AGRICULTURE Secretary Richard Lyng has announced he will be compelled to cut sugar import quotas another 25 percent next year. The disastrous step is further evidence of the vast harm done by this misconceived program. For the benefit of a few thousand U.S. producers and the giant corn syrup industry that lurks behind, the country has been turned into a great sugar castle. Prices on the inside are kept artificially high, now nearly three times the world price.
But the thing is all artfully done with no hands, and leaves no fingerprints. Unlike the other price support programs, there are no sugar funds to be defended in the budget. The industry and its congressional parrots can croak that the sugar program doesn't cost the taxpayer a dime. The reason, of course, is that the taxpayer's first cousin, the consumer, does the paying. The enforcement mechanism is the quota system. The agriculture secretary, who is made the heavy, is required to keep out just enough foreign sugar to keep the domestic price at the stipulated level.
Of course, the U.S. industry thrives in this protectionist greenhouse. The losers, in addition to the consuming public, are foreign producers. No matter that prominent among these are important but vulnerable allies such as the Philippines and weak Third World economies such as those in the Caribbean whom it is official U. S. policy to help.
U.S. sugar quotas have been cut 75 percent in the past four years. Imports next year are now scheduled to be the lowest since 1875. The pressure is increased as manufacturers of sweetened products take their processes outside the country. Why not, when the cost of sugar there is so much lower? Higher imports of sweetened products mean lower U.S. demand for commercial sweeteners and thus require that sugar imports be reduced still further.
The domestic industry says it isn't the villain; the Europeans are, because they subsidize their farmers, producing a surplus which they then dump on the world market, depressing the price. The Third World producers are only stalking horses in this view; in effect we'd be ceding territory to the non-needy Europeans if we let more foreign sugar in, say the U.S. producers. But there's a lot of middle ground between such capitulation and the organized heist in behalf of producers that is in force now.
The administration rightly wants to reduce the support price and make U.S. producers fight it out on something closer to level ground. You'd think Congress would go along, if only because so many more people eat sugar than grow it. But the agriculture committees have only one ear on this subject. Perhaps when we finally shut the door entirely to foreign sugar, the country will wake up.