Monday, October 31, 2011

Taxpayers Tricked Into Treating Sugar Farmers

Taxpayers Tricked Into Treating Sugar Farmers

When you dig into your Halloween candy this year, does it taste twice as good as it did a few decades ago? Over the last 30 years, sugar subsidies have effectively doubled the price U.S. consumers pay for sugar. Annual food costs have increased by about $9 per person over that time--which doesn't sound that large until you tabulate the $1.7 billion net gain to U.S. sugar growers. The sugar costs twice as much, but is the candy twice as sweet? No.

As Vince Smith and Michael Wohlgenant, two agricultural economists, wrote this summer, "That is a lot of candy to share among less than 20,000 relatively wealthy sugar farmers." They’re not alone in recognizing this spooky policy. Congressmen Joe Pitts (R-Pennsylvania) and Danny Davis (D-Illinois) have called the sugar program "an outdated and tightly controlled government program that is long overdue for reform."

The true scare comes from the findings in Wohlgenant’s American Boondoggle paper: every dollar of these farm benefits to sugar programs costs the U.S. economy 76 cents because of economic inefficiencies. Should the Farm Bill really be a vehicle for transferring income to wealthy farmers and landowners from poorer average consumers?

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