Historically, the Miami Herald has been unenthusiastic about helping readers understand the corruption inherent in the U.S. Farm Bill through the sugar subsidy. The reason is clear enough: the influence of the Fanjul billionaires as expressed through downtown law firms, partners and their wealthy Cuban American clients who rub shoulders with Miami Herald publishers and top editors.
There are a few sacred cows in Miami that the Miami Herald will only criticize through Jim Morin's (excellent) cartoons or Carl Hiaasen's (occasional) OPED's. Reporting? Investigations? Not so much.
One has to go back to Martha Musgrove, former (intrepid) editorial writer, for a Miami Herald presence on issues related to Big Sugar, but even in Musgrove's time there was scant coverage of the harm Big Sugar did to Miami. (A former top editor of the Herald during these years, Joanna Wragg, went to work for Big Sugar as a public relations specialist after retiring from the newspaper.)
For example, the Herald scarcely published on the ascent of Marco Rubio to the US Senate thanks to the major political support from the Fanjuls, infuriated by Charlie Crist's attempt to purchase critical lands in the Everglades Agricultural Area owned by its competitor, US Sugar, or -- for that matter -- any of the chess moves by the Fanjuls to maintain their domination of the Everglades Agricultural Area at the expense of the Everglades.
The cozy relationship between sugar barons and the Miami Herald meant that news about Big Sugar, including the Fanjul's oppressive working conditions in the Dominican Republic, would have to be disclosed by other non-traditional media, like Al Jazeera's recent excellent report on the Fanjuls, noted by EOM this week.
As a historical matter, Big Sugar provided business opportunities for local influential Cuban Americans like Jorge Mas Canosa, whose first business included selling farm equipment in the Everglades Agricultural Area.
For many years, the bitter animosity between Mas Canosa and hard liners toward the Herald colored the newspaper's coverage of any possible detente between the US government and the Castro regime. That is quickly fading, overtaken by events, but one of the legacies is that Cuban Americans remain paradoxically protective of the sugar industry; billionaires industry who have done so little for them in Florida.
Interesting, too, that the sugar industry -- under intense civic attack in Martin and Palm Beach Counties because of filthy water discharged from Lake Okeechobee -- is responding with full page ads in papers but sees no need to do so in South Florida. The reason: the Miami Herald is indifferent to highlighting these facts for readers.
It is hard to know what is in the minds of Miami Herald publishers who feel no need to explain their business model as expressed through news coverage and choices. As Miami and South Florida urbanized, one of the collateral effects was to lessen the connections to an understanding by Herald readership how Big Sugar's command of fresh water resources -- including the domination of the Everglades by mismanagement of water infrastructure -- penalized people at the expense of crony capitalists. The Fanjuls sit atop the economic order, manipulating state and federal farm policy, like despotic royalty, but find a Miami Herald report to say so.
Here is a Wall Street Journal OPED that mostly takes the position that Big Sugar's subsidy should be eliminated because it costs Americans billions of dollars a year in artificially high food prices. You can also read the Al Jazeera report on the Fanjul billionaires, by clicking here.
The bottom line: Big Sugar poisons people, poisons democracy, and poisons the Everglades.
Wall Street Journal: The Sugar Scandal
Congress takes a run at an egregious business welfare scheme.
July 29, 2015 7:22 p.m. ET
Americans pay nearly twice as much per pound as foreigners do for sugar, thanks to U.S. import restrictions and subsidies. We’ve tilted at this corporate welfare for decades, but new political forces are aligning to take another run.
The absurdity of the federal sugar program is legendary. Every year the government grants sugar processors nonrecourse loans linked to the amount of sugar the government says they can produce at a set price per pound: 18.75 cents for raw cane sugar and 24.09 cents for refined beet sugar. If the market price is below the loan price when it’s time to sell, the processors simply forfeit their crop to the U.S. Department of Agriculture in lieu of repaying the loan. They can still make a profit thanks to the price guaranteed by the loan.
