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WASHINGTON -- The federal sugar support program easily survived
an attack Thursday in the Senate.
Sen. John McCain, R-Ariz, asked the Senate to kill all funding
for the program. The Senate tabled McCain’s amendment, by a vote
of 62-35, which in effect kills it.
McCain said the government program is a subsidy for rich
corporate farmers and drives up the price of sugar for U.S.
consumers.
U.S. Sen. John Breaux, D-La., led the sugar-state defense of the
program. He was joined by senators from corn and sugar beet states.
The sugar program involves government-backed loans and a trade
initiative that imposes fees on sugar imports and limits the amount
of foreign sugar that can enter the United States.
Ordinarily, the combined elements of the program mean the
government does not have to take ownership of the sugar that’s
pledged as collateral for the loans.
This means there’s little direct taxpayer subsidy, and the cost
of the sugar price-support program is borne by consumers who buy
sugar or products containing sugar.
However, this year a combination of a U.S. sugar surplus and low
prices have forced the government into a sugar buy-back from the
domestic industry. McCain and other opponents have not been able to
translate that development into congressional action to kill the
price-support program.
Breaux and his sugar-state allies said the federal program has
stabilized the price and supply of sugar in the United States.
They also said the program is needed to protect U.S. sugar
farmers who compete against heavily subsidized European growers.
U.S. Sen. Kent Conrad, D-N.D., said European governments hope to
gain market dominance before international trade pacts impose more
curbs on government farm supports. He said the United States
"should not unilaterally disarm" during a trade war.
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