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National Taxpayers Union joins to reform US Sugar Policy

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Douglas Yu

By Douglas Yu+

16-May-2016
Last updated on 16-May-2016 at 13:11 GMT2016-05-16T13:11:07Z

The US Sugar Program cost taxpayers almost a half billion dollars between 2000 and 2001 and nearly $300 million in fiscal year 2013.
The US Sugar Program cost taxpayers almost a half billion dollars between 2000 and 2001 and nearly $300 million in fiscal year 2013.

National Taxpayers Union (NTU) has joined the Coalition for Sugar Reform to transform the US sugar policy, the Coalition announced.

The Coalition for Sugar Reform consists of consumers, food manufacturers, trade advocates, taxpayer watchdog organizations and other interests, according to the Coalition’s spokesperson, Jennifer Cummings.

“The Coalition’s objective is to bring about reform and change to the federal government’s overly restrictive sugar program that has increasingly failed to provide adequate supplies of sugar to the U.S. market,” she said.

NTU, on the other hand, is a citizen group founded in 1969 to work for lowering taxes and reducing 'wasteful spending' in government to achieve economic freedom, said President Pete Sepp.

What’s flawed about the US sugar program?

The US sugar program, according to USDA’s website, “uses price supports, domestic marketing allotments, and tariff-rate quotas (TRQs) to influence the amount of sugar available to the US market.”

“Sugar manufacturers are given a non-recourse loan based on a set sugar price by the US government. If the actual market price falls below the set price, they don’t have to pay the amount of loan back. Essentially the loan margin becomes their profit,” Sepp told ConfectioneryNews.

In addition, raising the price of sugar could equally increase the price of the products made with sugar, and would financially damage confectionery businesses, Sepp added. Those businesses need to re-evaluate if they have to scale back their operations because the sugar cost is so high.

“That’s why many candy companies moved their manufacturing to other countries where the cost of sugar is lower,” he said.

At the same time, the Coalition believes the US Sugar Program is a “net job killer”.

“Between 1997 and 2014, US sugar-using industry jobs declined by 18%. Our Coalition believes outdated US sugar policies are behind much of that decline,” Cummings said. “The industry, which once employed more than 700,000 American workers, has experienced a decline of 132,000 jobs, according to the US Census Bureau 2014 Annual Survey of Manufactures.”

Cummings added the program cost taxpayers almost a half billion dollars between 2000 and 2001 and nearly $300 million in fiscal year 2013.

“The Congressional Budget Office’s March 2016 Baseline for Farm Programs forecasts the US sugar program will cost taxpayers $138m over the next 10 years,” she said.

A diverse pool towards one direction

The Coalition for Sugar Reform believes NTU is an important voice on issues impacting US taxpayers, and it looks forward to working with the union organization to continue working with the congress to reform the Sugar Program.

As of January this year, US raw sugar is priced at 25.76¢ per pound, and refined sugar costs 32¢ per pound for US food manufacturers and grocery stores, according to American Sugar Alliance.

“I think we need a diverse pool of people to come together to fight for almost any unfair agricultural policies, such as manufactures, anti-hunger advocates and taxpayers,” Sepp said. “I know that the Coalition has a lot of legislative solutions that we’ve supported for many years, that’s why we decided to join them.”

1 comment (Comments are now closed)

Cuba

These programs were put in place at the behest of the US sugar lobby (Texas and Hawai'i, mostly) after the US broke off diplomatic relations with Cuba, then our major supplier. The recent normalization of relations with Cuba may have more of an impact than advocacy groups.

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Posted by Fazal Majid
16 May 2016 | 20h252016-05-16T20:25:58Z

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