To ensure that imported sugar doesn’t drive down U.S. prices, provoking a sugar dump on Uncle Sam, there are also import quotas. Anything above the quotas gets hit with a hefty tariff—16 cents a pound on refined sugar.
Yet all of this central planning is harder than it sounds. According to a January 2014 USDA report, for the 2013 crop year the government’s net cost “to remove” sugar from the marketplace was $258 million. But sometimes there’s not enough sugar, as in 2010, and prices skyrocket. If the secretary of agriculture decides that shortages will drive prices too high, he can increase the quota. But he has to make sure that more imports won’t mean lower prices and thus sugar forfeitures to the feds. All the risk lies with consumers or taxpayers—not producers.
The Congressional Budget Office estimates that the loan program will cost some $115 million over the next 10 years. But the greater cost is to the economy. The food and drink industry, which has sales of some $387 billion, is less competitive when it has to pay twice the world price for sugar. In a July 2 letter to U.S. Trade Representative Michael Froman, the Coalition for Sugar Reform estimated the program has cost American consumers and businesses $15 billion since 2008 and 120,000 jobs since 1997.
The relatively few sugar cane and beet producers have grown fat and happy off this racket, but they are losing support. Growers of other crops had their subsidies cut in the last farm bill, and many are asking why sugar gets a pass. Last month the Corn Refiners Association, which produces high-fructose corn syrup, began lobbying on Capitol Hill for a level playing field with sugar.
They’re allied with Republican tea party Members of Congress who dislike business subsidies, led by Joseph Pitts (R., Pa.). In 2013 he led a floor revolt with an amendment to the farm bill that would have permitted more foreign sugar to enter the U.S. and reduced the price guaranteed by the federal loan. He lost 221 to 206.
Mr. Pitts is now seeking another opportunity for a vote to limit the size of the nonrecourse loan to any single sugar processor, and we hope he gets it. This wouldn’t end all of the political help that guarantees profits for sugar producers. But it would be a start, and a sign that American democracy isn’t so calcified by special interests that it can’t reform one of Washington’s worst welfare schemes.
There are a few sacred cows in Miami that the Miami Herald will only criticize through Jim Morin's (excellent) cartoons or Carl Hiaasen's (occasional) OPED's. Reporting? Investigations? Not so much.
One has to go back to Martha Musgrove, former (intrepid) editorial writer, for a Miami Herald presence on issues related to Big Sugar, but even in Musgrove's time there was scant coverage of the harm Big Sugar did to Miami. (A former top editor of the Herald during these years, Joanna Wragg, went to work for Big Sugar as a public relations specialist after retiring from the newspaper.)
For example, the Herald scarcely published on the ascent of Marco Rubio to the US Senate thanks to the major political support from the Fanjuls, infuriated by Charlie Crist's attempt to purchase critical lands in the Everglades Agricultural Area owned by its competitor, US Sugar, or -- for that matter -- any of the chess moves by the Fanjuls to maintain their domination of the Everglades Agricultural Area at the expense of the Everglades.
The cozy relationship between sugar barons and the Miami Herald meant that news about Big Sugar, including the Fanjul's oppressive working conditions in the Dominican Republic, would have to be disclosed by other non-traditional media, like Al Jazeera's recent excellent report on the Fanjuls, noted by EOM this week.
As a historical matter, Big Sugar provided business opportunities for local influential Cuban Americans like Jorge Mas Canosa, whose first business included selling farm equipment in the Everglades Agricultural Area.
For many years, the bitter animosity between Mas Canosa and hard liners toward the Herald colored the newspaper's coverage of any possible detente between the US government and the Castro regime. That is quickly fading, overtaken by events, but one of the legacies is that Cuban Americans remain paradoxically protective of the sugar industry; billionaires industry who have done so little for them in Florida.
