A special interest’s sweet deal

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This Valentine’s Day, when you buy your sweetheart that classic box of American chocolates or any other kind of sweet, you will also be paying a hidden tax that’s baked into every food, snack and treat.

This tax is courtesy of the U.S. sugar program, and it forces American consumers and small businesses to pay $2.4 – $4 billion to subsidize a handful of wealthy sugar processors every year according to the American Enterprise Institute (AEI). The U.S. sugar program is the only commodity subsidy program that has not been modernized in 80 years.

{mosads}It’s time for this Congress to change that.

The program is a complicated bureaucratic mess of price supports, market allocations, quotas and government guarantees that are ultimately covered by taxpayer dollars. At the same time, the program drives up consumer prices by restricting needed sugar imports even as it restricts domestic production at home, leaving the U.S. market with constant shortfalls.

Unlike other farm programs, by design, the sugar program imposes its costs on American consumers and small businesses as a hidden tax on all products that include sugar – and when we say it subsidizes a handful of wealthy sugar processors, we are talking about a group of 13 mega-processors. That’s right. The sugar program operates at the expense of all Americans just to benefit a group of 13 special-interest entities.

These processors, using profits guaranteed and boosted by the program, continue to mislead lawmakers into believing it operates at zero cost to taxpayers. But, coupled with the AEI data, we only have to look back a few years to prove this false. Between 2013 and 2014, $259 million in U.S. taxpayer dollars were used to bail out the processors and ensure their income. This was just after the 2014 Farm Bill was inked. In addition, the Congressional Budget Office forecasts that the sugar program will continue to cost taxpayers over the next decade.

Our colleagues in Congress should understand that in addition to imposing additional costs on taxpayers, businesses and consumers, the program threatens the most highly coveted commodity amongst American workers: manufacturing jobs. Our own government, the International Trade Commission, has previously attested to the fact that the sugar program kills three manufacturing jobs for every job that it sustains. In real terms, the program killed 123,000 jobs between 1997 and 2015. Despite this, the latest ploy by the sugar lobby is that we should simply wait to reform the program until every country in the world eliminates their domestic subsidies through a so-called “zero-for-zero” approach. Try telling that to America’s workers.

Instead of outsourcing our Article I authorities to foreign governments, we are focused on a pragmatic and achievable policy. We’re working with our colleagues in our chamber and in the Senate – Republicans and Democrats – to stand up for American families and manufacturers through commonsense legislation to modernize the sugar program. The Sugar Policy Modernization Act is the bill we’ve authored, and the reforms it proposes are modest in scope. The bill does not abolish the sugar program nor hurt farmers, contrary to the claims of the self-interested processors who profit by the millions and billions from the program each year. Why would they want to change a system that has for decades been rigged for their benefit?

However, a growing number of lawmakers in the House and Senate do want to see change and modernization to reduce the financial burden of the system for consumers.

Across the country, 600,000 Americans work for thousands of companies that use sugar as a key ingredient in the products they make. In our home states alone, there are more than 35,000 Illinois jobs and 13,000 North Carolina jobs that depend on these companies and their ability to compete. The companies range from large American manufacturing operations to multigenerational small businesses in cities and towns from coast to coast.

As Congress begins gearing up for the 2018 Farm Bill debate, we should commit to modernizing the sugar program to ensure it takes into account the economic interests of 300 million American consumers and the small businesses that are the backbone of our economy, not just the wealthy and connected in Washington. It’s time for government to stop playing favorites with this “can’t lose deal” for a handful of special interests and instead, do what is right for the majority of the American people.

Foxx is chairwoman of the Education and The Workforce Committee and Davis is a member of the Ways and Means Committee.


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