J. Wellington Wimpy was a famous cartoon character in the Popeye comics. Known as Wimpy, his most famous line was, “I will gladly pay you on Tuesday, for a hamburger today.”
Unfortunately, far too many policy makers want to follow Wimpy in making policy.
Most Republicans circle the wagons around free trade. Free trade is an article of faith to the GOP. Free trade, when it is really free, works great. Just look at the United States. The US is the most successful free trade zone in history. Goods and services easily flow from one state to another and everyone comes out ahead.
International trade is not nearly as easy.
In international trade, far too many countries either throw up barriers or worse, subsidize their products at the expense of Americans. One of the worst offenders are sugar producers.
Now some in the free trade movement want to dismantle American sugar protections. These protections help shield American sugar producers against unfair foreign subsidies. The argument is that if we dismantled our protections, the nations that subsidize their products would end their subsidies.
That is an illogical theory. But what would happen if it were actually tried out?
Turns out, we don’t have to speculate. Europe, following its strong tradition of unilateral surrender tried this very strategy. Thirteen years ago, Europe decided this would be a really good idea.
It is generally true that no bureaucrat should have the authority to decide anything more significant than what is for dinner. It is also generally true that if a bureaucrat takes a position, you can reflexively oppose it and almost certainly be right. European bureaucrats decided it would be a good idea to eliminate all protections for their sugar producers, without seeking any concessions from foreign sugar producers.
Since that time, 83 sugar mills have closed, and 120,000 sugar workers have lost their jobs. But the good news is, no bureaucrats were injured in the creation of this disaster.
But wait, like the old late night TV commercials, this gets better. Big industrial sugar producers were bailed out to the tune of $3.4 billion. Not only that, sugar farmers have gone from being profitable to needing $700 million a year in subsidies just to survive. Perhaps this is one of the few times, Europe is should have American ambulance chasing lawyers.
“Has your sugar business gone under because of European Bureaucrats and their policies. Call me. I sue for you!”
While Europe’s sugar industry was not wiped out by the bureaucrats, the game is not over yet. Industry experts expect ten to twenty sugar factories to close in the next five years, because of this bad policy.
Albert Einstein famously said, “Insanity is trying the same thing over and over again and expecting a different result.”
President Trump’s promise to Keep America Great extends to America’s sugar farmers too. Foreign subsidies distort the market and injure American farmers and the people who work for the American sugar industry.
Free trade works when trade is truly free. America should not abandon its protections for sugar producers until other nations agree that they will do the same.
It is called free trade, not unilateral surrender.
That is a message the Europeans should have learned a long time ago. It is a message America needs to pay attention to.