Justin Sykes

Grover Norquist Calls for End to Sugar Subsidies at Hill Briefing

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Posted by Justin Sykes on Thursday, November 19th, 2015, 11:22 AM PERMALINK

Americans for Tax Reform president Grover Norquist this week spoke at a Congressional Briefing on U.S. sugar reform hosted by Rep. Bill Shuster (R-Penn.), where Mr. Norquist and three other experts called for an end to policies under the U.S. Sugar Program that harm American taxpayers, consumers, and businesses.

Addressing a standing room only crowd at the Rayburn House Office Building, Mr. Norquist charged that the sugar program amounts to a system of corporate welfare that allows the sugar industry to “get rich on other people’s money,” branding the sugar reform fight as “the new Ex-Im.” 

Norquist also issued a warning to Congress that “those politicians who vote to maintain the status quo with the Sugar Program are opening themselves up to more scrutiny than they’ve had in the past.”

The briefing included opening remarks by Rep. Bill Shuster (R-Penn.) and Rep. Mike Kelly (R-Penn.), with Shuster stating, “this briefing lays the groundwork for a needed discussion on the issue, and I will continue working with my colleagues to make reforms to the program." 

Speaking on the domestic impacts, the panel noted that the program cost American taxpayers nearly $300 million in 2013 alone, and the Congressional Budget Office projects it could cost taxpayers an additional $115 million over the next 10 years. It was also pointed out that the program has contributed to the loss of nearly 10,000 jobs annually in the U.S. food industry, and that for every one sugar-growing job saved by high U.S. sugar prices, approximately three U.S. manufacturing jobs are lost.

While most of the panel’s focus was on the domestic impacts of the sugar program, the discussion also expanded to issues the program causes for American trade negotiations. “This disrupts all of our efforts to get free trade and damages every American exporter and consumer not just in this zone, but because in order to do this stupid thing to our consumers we have to give way on other stuff that also does damage to our consumers and our producers,” Norquist stated. 

Looking ahead the panel noted that opportunities for reforming the program could soon come in an appropriations bill or during the budget process. 

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Top Five Reasons to End U.S. Sugar Subsidies

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Posted by Justin Sykes on Monday, November 16th, 2015, 12:58 PM PERMALINK

The current U.S. Sugar Program was introduced in 1934 with the goal of lowering sugar production and raising sugar prices. Unfortunately for American consumers, businesses, and taxpayers, the sugar program has achieved its intended goal all too well. 

The result has been a system of protectionist policies that solely benefit the sugar industry at the expense of American consumers and taxpayers. Since 1934, the U.S. Sugar Program has evolved into a thicket of government imposed price supports, import quotas, and tariffs that keep domestic sugar prices artificially high.

These sweetheart deals for “Big Sugar” are costing taxpayers and consumers billions, while impacting the economy and fostering a climate of crony capitalism that rivals that of the Ex-Im Bank. The time has come for lawmakers to reexamine what is actually being accomplished by this corporate welfare scheme. Below are five reasons the sugar program is quite literally all cost and no benefit for Americans. 

1. The sugar program has cost taxpayers billions. For American taxpayers, the sugar program has led to billions of their hard earned dollars being wasted propping up the sugar industry. Estimates show that from 2000-2001 the sugar program cost taxpayers almost half a billion dollars. In 2013 nearly $300 million was charged to taxpayers by the program, and the Congressional Budget Office (CBO) projects the program will cost taxpayers an additional $115 million over the next 10 years. 

2. Consumers pay the price for sugar subsidies. As a result of the sugar program, the average wholesale price of domestically produced sugar in the U.S. is more than twice the average world price of sugar, an average of 14.87 cents higher per pound. For instance in August of 2015 the U.S. sugar price of 33.13 cents per pound was more than double that of the world price of 15.57 cents. This means that American consumers are not only footing the bill for these government backed handouts to big sugar, but are being made to pay higher prices for sugar and related goods as a result.  

3. Sugar subsidies are crony capitalism at its worst. Much like the beleaguered Ex-Im Bank, the U.S. sugar program is the antithesis of free-market policy. The program instead represents the worst of corporate welfare and cronyism that so often plagues D.C. politics. Through the use of price supports, import quotas and tariffs, the sugar program destroys competition in the market, protecting the politically connected sugar industry at the expense of hard working Americans. 

