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Be Mine: Sugar Industry Should Welcome Free Trade

Posted By Ashlee Smith On February 14, 2013 @ 10:00 am In Economics | Comments Disabled

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Photo credit: CJ GUNTHER/EPA/Newscom

Valentine’s Day is synonymous with roses, chocolate, and those wonderfully sweet heart-shaped sugar candies [2].

What isn’t so sweet about the holiday of love is the “love” that the U.S. sugar program sends to consumers in the form of higher prices and fewer jobs.

The federal government has been propping up the sugar industry since World War I and sugar farmers are doing everything they can to ensure subsidies and protection policies remain intact.

The U.S sugar program, included in the farm bill, is a government program creating price supports [3] for American sugar growers. The program places limitations on the amount of sugar that can be imported. Once this limit is exceeded imported sugar faces exorbitant tariffs.

Federal limitations on sugar imports force U.S. consumers to pay more per pound [4] than the world sugar price.

It’s not only sugar prices that are affected. The sugar program leads to higher prices for many products that include sugar like cereal, soda, ketchup, fruit juice, and bread. One study conducted found that the unseen food taxes equate to $3.5 billion in added cost for consumers [5] per year.

The sugar program isn’t doing a good job of protecting anyone or anything except special-interest groups and inflated prices. The U.S Department of Commerce linked the sugar program to the loss of thousands of jobs [6] in sugar-related industries; noting that for each job the program saves three others are lost.

Import restrictions and price supports may be beneficial for big sugar growers, but at what cost? U.S consumers face higher prices for sugar compared to the rest of the world and fewer jobs due to protectionist policies.

While candy consumers will face higher prices purchasing sweets for their sweetheart on Valentine’s Day, those who buy flowers will see the sweet deals that come with free trade. American florists import a majority of their blossoms from Colombia; 450 million flowers [7] are expected to come from Colombia just for Valentine’s Day. The free trade agreement [8] in place between the U.S and Colombia means no additional import tax on Colombian flowers for consumers.

This Valentine’s Day, flowers, not candy, are the sweeter deal.

Ashlee Smith is currently a member of the Young Leaders Program at The Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm [9].


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2013/02/14/be-mine-sugar-industry-should-welcome-free-trade/

URLs in this post:

[1] Image: http://blog.heritage.org/wp-content/uploads/ConversationHearts_130213.jpg

[2] heart-shaped sugar candies: http://www.bhg.com/holidays/valentines-day/recipes/sweet-history-of-valentines-conversation-hearts/

[3] government program creating price supports: http://fcir.org/2012/09/09/in-sugar-price-supports-sour-tastes-for-consumers/

[4] pay more per pound: http://www.ers.usda.gov/topics/crops/sugar-sweeteners/background.aspx

[5] $3.5 billion in added cost for consumers: http://sugarreform.org/wp-content/uploads/2011/11/The-Impact-of-the-U.S.-Sugar-Program-Beghin-Elobeid-Report-11.17.11.pdf

[6] loss of thousands of jobs: http://trade.gov/media/publications/pdf/sugar06.pdf

[7] 450 million flowers: http://www.google.com/hostednews/afp/article/ALeqM5iwlh7h1uPgRvPIONSQhGaKNkLcTg?docId=CNG.4e201b9124c065f698a3b89b09e38576.aa1

[8] free trade agreement: http://www.heritage.org/research/factsheets/2011/10/free-trade-agreements-long-overdue

[9] http://www.heritage.org/about/departments/ylp.cfm: http://www.heritage.org/about/departments/ylp.cfm

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