Ask any Republican or any conservative about free trade and one simple answer will be given. It is an absolute article of faith for conservatives and Republicans that we must have free trade.
But there is a catch. Free trade really means free trade. Free trade does not mean thatother countries are free to subsidize their nation’s exports to America while we unilaterally disarm. Sugar is a great example of this.
The United States is one of the only major sugar producing countries that doesn’t send domestic producers subsidy checks. It’s also one of the only major sugar producing countries that accepts imports.
Brazil, Thailand, Australia, India, Guatemala, The European Union, Mexico, Columbia and even the United Arab Emirates are sugar exporters. And what do they all have in common?
Those nations (or in the case of the EU, group of nations) all subsidize their sugar industries with lavish checks and other market-distorting policies.
Meanwhile, American sugar producers receive government-backed loans that are paid back with interest. That’s why the policy operates without taxpayer cost.
In economic terms, foreign subsidies allow for what is called predatory pricing. In other words, a seller can price their product so low that a competitor, such as American sugar producers, cannot compete and eventually go out of business.
Sugar is an important product for rural communities across the country and for our food supply. Not only is it used in numerous food products, but it is also used to slow the setting of cement and glues. It is used to make some detergents, as well as in some pharmaceuticals, and is even used to help heal some wounds.
Almost eighty years ago, America entered the Second World War. When America entered that war, many resources were cut off from America. Then America was largely dependent on imported sugar and sugar became the first item that was rationed during World War II.
Should there be another large regional war, or other disruption, America could be looking at the same problem again. And not all disruptions are caused by acts of war. Some happen due to unfair trade practices.
In 2015, the U.S. International Trade Commission ruled unanimously that Mexico had harmed American sugar producers by breaking U.S. trade law and dumping subsidized sugar in American markets. As a result, U.S. farmers lost billions and producers in Hawaii stopped growing sugar altogether.
President Trump has rightly stood up for American workers threatened by unfair trade subsidies and he should continue to stand up for the country’s sugar industry by targeting foreign subsidies and ensuring America does not unilaterally disarm its farm policies.
Mr. President, make America’s sugar producers great again!