Lugar Again Seeks to Kill U.S. Sugar Program

Sen. Dick Lugar (R, Ind.) has re-introduced legislation to repeal what he calls "the hidden, anti-competitive sugar tax."

Sen. Dick Lugar (R, Ind.) has re-introduced legislation to repeal what he calls "the hidden, anti-competitive sugar tax." The proposal would tear down a government program designed to protect U.S. sugar farmers from having to compete with most foreign imports.

Each year, USDA sets a tariff rate quota that allows in 1,231,497 tons of imported sugar — the minimum amount set in a World Trade Organization agreement — and then monitors domestic supply and demand to see if that quota should be widened. USDA is bound by Congress not to increase the quota before April 1. Tight supplies in the United States forced the USDA to increase the quota twice last year.

The U.S. sugar program also controls how much domestically produced sugar is allowed into commerce by issuing strict selling allocations to U.S. farmers. Lugar's bill seeks to do away with the controls on domestic and international sugar.

"The New Deal-era sugar program has been big government at its worst for decades," Lugar said. "It picks the pocket of every American with a hidden tax, drives jobs overseas, and enriches a handful of powerful sugar producers in the United States. It is one of the worst forms of government interventionism in America."

The bill was welcomed by bakers, candy makers and other food companies dependent on large quantities of sugar that have long complained that U.S. sugar policy kept prices artificially high. 

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