Interesting, too, that the sugar industry -- under intense civic attack in Martin and Palm Beach Counties because of filthy water discharged from Lake Okeechobee -- is responding with full page ads in papers but sees no need to do so in South Florida. The reason: the Miami Herald is indifferent to highlighting these facts for readers.
It is hard to know what is in the minds of Miami Herald publishers who feel no need to explain their business model as expressed through news coverage and choices. As Miami and South Florida urbanized, one of the collateral effects was to lessen the connections to an understanding by Herald readership how Big Sugar's command of fresh water resources -- including the domination of the Everglades by mismanagement of water infrastructure -- penalized people at the expense of crony capitalists. The Fanjuls sit atop the economic order, manipulating state and federal farm policy, like despotic royalty, but find a Miami Herald report to say so.
Here is a Wall Street Journal OPED that mostly takes the position that Big Sugar's subsidy should be eliminated because it costs Americans billions of dollars a year in artificially high food prices. You can also read the Al Jazeera report on the Fanjul billionaires, by clicking here.
The bottom line: Big Sugar poisons people, poisons democracy, and poisons the Everglades.
Wall Street Journal: The Sugar Scandal
Congress takes a run at an egregious business welfare scheme.
July 29, 2015 7:22 p.m. ET
Americans pay nearly twice as much per pound as foreigners do for sugar, thanks to U.S. import restrictions and subsidies. We’ve tilted at this corporate welfare for decades, but new political forces are aligning to take another run.
The absurdity of the federal sugar program is legendary. Every year the government grants sugar processors nonrecourse loans linked to the amount of sugar the government says they can produce at a set price per pound: 18.75 cents for raw cane sugar and 24.09 cents for refined beet sugar. If the market price is below the loan price when it’s time to sell, the processors simply forfeit their crop to the U.S. Department of Agriculture in lieu of repaying the loan. They can still make a profit thanks to the price guaranteed by the loan.
To ensure that imported sugar doesn’t drive down U.S. prices, provoking a sugar dump on Uncle Sam, there are also import quotas. Anything above the quotas gets hit with a hefty tariff—16 cents a pound on refined sugar.
Yet all of this central planning is harder than it sounds. According to a January 2014 USDA report, for the 2013 crop year the government’s net cost “to remove” sugar from the marketplace was $258 million. But sometimes there’s not enough sugar, as in 2010, and prices skyrocket. If the secretary of agriculture decides that shortages will drive prices too high, he can increase the quota. But he has to make sure that more imports won’t mean lower prices and thus sugar forfeitures to the feds. All the risk lies with consumers or taxpayers—not producers.
The Congressional Budget Office estimates that the loan program will cost some $115 million over the next 10 years. But the greater cost is to the economy. The food and drink industry, which has sales of some $387 billion, is less competitive when it has to pay twice the world price for sugar. In a July 2 letter to U.S. Trade Representative Michael Froman, the Coalition for Sugar Reform estimated the program has cost American consumers and businesses $15 billion since 2008 and 120,000 jobs since 1997.
The relatively few sugar cane and beet producers have grown fat and happy off this racket, but they are losing support. Growers of other crops had their subsidies cut in the last farm bill, and many are asking why sugar gets a pass. Last month the Corn Refiners Association, which produces high-fructose corn syrup, began lobbying on Capitol Hill for a level playing field with sugar.
They’re allied with Republican tea party Members of Congress who dislike business subsidies, led by Joseph Pitts (R., Pa.). In 2013 he led a floor revolt with an amendment to the farm bill that would have permitted more foreign sugar to enter the U.S. and reduced the price guaranteed by the federal loan. He lost 221 to 206.
Mr. Pitts is now seeking another opportunity for a vote to limit the size of the nonrecourse loan to any single sugar processor, and we hope he gets it. This wouldn’t end all of the political help that guarantees profits for sugar producers. But it would be a start, and a sign that American democracy isn’t so calcified by special interests that it can’t reform one of Washington’s worst welfare schemes.
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