Monday, January 24, 2011

"Big Sugar" Cartel Cost Consumers $4.5B Last Year

In a recent Wall Street Journal letter titled “The Sugar Program Makes Sense,” the American Sugar Alliance’s chief economist claimed that “sugar policy operates at no cost to the government and is projected to do so for the next decade.” While it’s true that U.S. sugar producers haven’t tapped American taxpayers directly since the beet sugar farmers raked in more than $240 million in farm subsidy payments from 2000 to 2005, U.S. sugar policy did force American consumers to pay out $4.5 billion last year in higher sugar prices to support the “Big Sugar” cartel.

Read more here of my Enterprise Blog post today "Sugar Policy: Sweet Deal for Producers, Sour Deal for Consumers."


8 Comments:

At 1/24/2011 2:09 PM, Blogger Benjamin said...

The arguments for free trade while holding on to atavistic nationalistic tendencies are empty--if the USA, for example, bars imported sugar, and no one can tell us different, then we have to buy US grown sugar. The WTO can't enforce free trade by waving pieces of paper.

The US trade barriers prop up the sugar industry, and the profits, jobs, traditions and byways of the 200-year-old industry. Free trade would crush the sugar industry and everyone in it, but lead to higher relative incomes for Americans, as we got our cheaper sugar.

Of course, the logical extension of free trade arguments is that we have a world authority to mandate free trade, and open borders for goods, services, labor and capital, and one global currency--in other words, like the United States, except The United States of the World.


This would in fact lead to higher global living standards, if free trade arguments are true.

I join Dr Perry in calling for open borders for labor, goods, services and capital.

 
At 1/24/2011 2:25 PM, Blogger Junkyard_hawg1985 said...

“sugar policy operates at no cost to the government and is projected to do so for the next decade.”

Unless you include costs such as unemployment for those who previously worked in industries using sugar (i.e. Candy-making). Or the loss of revenue from those industries and employees paying taxes. Or the higher costs associated with higher food prices requiring more food stamp expenditures, or higher lunch program spending. Or.......

 
At 1/24/2011 3:22 PM, Blogger morganovich said...

benji-

go read my response on optimal currency areas fro the last free trade piece. your global currency idea is irretrievably flawed.

further, surrendering national sovereignty to the WTO is naive to the point of irresponsibility.

who will run the WTO? what will their political agenda be? who will pay them or promise them plum jobs later for looking the other way on trade and non tariff barriers?

the track record of multi-national organizations on being bought and sold by the participants is dire. a quick look at the UN security council should give you a pretty good idea of what to expect.

better to just drop all US barriers to trade unilaterally. we come out way ahead in such a scenario. all tariffs are negative sum. then, just let the rest of the world figure it out as they do.

we'd be better off if they all dropped tariffs too, but that's no reason to, in the face of a foreign tariff, make ourselves even worse off by imposing our own in retaliation. to punish them by punishing your own consumers is just stupid.

 
At 1/24/2011 3:24 PM, Blogger morganovich said...

jh-

yes, but think of all the extra jobs we create treating the obesity and diabetes that is accelerated by using high fructose corn syrup with it's incredibly high glycemic index as opposed to healthier sugar...

:-P

 
At 1/24/2011 4:02 PM, Blogger juandos said...

Whoa now!

Let's not be to rough on 'big sugar', after all it was in part responsible for building the original bridge to nowhere...:-)

 
At 1/25/2011 12:40 PM, OpenID mikbarhm said...

Consider High Fructose Corn Syrup (HFCS) as well and where it prices vs. the sugar spreads. The sugar cartel is helping more than just big sugar--it's helping ADM.

 
At 1/25/2011 1:09 PM, Blogger VangelV said...

No wonder the US is in decline. Make consumers pay more than they should just so that some rich farmers in the South can get a better price for their sugar cane. How is this good for the economy again?

 
At 2/01/2011 5:34 PM, Blogger Whiskey Jim said...

Wouldn't it be great if all government policies had to record both benefits and costs of their 'care' for the people?

I wonder how many jobs left the country because sugar is too high.

 

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