4. The sugar program is destroying thousands of U.S. jobs annually. Protectionist policies under the U.S. sugar program have led to artificially high prices for domestic sugar, creating incentives for manufacturers to import certain sugar products or to relocate their operations outside of the U.S. As a result, the sugar program has led to a loss of nearly 10,000 jobs annually in the U.S. food industry. The Department of Commerce (DOC) estimates that for every sugar-growing job saved through high U.S. sugar prices, approximately three manufacturing jobs are lost. 

5. Sugar handouts distort the market and harm domestic businesses. The current U.S. sugar program uses protectionist policies to prop up the sugar producing industry, insulating producers from market forces and most importantly competition. While artificially high prices and restricted competition is good for sugar producers, domestic sugar-using manufacturers alternatively are competing globally but paying for domestic sugar at a rate twice that of the global price, putting them at a severe disadvantage.  

Photo credit: Moyan Brenn

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Cruz Calls for End to Sugar Subsidies in Presidential Debate

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Posted by Justin Sykes on Wednesday, November 11th, 2015, 2:54 PM PERMALINK

Despite all the discussion of corporate welfare and cronyism in recent GOP presidential debates, one of the most dramatic examples of corporate welfare, U.S. Sugar Subsidies, has gone unmentioned. That is until last night’s debate in Milwaukee when Republican presidential candidate Senator Ted Cruz valiantly called for an end to the taxpayer funded “corporate welfare” that is the U.S. Sugar Program.

What most Americans don’t realize is that the price they pay for sugar and related consumer goods in the U.S. is kept artificially high by the government. In fact the average wholesale price of U.S. domestic sugar is more than twice that of the average world price. For example, in August of 2015 U.S. sugar was priced at 33.13 cents per pound, while the world price was a mere 15.57 cents per pound.

The reason U.S. sugar prices are so high is due to a laundry list of protectionist policies put forth under the Federal Sugar Program that serve only the interest of the sugar industry at the expense of American consumers and taxpayers.

Currently the Federal Sugar Program imposes a minimum price for U.S. sugar and sets a limit on the amount of sugar domestic processors are allowed to sell. The Sugar Program also sets import quotas on sugar that limit the amount that can be imported. Taken together these policies keep prices artificially high while also preventing competition, amounting to a massive handout to “Big Sugar.”

As Senator Cruz pointed out in Tuesday night’s debate, sugar subsidies are one of the most egregious examples of “corporate welfare” in the U.S. and are the type of cronyism that is “bankrupting our kids and grandkids.” And Senator Cruz is exactly right, as the cost of supporting such corporate welfare falls squarely on the backs of American consumers and taxpayers.

Studies show the Federal Sugar Program cost U.S. consumers and businesses up to $3.5 billion annually. For taxpayers, the program cost almost a half a billion dollars between 2000 and 2001, and nearly $300 million in 2013. For 2015 the Congressional Budget Office predicts the sugar program will cost taxpayers an additional $115 million over the next 10 years.

While Senator Cruz’s vocal calls for an end to sugar subsidies in Tuesday night’s debate stood out, he is not the first presidential candidate to do so. In fact, last month Republican presidential candidate Jeb Bush argued for a phase out of U.S. sugar subsidies. A Bush spokesperson noted that Bush “believes we should constantly be moving to reduce government interference and create a level playing field for all commodities on the world market.”

It is clear that more and more candidates for president are realizing just how detrimental U.S. sugar subsidies are to American consumers and taxpayers, and anti-sugar subsidy rhetoric will likely be an increasing theme going forward. The disturbing truth is the Federal Sugar Program is now one of the most onerous examples of crony capitalism, rivaled only by that of the Ex-Im Bank, and until it is repealed Americans will continue to suffer from artificially high prices and billions in wasted taxpayer dollars. 


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Why don't you note that 2013 when the Mexican's were dumping sugar into the U.S. was the only time in 12 years that there was a taxpayer cost for U.S. sugar policy?! A little bias. Do you prefer subsidized world market sugar?


