America’s founders understood this law of politics: The governing class advances policies that benefit the wealthy and well connected. As George Will notes, “The world is divided between those who do and do not understand that activist, interventionist, regulating, subsidizing government is generally a servant of the strong and entrenched against the weak and aspiring.” Sugar subsidies are an especially poignant example.

U.S. Department of Agriculture studies showed the benefit of government programs to various commodity producers. For example: $23 per acre for wheat, $87 per acre for cotton, and a whopping $472 per acre for sugar -- and that’s only one year. These supports produce negative environmental, economic, and political consequences.

Here is a fundamental rule of economics: subsidies encourage overproduction. Because the government inflates the domestic market price for sugar, Florida farmers are encouraged to divert water from the Everglades, damaging America’s famous “river of grass.” The perverse incentives of inflated crop prices move marginal land into production.

Testifying before the Senate Agricultural Committee on the U.S. sugar program, Representative Dan Miller (R-FL) noted, “The subsidized production of sugar in Florida results in phosphorous-laden run-off flowing into the Everglades, which contributes to the destruction of this fragile ecosystem. Amazingly, the Federal Government continues to subsidize sugar producers, even as Congress participates in multi-billion dollar projects to repair the damage done to the Everglades.” Such detrimental subsidies are commonplace among western nations.

As Will reminds us, the political process concentrates benefits while dispersing costs. American consumers pay two to three times the world market price for sugar. The World Bank reports that, annually, U.S. sugar subsidies transfer about $1.3 billion from consumers to sugar producers. And they, in turn, are campaign contributors.

The number of individuals benefiting from generous subsidies is decreasing as large sugar growers replace small farmers. It is not surprising that these growers give generously to U.S. political parties. The Fanjul family, owners of Flo-Sun, America’s largest sugar producer, spent nearly $1 million in soft money for the 2000 elections. Donations were split almost evenly between Republicans and Democrats to ensure the continuation of subsidies regardless of the outcome of the election. Sugar producers as a whole contributed $22 million to federal candidates for the 2004 election.

I’m inspired by the Archies’ song from more than 15 years before I was born:

We’ll pour a little sugar on you honey

We’ll pour even more with some money

We can make your life so sweet

For our subsidies are hard to beat

Because sugar is in many consumer products, e.g., whole-grain bread, cereal, fruit preserves, soda and candy, nearly everyone bears the cost of these subsidies. While the sugar barons benefit, low-income families suffer most, since a larger percentage of their income is allotted to food. The U.S. Department of Commerce asserts that “the effect of the sugar program is similar to a regressive sales tax, which hits lower-income families harder than upper income families.” The majority of Americans support environmental protection and lower food prices. But these two objectives conflict with Big Sugar’s interests.

U.S. sugar policy undermines America’s role as a leader of, and advocate for, free trade. It is hypocritical for the U.S. to demand that other countries pursue liberal trade policies, while it is guilty of sweet protectionism. Developing countries know the U.S. sugar program decreases the profits of their farmers and forces them out of sectors of the global economy in which they can compete. Is this just?

The U.S. sugar program was created in the policy chaos of the New Deal. Midway through the Depression, it was thought such subsidies would save family farms. Today, sugar production is carried out primarily by large firms, most of which ignore the negative environmental consequences of their practices. If abolished, the domestic price of sugar, as well as the price of all foods containing sugar, would decrease; pollution and water deprivation of the Everglades would decrease; and Third World farmers could compete.

Despite these benefits, eliminating government support of Big Sugar is a challenge. The wealthy and well educated have the experience and access required to maintain their preferential policies. Politicians have a sweet tooth for donors, and the poor, as usual, lose out.