Carney on the Growing Sugar Boondoggle

Tim Carney continues exposing the politically motivated pork that politicians dole out to buy support and campaign contributions. This week, in his DC Examiner column, he takes on the farm bill’s expansion of the sugar program.

The farm bill headed to the White House this week guarantees that 85 percent of all sugar sold in the U.S. will be grown domestically. That means the federal government will fiercely restrict imports from other nations, driving up the price we pay for sugar.

This continues the long-running restrictions on sugar imports, which make our sugar more expensive. In 2007, raw sugar cost $11.60 per pound in the rest of the world, but $20.99 per pound here. Of course this makes our food more expensive.

The farm bill also ramps up the special loans taxpayers give sugar growers. Sugar growers currently receive an 18-cent loan from the U.S. Department of Agriculture for each pound of raw cane sugar (and a higher rate for beet sugar) they grow. The collateral is the sugar, meaning that if a sugar company can’t sell its stuff for more than 18 cents, the government buys it. That rate would go up to 18.75 cents under the farm bill.

Finally (actually, there are other sugar subsidies in the farm bill, but too many to list), there is the seemingly Cunningham-inspired sugar-to-ethanol program: The USDA buys “excess sugar” and sells it to ethanol makers — and only ethanol makers.

For more on the sugar program, see the CEI Issue Analysis, “Is the U.S. Sugar Problem Solvable?”