Government Interference Ruins Yet Another Industry — Sugar

A recent study from my R Street Institute colleague Nan Swift, a resident fellow in our governance program, shows that artificially sweetening sugar-industry prices comes at a high economic cost for other industries, which is, quite frankly, how all these tariffs and trade restrictions end up working:

High sugar prices put U.S. food makers at a competitive disadvantage and kill jobs. A 2006 Commerce Department report found that for every one domestic sugar-growing or harvesting job, three confectionary jobs are lost. A more recent study found modest job growth, 17,000 to 20,000 additional jobs, from sugar program reforms. But in the meantime, many candy makers have moved production to Canada or Mexico where sugar can be found for half the price…

As Swift further explains, “With high prices guaranteed by the U.S. government and little-to-no consumer choice, there’s no incentive to innovate or ensure that land, capital and human resources are being put to their best, most rewarding purpose.” As Reagan famously said, “Nothing lasts longer than a temporary government program.” That certainly seems true for the federal sugar program. If the GOP is interested in restraining government, here’s an easy program to target.