Durbin Cosponsors Bill To Reform The Sugar Program And Save Consumers Billions
High sugar prices are responsible for 125,000 jobs lost in the U.S. sugar-using industries since 1997
[WASHINGTON, D.C.] – U.S. Senator Dick Durbin (D-IL) today cosponsored a bipartisan bill that would reform the U.S. sugar program which supports artificially high sugar prices and cost consumers and businesses an estimated $14 billion since 2008. The sugar program hurts American workers by driving good jobs overseas; it hurts American consumers by increasing the price of products made with sugar; and it hurts sugar producers by driving down long term demand for their product. It is estimated that high sugar prices are responsible for 125,000 jobs lost in U.S. sugar-using industries since 1997.
“Illinois has lost thousands of good-paying jobs in the food and candy industry as companies have closed plants or moved them offshore in order to compete with imported products made with much cheaper, world-priced sugar,” said Durbin. “It’s estimated that for each sugar growing and harvesting job saved through high U.S. sugar prices, nearly three confectionery manufacturing jobs are lost. The sugar policy reforms in today’s bill are good for farmers, consumers, processors, and taxpayers.”
The Sugar Reform Act – written by U.S. Senator Jeanne Shaheen (D-NH) – is also cosponsored by U.S. Senator Mark Kirk (R-IL) and seven other Senators. The legislation would reform the sugar program by:
- Reducing taxpayer liability for expensive bailouts. The 2008 Farm Bill raised sugar price supports to a higher level. In 2013, this led to a nearly $300 million bailout of the sugar industry. Reducing these rates would help put prices back in line with historic levels and reduce liability for taxpayers.
- Repealing unnecessary trade restrictions. The 2008 Farm Bill required the U.S. Department of Agriculture (USDA) to set import quotas (also known as tariff-rate quotas) at a legal minimum each year, with very limited flexibility to respond to changing market conditions as needed. This bill would repeal these additional restrictions and provide greater flexibility to those implementing the program.
- Repealing the Feedstock Flexibility Program. The 2008 Farm Bill added a program that requires the government, if sugar prices fall below guaranteed levels, to buy surplus sugar and then sell that sugar to ethanol companies at a loss. This bill would save taxpayers from footing the bill for keeping prices high.
Reforming domestic supply restrictions to provide more flexibility to USDA. The USDA sets detailed quotas known as marketing allotments to restrict the amount of sugar domestic producers can sell. The 2008 Farm Bill limited the USDA’s flexibility to adjust these allotments as demand changes and set an additional legal requirement that domestic producers are guaranteed at least 85 percent of domestic sugar demand. This bill would eliminate that guarantee and would restore the Secretary of Agriculture’s authority to modify or suspend these allotments.
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