FOR IMMEDIATE RELEASE: September 15, 1995

Contact: Amy Moritz (202) 543-4110

The fate of what may be the nation's most destructive and counter-productive agricultural program may be decided Wednesday, September 20 when the full House Agriculture Committee decides the future of the federal sugar program.

"The federal sugar program is corporate welfare, but it is worse than most corporate welfare programs because it does more than waste taxpayers' money -- it kills jobs and raises consumer prices," said Amy Moritz, President of The National Center for Public Policy Research. Moritz notes several serious problems:

• The sugar program costs U.S. consumers $1.4 billion each year (according to the federal General Accounting Office) by doubling domestic sugar prices. As U.S. News and World Report said in its July 17, 1995 issue: "What the federal government does is fix the domestic [sugar] price at around 22 cents a pound through a combination of loans, market divisions and, most important, strict import quotas: the current world price is less than 10 cents a pound."
  
• The federal sugar program has killed thousands of American sugar industry jobs because U.S. producers have to compete with foreign producers who can price their sugar at half the American price. Since 1982, almost half of America's cane sugar refiners have shut down as a result.
  
• The federal sugar program raises the cost to taxpayers of the food stamp program by $90 million per year.
  
• The federal sugar program benefits a small number of wealthy sugar producers at the expense of taxpayers and consumers. The top 1% of sugar growers receive 42% of all benefits, and the top 20% of all growers receive 75% of all benefits. One Florida family alone receives over $65 million a year from the sugar program.
  
• The federal sugar program provides a $200 million annual subsidy to foreign sugar producers.
  
• The federal sugar program is wasteful corporate welfare. Though the St. Petersburg Times is based in a top sugar-producing state, it nonetheless concluded in an April 16, 1995 editorial: "The sugar industry has yet to present a convincing case that it can't survive without price supports. The time has come for this wealthy industry to wean itself from price supports." USA Today opined on June 5, 1995: "The sugar scheme, now up for renewal in Congress, leaves nothing to chance -- or the threat of competition. The federal government controls the price. The government limits imports to keep the price high. When that doesn't work, Washington dictates how much domestically produced sugar can be sold. In short, it's a government-run cartel."
  
• The federal sugar program has been kept alive not by merit but by campaign donations. According to the Center for Responsive Politics, sugar lobbyists have donated over $11.9 million to candidates and PACs since 1979 to keep the program going. USA Today says: "[Sugar producers] reward Congress members who vote the right way with campaign contributions. The 178 current members who voted Big Sugar's way in 1990 have received an average $9,538 from sugar political action committees. The 47 who voted the wrong way got $653 each."

The legislation that comes closest to ending the problems caused by the sugar program is H.R. 1687, sponsored by Representatives Dan Miller (R-FL) and Charles Schumer (D-NY). The bill is a step in the right direction but does an incomplete job: it would kill the domestic sugar program but leave foreign import quotas (which contribute to higher sugar prices for American consumers) in place.

The desire to kill the sugar program is bi-partisan: H.R. 1687 has 102 co-sponsors from both parties, including key conservative Republicans (including Majority Leader Dick Armey [TX] and Budget Committee Chairman John Kasich [OH]) and leading liberal Democrats (including Henry Waxman [CA] and Barney Frank [MA]). But their efforts may not be enough: House Agriculture Committee Chairman Pat Roberts (R-KS) has the most influence over the fate of the sugar program, and he has not pledged to kill it.

"If the House can't take the relatively easy step to reform a federal program that raises prices and kills jobs, how will it ever take the tough steps needed to balance the federal budget?" asked Moritz. "The federal sugar program -- all of it -- should be killed. Immediately."

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