Next week, the House of Representatives is expected to vote on H.R. 2, the Agriculture and Nutrition Act of 2018.
The legislation includes important reforms to the Supplemental Nutrition Assistance Program (SNAP) that ensures the program promotes upward mobility while simultaneously protecting the most vulnerable in our society.
However, in its current form, the Farm Bill fails to address other market distorting subsides. One key way lawmakers can improve the bill is by including reform to the sugar program.
For too long, American consumers, workers and taxpayers have been harmed by sugar subsidies. Members of Congress have an opportunity to reform this archaic program within the farm bill by supporting an amendment by Representative Virginia Foxx (R-N.C.).
Enacted in 1934, the U.S. sugar program includes numerous market distorting tools to inflate the price of sugar including import quotas, loans, marketing allotments, price supports, and tariffs.
Because of this program, Americans pay almost twice the world price for sugar, raising prices for businesses and consumers.
Every year, Americans spend between $2.4 and $4 billion more on sugar than market prices dictate because of sugar subsidies. At the same time, taxpayers have been forced to foot the bill for millions of dollars in bailout money for loan defaults and other subsidies.
This program has also cost more than 123,000 manufacturing jobs since 1997, and the Department of Commerce estimates that every sugar-producing job protected through high U.S. sugar prices has come at the cost of three manufacturing jobs lost.
Support for reform is bipartisan and bicameral. Legislation to reform the sugar subsidy, the Sugar Policy Modernization Act of 2017 (H.R. 4265/S. 2086), has been introduced in the House by Representatives Foxx and Danny Davis (D-IL) and in the Senate by Jeanne Shaheen (D-NH) and Pat Toomey (R-PA) in the Senate.
- First, the amendment will repeal import quotas that raise the price of sugar.
- Second, the amendment will grant the Department of Agriculture more flexibility over administering the sugar program.
- Third, taxpayers would no longer be responsible for loan defaults by large sugar processors.
- Lastly, marketing allotments (the amount of sugar the government tells beet processors and cane mills they can produce) and the Feedstock Flexibility Program (which requires the government to buy sugar surpluses and sell it to ethanol plants at lower prices) would both be repealed.