When I first joined the sugar industry in 2004, reporters, politicians and others thought leaders were legitimately interested in international issues—namely the Central America Free Trade Agreement (CAFTA) and possible pacts with Brazil, Thailand and others.
Trade was seen a top priority of the business community, the administration and the editorial pages of most major newspapers. But the notion of “fair trade” was likewise gaining momentum.
As such, America had a fierce and open public debate that pitted the merits of more open trade against the unintended consequences of outsourcing U.S. manufacturing to countries with lower environmental, safety and labor standards.
By the conclusion of that debate, CAFTA had turned into a bruising political battle with pitfalls for lawmakers on both sides of the argument.
Shortly after its narrow passage, the U.S. economy stalled and the dynamics surrounding the trade conversation completely changed.
With little political upside to pushing additional difficult-to-pass trade deals, and with bigger problems at home, attention quickly shifted from global commerce to domestic policies that could pull America from the grips of a recession.
Today things could be changing once again.
The economy is back on track, the stock market is flying high, U.S. manufacturing has somewhat rebounded, and talks in Congress are turning to an alphabet soup of trade issues like TPP, TTIP, TPA and Cuba. In fact, trade is widely viewed as one of the few issues that can actually bring Republicans and Democrats together.
While I will not spend this column debating the merits of these specific trade measures or the risks they present for sugar (that’s a discussion for another day), I will point out that the renewed interest in international affairs gives the sugar industry a unique messaging opportunity.
Specifically, sugar producers will find more sympathetic ears today when discussing foreign subsidization and the grossly distorted dump market, where prices hover well below average costs of production.
Take for example the “Zero-for-Zero” sugar policy introduced in 2013 by Rep. Ted Yoho, R-Fla. This resolution, which was reintroduced in late February, shines a light on sugar subsidies in Brazil, India, Thailand and Mexico.
Yoho’s plan is to bring about a true free market for sugar by targeting foreign subsidies then rolling back U.S. policy so that the best businesspeople—not the most subsidized—are rewarded.
The American Sugar Alliance has backed the plan, recognizing that America’s sugar industry is comprised of efficient producers who can succeed in a true free market.
And U.S. sugar producers have found some very unlikely allies in championing the Zero-for-Zero approach.
Conservative commentators and think tanks, most of which have been outspoken critics of U.S. sugar policy, have likewise endorsed Yoho’s resolution. In fact, more than 10,000 conservatives from across the country wrote their members of Congress late last year urging its passage.
Momentum should continue to build, too, as foreign sugar producers supply us with more and more subsidy ammunition. India, for example, has passed direct export subsidies that seem to be in clear violation on World Trade Organization rules.
Ironically, Thailand and Brazil are crying foul even as they are upping their own subsidies, including preferential loans, debt forgiveness, input subsidies and new ethanol blending mandates. India and others are, in turn, attacking these subsidies creating the equivalent of a circular firing squad where America’s biggest global competitors will tear each other apart.
The debate over foreign subsidies is extending beyond sugar too, which lends even more credence to ASA’s messaging efforts.
A delegation of grain and rice leaders recently briefed U.S. trade officials on a foreign subsidy report their industries commissioned.
That report, written by DTB Associates, found that Brazil, China, India, Turkey and Thailand have steadily increased agricultural subsidies to the point of being out of compliance with their WTO obligations.
Whether the DTB report or the Zero-for-Zero resolution will actually lead to reform remains to be unseen. But what we do know is that the conversation has begun, and U.S. sugar producers will be much better off if they help shape that discussion along the way.
Editor’s note: Hayes is the director or media relations for the American Sugar Alliance. Email him at phillip@sugaralliance.org.