Wow I thought I was the only one educated on the sugar scammers

Obama's Carbon Rule Much Worse for States than Originally Anticipated

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Posted by Justin Sykes on Tuesday, September 8th, 2015, 12:53 PM PERMALINK

Last month the Obama Administration and EPA released the final version of their so-called “Clean Power Plan,” which seeks to regulate carbon in the U.S. While the President and his army of EPA bureaucrats tout the “flexibility” of the carbon rule, the reality is the rule is anything but flexible and will hits states the hardest. Projections show the finalized version of the carbon rule will have a much more devastating impact than originally expected in the proposed version.

For states, the finalized rule means massive energy rate increases and compliance scenarios that will prove crushing for their economies. The carbon rule offers two compliance scenarios, both of which are practically unworkable for states and will send energy rates skyrocketing.

It is projected that over 40 states will see double digit rate increases under the carbon rule, inevitably killing thousands of jobs and pushing integral industries to search for lower energy prices, potentially oversees. 

Worst of all is the impact the carbon rule will have on 22 states that were blind-sided by much more stringent emissions reduction targets in the finalized rule than in the proposed rule. Twenty-one of these 22 states enjoyed average electricity prices 12% below the national average last year. More stringent targets however mean residents will be paying more for energy and sectors such as manufacturing could soon leave states for more affordable climates.

For instance the reduction target originally proposed for North Dakota was 11%, yet the target contained in the finalized rule is almost 50%. Iowa, Kentucky and Wyoming were originally projected to see targets just below 20% but the finalized rule requires well over 40% reduction targets for each. States such as Indiana, Kansas, and Montana also saw their compliance targets roughly double in the final rule.   

Furthermore, in drafting the final rule, the assumptions made by Obama and the EPA are not only illogical but extremely misleading. In the final version the EPA assumed that roughly 100 GW of coal would inevitably be retired by 2020, even without the carbon rule. 

This assumption however is much larger than the 66 GW the EPA originally projected in the proposed rule or the 55 GW the Energy Information Administration projected. By assuming more coal retirement in the final version absent the carbon rules enactment, the EPA tries to misrepresent the actual impact the carbon rule will have on the industry.          

The final version of the rule also assumes that 41,000 MW of renewables such as wind would come on line by 2030. The EPA claims such sources would replace roughly 38,000 MW of coal the Agency projects will be retired during the same period.  However this swap is not only wildly impracticable but doesn’t take into account the unreliable nature of wind.

Because wind generation is so sporadic it is estimated that for such a drastic shift in energy supply to be effective over 170,000 MW of wind would actually be needed, as opposed to the 41,000 MW the EPA projects. The feasibility of doing so would require over 20 million acres of wind generation, a landmass the size of 16 million football fields or roughly the State of Indiana.    

As unclear and unforthcoming as the President and the EPA have been in disclosing the impact the final carbon rule will have on states, the one thing that is clear is a majority of states will be hurt. For the 40 or so states that will see double digit rate increases, or the 22 states facing compliance targets well above those initially projected, this rule will prove an economic disaster that ripples across the U.S. 


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By unelected bureaucracy, IL Dooshee means to do away with the states once and for all. As a constitutional law student he has studied the ways to go around elected officers of the government.......with their help of course.

Guy Daley

And Americans will overlook this in favor of more popular subjects like flag burning, encroachment by China, Russia, gay marriage and other BS that doesn't affect their pocketbook.

Gina McCarthy on Obama's National Energy Tax: "Minority communities will be hardest hit."

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Posted by Justin Sykes on Friday, August 21st, 2015, 2:10 PM PERMALINK

This month President Obama and the EPA released the final version of their “Clean Power Plan,” or as more aptly referred, the new “National Energy Tax.” The rule seeks to limit carbon in the U.S., and by the EPA’s own projections the benefits will be negligible, reducing global temperatures by 0.018 degrees by 2100 and sea level rise by a mere 0.20 millimeters by 2050. 

While the environmental impact of the carbon rules is virtually non-existent, the impact on American families will be disastrous. Projections show the carbon rule will likely increase electricity rates in the U.S. by double digits in over 40 states. Such rate increases amount to a regressive tax on the nation’s most vulnerable.

