To see why Congress should reform federal farm policy, look no further than the program that covers sugar production.
The federal sugar program costs American consumers $2.4 billion to $3.5 billion a year and produces a net loss of 10,000 to 20,000 U.S. jobs, according to studies from North Carolina State University, Iowa State University and the U.S. Commerce Department.
It has been a factor in decisions to move manufacturing of Fannie May and Brach's candies to Mexico and Life Savers to Canada. It even played a role in the bankruptcy of Hostess, the maker of Twinkies and cupcakes.
Grade those results against the farm policy goal of assuring adequate food supplies at affordable prices and, as a side benefit, supporting jobs. The sugar program flunks on all counts.
The sugar program is part of the U.S. farm bill, which comprises the food stamp program and an array of policies that influence agribusiness. Wisconsin agriculture benefits from several of the policies, including programs that support dairy and corn prices. But agribusiness, consumers and taxpayers could benefit more if Congress would reform farm policy to make it more cost-effective and update it for the global marketplace and environmental concerns.
The sugar program deserves top priority because of its negative effects. It limits the amount of sugar that mills and processors can produce, and it limits the amount of sugar imported into the country. Together, these market constraints squelch competition.
As a result, American buyers pay 30 percent to 50 percent more for sugar than do buyers in other countries. That is costly for consumers and also puts food and beverage producers at a competitive disadvantage unless they move abroad to get lower sugar prices.
Sugar processors and producers are lobbying to retain their sweet deal, no matter how costly it is to the rest of the nation. They argue they need to be protected from foreign competitors, which are able to sell at lower prices because they are subsidized by their governments. But that argument only means other nations' sugar programs keep prices low while the U.S. program keeps prices high. That's just the sort of nonsense that begs for reform.
The farm bill is up for debate this year. With the federal budget deficit putting a focus on cost-effectiveness and job creation, the sugar program should be a trigger for reform.