SUGAR IS one of the most heavily protected commodities that Americans produce -- to the great benefit of the producers. The present system is holding the American price of sugar nearly twice as high as the world price. Congress steadfastly refuses to abolish the supports or to modify them or reduce them even slightly. Periodically it takes up proposals for reform and votes them down after debates demonstrating that the majority remains impervious to the country's larger economic interests.
The debates follow a well-worn pattern. The reformers point out that protection for sugar costs American consumers some $1.9 billion a year. Sugar's defenders, echoing an ancient grievance of farmers, reply that the cost of sugar is only a small fraction of the cost of a candy bar or a can of soda, and price cuts would be gobbled up by the middleman. The support system, they say, stabilizes the price of sugar -- and that's true. But it stabilizes the price at a level that's too high, encouraging more production of a crop that's already grossly in surplus worldwide. When the United States cuts its quotas for imported sugar, it does severe damage to the vulnerable economies of small countries in the Caribbean and Latin America. To which the protectionists answer that the European Common Market's behavior is much worse, since its supports are higher, its surpluses are huge and it dumps them on world markets.
That's right. The United States is now locked in a furious quarrel with the Europeans over agricultural subsidies. The American position in these negotiations is undercut by the sugar support program here, for it flagrantly violates the same international rules of trade that the United States is attempting to strengthen and broaden for the benefit of all American exporters. As Rep. Sam Gibbons (D-Fla.), an authority on the subject, said last month, "We cannot get anybody to come to the table and honestly negotiate with us if we are not going to follow the rules after we have adopted them."
Technically, this argument is over a relatively minor piece of the agricultural price-support system. But in a deeper sense it is over the integrity of American trade policy. The sugar supports, and the import quotas that enforce them, are becoming a test of the United States' readiness to meet the principles that its negotiators are trying to apply worldwide. At a time when both the Senate and the House are full of orators celebrating the virtues of free markets and open economies, they have an opportunity to vote for one small but specific application of those powerful ideas. But they keep retreating and flunking the test.