The overwhelmingly regressive nature of the carbon rule is why leaders in Washington, such as House Speaker John Boehner (R-Ohio), have chosen to describe the rule as “Obama’s National Energy Tax.” 

In a recent panel discussion in D.C., EPA Administrator Gina McCarthy admitted the disparate impact the new carbon rule would have stating, “We know that low-income minority communities would be hardest hit.” For once, Administrator McCarthy has chosen to be direct and open about what the rule really means for America’s most vulnerable populations. 

As Americans for Tax Reform has previously pointed out, and EPA Administrator McCarthy has now confirmed, the effects the new carbon rule will have on low-income and minority communities will be particularly devastating.

According to recent reports by the National Black Chamber of Commerce, American minority communities will see jobs losses, reductions in household income and increased poverty rates that are far above the national average.

The report found that as a result of the regressive nature of Obama’s carbon rules, by 2035 African-American communities will see cumulative job losses of almost 7 million. For Hispanic communities the losses will be well over 12 million.

Similarly, median household income for African-Americans would decrease by $5,000 over the next 20 years and Hispanics would see losses greater than $7,000. The carbon rule will also lead to skyrocketing poverty rates for Hispanics, who will see poverty rate increases above 26 percent. For African-Americans the report found poverty rate increases of over 23 percent. 

Administrator McCarthy and President Obama seem all to comfortable sacrificing the livelihoods of millions of hard-working Americans for essentially non-existent benefits. Sadly as a result of the carbon rules, some of America's most vulnerable could now find themselves thrust into poverty, many of whom have just managed to pull themselves out.


Photo Credit: Chesapeake Bay Program 

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USPS Post Half a Billion in Losses Despite Billions in Subsidies

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Posted by Justin Sykes on Thursday, August 13th, 2015, 10:28 AM PERMALINK

While government bureaucrats are notoriously inefficient at their core missions, such as the EPA polluting the Animus River, the one thing they are consistently efficient at is losing taxpayer dollars. In addition to the EPA’s recent bungles, the U.S. Postal Service this week continued its long tradition of hemorrhaging money.

This week the Postal Service reported a net loss of $586 million for the third quarter of fiscal 2015. The USPS’s ability to lose over half a billion dollars in just three months would almost be impressive if it wasn’t a detriment to American taxpayers. The fact is the USPS receives roughly $18 billion in taxpayer-backed subsidies annually yet is still failing.   

Despite this massive multi-billion dollar subsidies crutch, the Postal Service continues to prove incapable of financial accountability. The third quarter losses this week are not only a massive bureaucratic failure but also mean the Postal Service has now posted revenue losses 25 out of the last 27 quarters.

Given the $1.5 billion dollar losses posted in the previous quarter, 2015 could be the 9th consecutive year USPS has suffered multi-billion dollar losses. The Postal Service is now averaging about $5.5 billion in annual losses and within the last decade the Post Office endured over $47 billion in losses, a number that is only slated to grow.

As troubling as such massive losses are, the more troubling fact is the USPS machine is able to push on despite the overwhelming lack of fiscal accountability. Alternatively, if the Post Office were a private company it would have been bankrupt decades ago and a more efficient service would have taken its place.

Sadly, there is little motivation for efficiency or accountability when government bureaucrats know they have an $18 billion dollar taxpayer-sewn safety net to catch them. The truth is as long as billions keep flowing from the government losses will continue, and American taxpayers will be expected to keep footing the bill for these bureaucratic boondoggles.     


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ATR Statement on Obama's Finalized Carbon Emissions Rule

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Posted by Justin Sykes on Monday, August 3rd, 2015, 11:05 AM PERMALINK

This week the Obama Administration and EPA unveiled the final version of their carbon emissions rule under the Clean Power Plan. The finalized carbon rule will not only prove disastrous for American consumers and the economy, but is the greatest example of executive overreach to date. 

