Wednesday, May 25, 2005

Sugar Socialism v. Free Trade

Following up on what I discussed here about the sugar lobby and CAFTA, read Pete DuPont's criticism of the sugar subsidies we taxpayers are maintaining. Here's the key:

The American sugar industry is so strongly advantaged by quotas, tariffs and subsidies that total sugar imports have declined by about a third since the 1990s. Cafta would allow additional sugar imports from the Central American nations totaling 107,000 metric tons in the first year. Annual U.S. sugar production is about 7.8 million metric tons, so the effect of Cafta is to raise sugar imports into America by about one day's sugar production, or as Mr. Portman puts it, "approximately one teaspoon of sugar per week per adult American."

That threat--a teaspoon of sugar a week--has caused the U.S. sugar lobby to focus its efforts on killing Cafta. And it may succeed. The U.S. government agreed not to free up the sugar market in the 2004 trade pact with Australia.

* * *
American sugar imports would depress sugar prices, they say. Well, American sugar prices today are about three times the world market's, so some price reduction would be good for Americans, just as lower gasoline prices would be.

U.S. Sugar Corp.'s Senior Vice President Robert Coker believes that "bilateral and regional trade agreements are death by a thousand cuts." Such economic protectionism--no bilateral trade agreements allowed--is the good old-fashioned socialism that has failed millions of people for hundreds of years. Like Lenin, U.S. Sugar seems to think that Americans should suffer economically rather than have a free market in sugar.

No comments: