Sugar Industry Wins Battle in House Farm Bill

(Dailycomet.com) – Sugar growers scored a sweet victory on Capitol Hill over big candy and soda manufacturers on Thursday as Louisiana lawmakers and other opponents easily sent a proposal to gut sugar subsidies down to a bitter defeat.

But in a major political setback, House Republicans failed today to pass the $867 billion farm bill , which also aimed to impose strict new work requirements for food stamp recipients. Conservatives refused to support the measure unless House leaders agreed to hold a vote immediately on a separate immigration bill.

Republicans in the meantime are vowing they will get a five-year farm bill passed by the end of September, when the existing one expires.

The familiar battle over federal programs to prop up sugar prices had earlier appeared to be a key conflict in the contentious congressional effort to pass the farm bill, a sprawling once-every-five-years package of federal agricultural subsidies and nutritional programs.

Critics, including a cadre of free-market conservatives, have for years lambasted the system of sugar subsidies as a boondoggle that jacks up sugar costs for consumers. A combination of domestic production limits, caps on imports, loans and price supports have shielded American sugar cane and beet growers from cheap foreign sugar on the global market.

Louisiana’s congressional delegation, however, joined lawmakers from other sugar-producing states to defend the programs as essential safeguards against a potential wave of cut-rate and subsidized foreign imports that could wipe out the entire domestic industry.

All six Louisiana House members — five Republicans and one Democrat — came out in strong support of the sugar subsidies.

Rep. Virginia Foxx, a North Carolina Republican, had led an effort to blow up the sugar subsidies, decrying it as “Soviet-style policy.” Critics have contended inflated sugar prices have caused U.S. candy factories to close in the face of foreign competition and resulted in higher food prices at the grocery store.

Republican Reps. Ralph Abraham of Alto, Garret Graves of Baton Rouge, Clay Higgins of Port Barre and Mike Johnson of Bossier all said they might turn on the farm bill if changes were made to the sugar program. Majority Whip Steve Scalise, R-Metairie, whose district includes southern Terrebonne and Lafourche parishes, worked to kill Foxx’s amendment.

“I think it would so undermine American farmers and undermine our food security that I would likely vote against the bill,” said Graves, whose district includes northern Terrebonne and Lafourche.

Foxx claimed earlier this week to have enough votes to pass an amendment to scrap the domestic production caps, ease imports and kill a federally supported sugar-ethanol program. But Foxx’s proposal — which was backed by candy makers, soft drink companies and other bulk buyers of sugar — turned out flat, going down 278 to 137.

Sugar cane growers in Louisiana, which produces roughly a fifth of the nation’s sugar crop, were alarmed by Foxx’s amendment. Farmers and trade groups said it would allow foreign producers to dump sugar on the U.S. market at prices well below the cost of production.

“If we had to compete with that, there’s no way we could sustain our industry,” said Gary Gravois, a third-generation sugar cane grower who currently farms about 1,700 acres near Napoleonville.

Gravois, along with Louisiana Republicans and others in the sugar industry, argued that American sugar growers could compete on an even footing with farmers in Mexico, Guatemala and other foreign markets. But they contended extensive subsidies abroad would leave American producers vulnerable without the supports.

“If it were free market globally, we could have a different discussion,” said Abraham, Louisiana’s sole member of the Agriculture Committee and a farmer himself. “So many other countries subsidize their farmers so much that it’s not a level playing field.”

Ending protections for sugar growers “would eventually lead to the dismantling of Louisiana’s 220-year-old sugar industry,” said Jim Simon, general manager of the Thibodaux-based American Sugar Cane League, a trade group for Louisiana producers. “We’re going to be run out of business.”

Backers of the subsidies note that the system of sugar price supports rarely directly costs the federal government money. Unlike federal subsidies for other crops — where U.S. taxpayers send checks to growers of corn, soy and other commodities — the sugar programs generally prop up prices by restricting supply.

“We’ve got to support sugar in Louisiana, it’s such a big part of our economy,” said Johnson, whose northwest Louisiana congressional district includes many farmer. “It’s not perfect but I’m a realist. (Farm subsidies) are one of those things that, as a conservative, we wrestle with every day.”

According to the industry, south Louisiana is home to about 450 sugar cane farms and another 11 mills, producing an annual harvest worth more than $1 billion and employing — directly or indirectly — some 16,000 people. For Louisiana politicians, that economic importance may be reason alone to protect sugar producers.

“I support the sugar industry. Period. End of discussion,” said Sen. John Kennedy, R-La. “It’s hugely important to America, it’s hugely important to my state and I’m not going to do anything to hurt it.