ATR President Grover Norquist issued the following statement today on the release of final rule:

“The President and EPA's Clean Power Plan is all burden with little or no benefit. For a promised 0.02 degrees decrease in global temperatures by 2100 and a reduction in sea level the thickness of 3 sheets of paper the President is willing to enact certain damage to American jobs and growth.  The rule is projected to cost more than  $350 billion, destroy hundreds of thousand of jobs annually and cause double-digit electricity rate increases in over 40 states.  The president is trying, late in his term, to create a "legacy" at the expense of the future of working men and women in America.”  

The carbon rule, which imposes inflexible and economically irresponsible reduction targets for each state, originally sought a 30 percent emissions reduction goal nationwide. However the final rule unveiled this week increased the reduction goals to 32 percent, a move that will surely exacerbate the disastrous economic impacts originally projected. 

The impact of increased rates and job losses under the rule will prove particularly devastating to the millions of low and middle income Americans already struggling under the President’s failed policies. American families with average household incomes of less than $25,000 spend an estimated 17 percent of their budgets on energy. A double-digit increase in energy costs will force many families to choose between necessities such as shelter and medical care, and putting food on the table each month. 

The final rule is also an outrageous affront to state sovereignty by threatening to impose a federal implementation plan if states fail to submit their own. States are now tasked with determining how best to defend their rights and protect residents from the widespread impacts of the rule.

A number of state Attorney Generals have already pledged to file lawsuits challenging the EPA’s authority to implement the rules, with more states expected to join in following this week’s release.  President’s Obama’s own legal mentor, Harvard Law Professor Laurence Tribe, has even challenged the legality of the rule saying: 

“The Proposed Rule lacks legal basis and represents an improper attempt by EPA unilaterally to remake a vast portion of the American economy on the basis of hitherto obscure provisions of the Clean Air Act” and that it “is a remarkable example of executive overreach and an administrative agency’s assertion of power beyond its statutory authority.”    

The carbon emissions rule is devastatingly bad policy that threatens to compromise grid reliability, increase electricity rates and destroy the livelihoods of millions of hard working Americans. Even though the final rule has been released, the fight is far from over.

Americans for Tax Reform encourages lawmakers and state officials to continue to push back against the EPA and Obama Administration’s unconstitutional affront to state sovereignty and American prosperity. 


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Obama's Birthday Wish List: Job Losses and Increased Poverty Rates

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Posted by Justin Sykes on Thursday, July 30th, 2015, 3:24 PM PERMALINK

Next week the Obama Administration and EPA will release the final version of the Clean Power Plan (CPP). In support of the rule, the President and EPA routinely cite to the benefits the CPP’s carbon emissions regulations will have on the American public and environment.

Yet such “benefits” are tenuous at best, largely based on questionable science and seldom founded in reality. The EPA’s own projections show the rule would amount to a 0.02 degrees Celsius difference in world temperatures by 2100 and sea level reduction equivalent to the thickness of three sheets of paper. 

However in stark contrast, the impact the President’s carbon regulations will have on Americans, especially the country’s most vulnerable are all too real. Consensus shows and the EPA has even agreed that the carbon regulations will lead to higher energy rates across the nation. Indeed double-digit increases are expected in over 40 states. 

While the President and his Capitol Hill cronies may not be impacted by rate increases, many of the countries most vulnerable will not be so lucky. A recent report by the National Black Chamber of Commerce found that the President’s carbon regulations could prove devastating for minority communities.

The Chamber’s report looked at job losses, decreased household income and increased poverty rates due to the carbon rule. The report showed that 200,000 African-American jobs would be lost just in 2020. During that same period over 300,000 jobs would be lost in Hispanic communities. The cumulative impact by 2035 would be almost 7 million African-American jobs lost and over 12 million for Hispanics. 

Additionally, the report projected that the carbon regulations would reduce median household income for African-Americans by more than $5,000 within the next 20 years. For Hispanics the impacts would be even worse, with reductions over $7,000.

However the most troubling finding of the report was the impact on poverty rates resulting from reduced income and job losses. For African Americans the poverty rate is slated to jump by 23 percent and Hispanic poverty would grow by 26 percent.       

It appears that the Obama Administration and the EPA are more than willing to ignore such devastating impacts, all in the name of preserving the President’s legacy. In fact it is rumored the final rule may be released on President Obama’s birthday, August 4th.

