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Another Sugar Policy Critic Swings and Misses

(Chuck Muth) – In what I take to be a clear indication the COVID crisis is easing, critics of U.S. sugar policy are back at it in 2022, complete with what Big Tech would call “misinformation.”

Writing for the Daily Iowan, Shahab Khan perpetuates the claim that “it is in the best interest of the federal government to scrap the U.S. sugar program.”

To reach that conclusion, Mr. Khan trots out the old saw that “American consumers pay more than double for the commodity compared to the rest of the world” while arguing that “the federal government’s policies need to focus on…providing consumers with inexpensive goods.”

Naturally, Mr. Khan chooses to ignore the international market reality that has resulted in the U.S. policy of modest tariffs and import restrictions on sugar from certain global competitors:

Foreign government subsidies.

U.S. sugar producers receive NO taxpayer subsidies for their product.

Mr. Khan argues that a given foreign country has a “comparative advantage” when the cost of producing a product “is less than another country’s cost of producing that good.”

But in this case, the advantage isn’t due to a lower cost of production, but in government subsidies that artificially deflate the true market cost of production.  Indeed, India was recently sanctioned for this by the WTO (World Trade Organization).

Mr. Khan also conveniently ignores that fact that domestic U.S. sugar costs today about what it did thirty years ago.  So increases in the cost of sugar-infused sweets-and-treats has little to do with U.S. sugar policy, especially in the current economic environment of rising inflation on just about ALL products.

If folks such as Mr. Khan want to zero out the U.S. sugar program and current policies, the first step is for international “cheaters” to zero out their government subsidies.  It’s only a “free market” if competitors are competing freely AND fairly without artificial support.

Zero for zero.  It’s the only American policy that makes sense.