Candy has become a darling of Wall Street because of its ability to profit at the expense of farmers and customers, and it has proven itself to be recession proof. In fact, during the worst economic downturn in modern history, confectioners boasted bigger net profit margins than even the largest oil companies, says Yahoo! Finance.
In the case of Mars, times appear to be particularly sweet. Since 2008, the company’s revenue is up 20 percent and 5,600 employees have been added to the payroll. That’s according to Forbes, which lists the $33 billion-in-revenue corporation as the country’s third biggest private company.
The Mars family has also added $15 billion in net worth since 2008, Forbes found.
So for all of good times, why has Mars turned to poormouthing on Capitol Hill? That’s where the political posturing comes into play.
Mars and others in the "Big Candy" lobby are hell-bent on boosting profits further at others’ expense, even if it means the elimination of the U.S. sugar industry in favor of highly subsidized imports.
These companies have cranked up the lobbying pressure on Congress to secure a change to a no-cost 2008 law overseeing the nation’s sugar industry. In Mars’ case, they spent more than $2 million to buy influence last year.
They want the law to be rewritten to secure government guaranteed sugar surpluses and low prices – a move that would outsource thousands of American jobs and decimate regional economies and communities that are built around what’s left of our country’s sugar production.
The end result isn’t just hypothetical either. Europe rewrote its sugar laws in 2006 and became more dependent on imports. Since then, 120,000 EU jobs have been lost and grocery shoppers are spending much more on sweetened-products.
While prices have soared and supplies dried up in Europe, America has enjoyed ample stocks. And sugar prices in America, which are currently 30 percent lower than in Europe, certainly haven’t cut into Mars’ financial success.
For example, a bag of M&M’s cost 90 cents when the current sugar policy became law. The price Mars paid for sugar in 2008 was 32.5 cents per pound. Today, sugar prices have fallen to around 30 cents per pound, while the bag of M&M’s has risen to $1.39. That bag of candy now only has about three pennies worth of sugar in it, which means the farmers’ share of the food dollar is falling.
In fact, the raw sugar prices that U.S. farmers receive today are at the same level as they were when Jimmy Carter sat in the Oval Office, and are nearly identical to the prices offered by the globe’s most subsidized competitors, like Brazil and Mexico.
Lawmakers should be cautious when hearing "Big Candy’s" spin. U.S. sugar prices are not high and confectioners aren’t embroiled in financial distress.
In short, losing U.S. jobs and weakening our food security is a pretty steep price to pay so that a chocolate giant can pocket a little more coin.
Johnson is the 14th president of the National Farmers Union. Prior to his post at NFU, Johnson held the position of Agriculture Commissioner in North Dakota for 12 years. His family farms in Turtle Lake, N.D.