Sadly, while the President is blowing out his candles next week, many of the country’s most vulnerable will be preparing for the worst. Thus on behalf of the millions of Americans soon to be teetering on the brink of poverty as a result of the Clean Power Plan…Happy Birthday Mr. President.  


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Speaker Boehner Endorses Lifting the Crude Export Ban

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Posted by Justin Sykes on Thursday, July 30th, 2015, 9:18 AM PERMALINK

Speaker John Boehner (R-Ohio) this week came out in support of lifting the decades old ban on the export of U.S. crude oil. 

Speaking at a press conference on Wednesday, Speaker Boehner stated, “Lifting the ban would create an estimated 1 million jobs here at home, jobs that would frankly get created in every state. It would help bring down prices at the pump for consumers, and it will be good for our allies.” 

Since the 1970's the U.S. has had a ban in place on the export of crude oil. The ban was originally enacted to protect U.S. supplies in response to decades of declining domestic production and issues in the international oil market. 

Yet in recent years the U.S. has experienced a renaissance in energy production, thanks in part to improvements in extraction and exploration methods, and it is increasingly evident the ban is no longer justified. As Speaker Boehner alluded, the economic benefits of lifting the ban would ripple throughout the economy and extend to all states, not just producers.

An overwhelming number of studies project lifting the export ban would create hundreds of thousands of jobs annually, increase household income for millions of Americans and lower domestic fuel prices. A recent study by the Government Accountability Office (GAO) stated that lifting the ban would increase the “size of the economy…employment, investment, public revenue and trade.”

The Speaker’s support finds widespread, bipartisan company with a growing number of those in Congress. On the House side Congressman Joe Barton (R-Tex.) has introduced legislation to lift the ban and Senators Lisa Murkowski (R-Alaska) and Heidi Heitkamp (D-N.D.) are leading a similar effort in the Senate.

Speaker Boehner’s endorsement for lifting the ban is a productive step forward. Americans for Tax Reform encourages members of Congress to follow the Speaker’s lead in supporting an end to this outdated relic of 1970’s era policy.


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Obama Carbon Regulations could leave Manatees out in the cold

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Posted by Justin Sykes on Wednesday, July 29th, 2015, 9:50 AM PERMALINK

President Obama and the EPA are expected to unveil the final version of their Clean Power Plan (CPP) next week. While criticism of the rule has centered on the economically disastrous impact the CPP’s carbon emissions regulations will have, some in Washington are crying foul for a different reason – that the regulations could leave hundreds of Florida manatees out in the cold…literally. 

It’s no secret the President’s carbon regulations will force the premature retirement of coal-fired power plants across the U.S. In fact the President seems wholly indifferent to the thousands of jobs and livelihoods he’s destroying. However what the President and EPA did not count on is that some of the power plants that will be shuttered are integral to the survival of hundreds of Florida manatees.              

The issue stems from the fact that the warm-water discharge from some Florida coal-fired power plants, such as Florida’s Big Bend Power Station, has become home to hundreds of West Indian manatees. The manatees are drawn to the warm-water discharge for a nearly six-month period in the winter.

In fact, as reported by the Washington Times, the Big Bend Power Station actually created a “Manatee Viewing Center” in 1986 with nature walks and observation platforms for visiting tourists. Thus the likely closure of such plants under the Clean Power Plan would have a profound impact on the manatee populations that rely on such sanctuaries to survive during the winter months. 

However in drafting the soon to be released Clean Power Plan, the President nor EPA took these impacts into consideration as would otherwise be required under the Endangered Species Act.

“This is troubling for the manatee, but even more disturbing is the possibility that the Obama administration would strategically disregard the law when it serves their interests or the President’s legacy,” said Julia Bell, press secretary for the House Natural Resources Committee.

The EPA has deflected charges the Agency failed to take into account the impact on certain endangered species like the Florida manatee, instead arguing the choice to close such power plants will be left to the states. However this argument holds little water given the Clean Power Plan’s compliance standards leave states with almost no “choice” but to shutter the plants.

While the outcome of this dilemma is still unclear, what is overwhelmingly clear is that nothing, not the destruction of thousands of people’s livelihoods or even the Endangered Species Act, will prevent the President from doing what he has to do to preserve his legacy.     


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