Would you like the government to guarantee that your business makes money every year? Would you like the government to purchase your products if no one wanted to buy them? How about some government-backed low interest loans to keep your business going? If so, then consider growing sugar.
But once you consider growing sugar, you might find something else astonishing: the government also controls who can process sugar. You can only sell your product to a handful of big processors. No other agricultural product has the same deal. Not corn, soybeans, wheat or cattle.
This sweet deal for sugar growers and processors comes at a cost to American consumers and sugar using companies. The government effectively guarantees a minimum price for sugar and then strictly limits imports. At times, the world market price for sugar is almost half that of the United States price.
This costs consumers some $4 billion a year in added costs. These increased costs are greatly magnified for businesses that use sugar. That doesn't just mean makers of candies and other sweets. Many common foods you buy at the grocery store contain some sugar.
Sugar-using industries in the United States have been hurting because of the high price of the commodity. According to the Department of Commerce, these industries lost 112,000 jobs between 1997 and 2009. While there aren't official numbers for the past few years, there have certainly been more casualties of high sugar prices.
Before they finally went bankrupt after stalled labor talks, Twinkie-maker Hostess also blamed high sugar prices for their failing business. Hostess certainly went bankrupt for many reasons, but sugar policy may have been a big contributor.
My colleague, Congressman Danny Davis (D-IL), has seen many companies in his native Chicago shut their doors and layoff employees. At one time, the town was known as the "Candy Capital of the World."
Depression-era federal policies protect sugar growers and processors, they don't protect sugar-using industries. When the world market price is much lower than that in the U.S., foreign food manufacturers have a big advantage.
I think it's long past time for the United States to create a fair sugar policy for everyone. Congressman Davis and I have introduced legislation supported by other Democrats and Republicans across the country that would reform domestic supply restrictions, lower price support levels and ensure adequate sugar supplies at reasonable prices. Senators Jeanne Shaheen (D-NH) and Mark Kirk (R-IL) have introduced identical legislation in their chamber. Pennsylvania Senator Pat Toomey (R) is a major supporter of this bill.
Our effort to reform U.S. sugar policy isn't about providing cheap sugar. Certainly, a healthy diet doesn't have a lot of sugar in it. What this is fundamentally about is protecting American jobs by promoting a fair policy.
The government shouldn't be playing favorites. While our bill recognizes the importance of having a domestic sugar industry, it also maintains that the American taxpayer shouldn't have to pay in jobs, added costs, and subsidies in order to have one.
Sugar prices have been low recently and the current policy puts the government on the hook for paying to cover sugar growers' losses. The government may have to purchase $80 million in raw sugar this year. While deficits are leading to cuts for other programs, sugar growers could see a huge payday.
Next week, Senator Toomey and I are going to be visiting the Pepperidge Farm facility in Denver, Pa. Workers there make cookies and crackers including the famous Goldfish Crackers. Other major Pennsylvania companies are affected by sugar prices like the makers of Peeps, the Just Born company in Bethlehem, and both Mars and Hershey, who both have facilities across the state. We also can't forget about all of the smaller confectioners and food businesses that are struggling to stay alive.
All told, there are more than 600,000 jobs in sugar using industries scattered across the country. To compare, there are fewer than 5,000 sugar farms nationwide.
We have a real opportunity to reform this program when the House considers a new farm bill later this year. I'm working across party lines and with members from every corner of the U.S. to get our bill included in this larger legislation.