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Yet their company, Florida Crystals, recently turned over more than 100,000 tons of raw sugar to the feds instead of repaying $37 million in government loans.

But for every Fanjul, there are hundreds of sugar growers like David Pauly of Great Bend, N.D.
Pauly farms about 82 acres of sugar beets, plus 1,500 acres of soybeans and corn. From early spring to late fall, he's in his fields from before dawn until after dusk, seven days a week.

This year, Pauly said, his net farm income will be exactly nothing. Luckily, the family will earn about $70,000 from a machine shop he runs in his spare time and the beauty parlor his wife operates. Last year, the farm lost $50,000, he said.

Perhaps it's no surprise that Pauly doesn't want to see his son, a junior in high school, take up the farmer's life.

"I hope he does something other than this," Pauly said recently. "My brother's a bank president. He works eight hours a day and screws off on weekends at his lake cabin."

In defending the U.S. government's system of price-support loans and import quotas for sugar, intended to guarantee that domestic farmers can sell sugar for a profit, sugar producers inevitably cite the need to protect small family farmers such as Pauly.

Their critics counter with families such as the Fanjuls.

In truth, the debate over whether farmers should receive government aid is more complicated.

Not-so-free market?

The basic reason for government intervention in farming is that agriculture is unlike any other business.

It's extremely volatile economically -- a year's work can be wiped out with a flood, an infestation or a hard freeze -- and it requires large investments with often modest returns.

Without some protections, small farmers say they likely would go bankrupt every time they had an off year.

To prevent that, the government historically has tried to stabilize the ups and downs by dictating how much of various crops can be planted, by setting minimum guaranteed prices, and by offering disaster payments and cash loans.

But in recent years, pressure on the U.S. government has mounted to let agriculture run a free-market course.

In part to respond to that pressure, Congress passed the Freedom to Farm Act in 1996, which, among other things, began to phase out guaranteed minimum prices on many crops, including wheat, rice and corn.

Since then, market prices for many staples have dipped precipitously. But until last year, sugar prices remained fairly steady, thanks to the feds' retention of import quotas and loans that can be paid back with crops instead of cash.

Predictably, more farmers have turned to cane and beets. That has led to sugar surpluses, which dropped the price of sugar by 30 percent.

Recently, the price has nudged up a bit, from a low of 17 cents to 21 cents per pound, but it seems unlikely the recovery will last if the record production continues.

In any event, the bounce came too late to stop sugar producers from turning over a million tons of sugar to the government instead of paying back loans. The loans are based on a certain price per pound, so when sugar dips, it's more profitable for farmers to keep the money and turn over the collateral: their crops.

And critics fear that even more sugar will be forfeited to the government next year.

"The federal government just can't be providing a billion-dollar-a-year subsidy to sugar producers," said U.S. Rep. Dan Miller, R-Fla., one of the sugar program's leading critics.

Sugar as political gold

Miller and others contend that the real reason the government continues to protect sugar is that the industry is a gold mine for political war chests. Since 1990, sugar interests have contributed more than $15 million to congressional candidates and political action groups, according to the Center for Responsive Politics, a nonpartisan group that tracks contributions.

"To me, the sugar lobby is a poster child of why we need campaign-finance reform," Miller said.

Sugar critics add that the federal government's program also undermines its attempts to negotiate freer trade agreements with other nations.

Most sugar farmers will tell you that they support true free trade. But without some protection from the federal government, they say, they'll lose out to their subsidized and underregulated competitors abroad.

"The only reason we need a program is to protect ourselves from these other countries that subsidize their growers," said Charlie Melancon of the American Sugar Cane League, based in Thibodaux. "We're not opposed to competing in a world market, as long as we're not competing against the other guys' governments."

Nonetheless, supporters of a free market say the end result of eliminating sugar subsidies would be a lower price for consumers and sugar users, and a better deal for taxpayers.

However, there's some dispute over whether consumers really would see much benefit from lower sugar prices. For instance, a pair of studies reported that sugar's recent price swoon has had little or no effect on the price Americans pay for refined sugar or sweetened products such as cereal and soda.

Moreover, many American growers argue they would be put out of business if the government allowed unrestricted importation of foreign sugar. That, in turn, would mean an increasing reliance on foreign sugar, which could drive up prices.

They point out that the price of sugar has remained stable for two decades with price-support loans in place. And when Congress last got rid of the sugar program, in 1974, the price of sugar shot up to 70 cents a pound, three and a half times the current price.

"It's important that Americans have their own safe and secure supply of food," said Charles Thibaut, general manager of the Evan Hall Cooperative in Donaldsonville. "Otherwise, you have the same situation you have with oil. You're at another country's mercy."