What a Sweet Deal — Not for the Consumers

By November 21, 2007Trade

From The Hill, a story about Senator Norm Coleman (R-MN) and contributions to his re-election campaign.

With 2,600 jobs in beet fields and sugar refining factories, the sugar beet trade has much to gain from the farm bill. For example, the loan rate for the commodity would be increased by one cent over time in the Senate version of the bill.

In addition, sugar produced in the United States would be guaranteed 85 percent of the domestic market under the House and Senate bills, according to Nick Sinner, executive director of the Red River Valley Sugar Beets Grower Association, which represents the industry along the Minnesota-North Dakota border.

This is a key provision for the U.S. sugar industry, since without the protection increased imports of Mexican and Central American sugar would be allowed under U.S. trade agreements.

So you can by statute abrogate trade agreements negotiated with other countries?

Protection — in effect, a subsidy created by limiting supply — benefits a very small group and the expense of the greater public. In fiscal 2006, U.S. raw sugar cost 22.62 cents per pound, compared with an average world price of 15.78 cents per pound. (From CQ.)

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