Sugar-Coated Nonsense

Sen. Kent Conrad, the North Dakota Democrat, argued at a Senate hearing that the passage of the Dominican Republic-Central American Free Trade Agreement, better known as CAFTA, would devastate the U.S. sugar industry. Unfortunately, he’s wrong -- the treaty would barely make a dent. But it’s a welcome start.

The sugar industry -- a politically powerful confederation of sugar cane growers in Florida and Midwest beet farmers -- is a national embarrassment. Washington sets quotas on imported sugar and a guaranteed price for raw sugar that is more than twice the global price. This dearly costs consumers and other industries that rely on sugar.

Making America’s commitment to free trade a sugar-free proposition has also cost the nation dearly, by signaling to the world that we only really mean all that free-market talk when it comes to products that we can grow or make more efficiently than others. It’s the kind of hypocrisy that does wonders for anti-Americanism.

That is why it was so important for the Bush administration to keep sugar on the table during the CAFTA negotiations, much to the industry’s dismay. Still, the treaty’s expansion of the Central American sugar import quota is so modest that in the first year of the treaty’s implementation it only amounts to one day’s production of the U.S. sugar industry. The sugar lobby’s fear, of course, is that this establishes a precedent for chiseling away at the U.S. market in further agreements. CAFTA is beneficial to both the United States and Central America, and it’s preposterous for senators from sugar-growing states who otherwise support free trade to oppose it. The administration must avoid any foolish last-minute deals with the sugar barons to gain their support.

It defies all economic reason for the United States to grow most of the sugar it consumes. And this isn’t a matter of standing up for principle over jobs -- plenty of jobs in the candy industry have been lost as a result of our artificially inflated sugar prices, as companies relocated to countries that are part of the global sugar market.