U.S. Senators Lamar Alexander (R-TN) and Bob Corker (R-TN) are asking for changes in the proposed farm bill’s sugar policy in order to protect 15,000 Tennesseans employed by industries that use sugar in producing their goods.
In a letter to the Chairman and Ranking Republican Member of the Senate Committee on Agriculture, the Senators raised concerns that the version of the farm bill passed by the U.S. House of Representatives contains sugar provisions that would hurt many American workers and consumers. The House version contains provisions that go further in artificially inflating sugar prices in the U.S. at a higher rate than world markets, costing taxpayers and jeopardizing jobs in the food and beverage processing industry because the production of goods containing sugar would become more expensive.
“The current sugar policy will already cost taxpayers $1.3 billion over the next decade and this new version would cost even more,” said Alexander. “At least 15,000 food industry jobs in Tennessee depend on sugar because it’s an ingredient in so many products. A policy that would raise the price of sugar only in the United States could cause those Tennessee jobs to be shipped overseas.”
“This is about fairness and protecting Tennessee jobs,” said Corker. “The sugar provisions passed in the House give protections to sugar growers that are leaps and bounds above those given to other commodities, and they create artificially high sugar prices which could cause thousands of Tennessee food manufacturing jobs to move to foreign countries where sugar prices are lower.”
Full text of the letter is below.
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Dear Chairman Harkin and Ranking Member Chambliss:
We are writing to express our strong opposition to the sugar provisions contained in the farm bill passed by the House of Representatives (HR 2419) and to urge you to reject all efforts to include such provisions in the Senate farm bill.
Current sugar policy costs American jobs by maintaining an artificial gap between U.S. and world sugar prices. The existing sugar program increases consumer costs, distorts market signals and is not even in the long-run interest of the producers it purports to help, since the current sugar program is slowly eroding the demand base for U.S. sugar. The Congressional Budget Office says current policy will cost taxpayers $1.3 billion over the next decade.
Unfortunately, the farm bill passed by the House makes a bad sugar program much worse. H.R. 2419 would --
- Require the federal government to buy surplus sugar and then sell it -- at a significant loss -- for use as an ethanol feedstock;
- Increase price supports, encouraging overproduction not only in the United States but also in Mexico, which will be part of an integrated North American market on January 1, 2008;
- Place even more restrictions on sugar imports, in ways that likely violate U.S. international obligations and therefore could trigger further trade retaliation against U.S. grains, oilseeds, meat, poultry and other farm products; and
- Remove USDA's ability to control program costs by setting aside 85% of the U.S. market for domestic production.
The House-passed sugar provisions provide protections to sugar growers far in excess of those afforded to producers of any other agricultural commodity. Those provisions jeopardize jobs in the food and beverage processing industries of the economy. They impose significant added costs on consumers and taxpayers. They invite retaliation against U.S. farm exports. And they undermine the very interests they are supposedly designed to protect.
For all these reasons, we strongly urge you to oppose all attempts to include the House-passed sugar provisions in your Senate farm bill.