products that contain sugar, costing an additional $3.5 billion a year.

Read the full op-ed here.