Nowhere is there a larger gap between the U.S. government'sfree-trade rhetoric and its protectionist practices than in thesugar program. Through preferential loan agreements and tariff-ratequotas, the U.S. government thwarts price competition to maintainan artificially high domestic price for sugar--a price that can betwice the world market price or higher.
America's sugar quotas pose a threat to multilateral andregional trade negotiations. U.S. trading partners routinely andrightly point to quotas as being inconsistent with U.S. demands formore open markets abroad. The sugar program has become an obstacleto lowering foreign trade barriers to U.S. exports.
The U.S. sugar program is a classic case of concentratedbenefits and dispersed costs: a very small number of sugar growersreceive enormous benefits, while the costs of providing thosebenefits are spread across the U.S. economy, specifically toconsumers and confectioners. Repealing the sugar quota program willrequire more vigorous leadership from the president and the manymembers of Congress who represent far more people who suffer fromthe U.S. sugar program than who benefit.