Candy companies gain ground in war with sugar producers over subsidies

America’s sugar producers are feeling the heat after the House narrowly defeated an attempt to scale back subsidies, price supports and quotas that benefit their industry.

The vote last week came just a few hours before a five-year farm bill went down in flames on the House floor. By a surprisingly narrow 206-221 vote, lawmakers rejected an amendment from Reps. Joe Pitts (R-Pa.), Danny Davis (D-Ill.), Bob Goodlatte (R-Va.) and Earl Blumenauer (D-Ore.) to change the sugar program.

{mosads}That was a dramatic swing from 2007, when the Democratic-controlled House voted down a similar amendment in a resounding 144-282 vote.

The sugar industry also had a close call in the Senate, where an amendment to change the programs was defeated earlier this year in a 54-45 vote.

Sugar growers say “a win is a win,” but when pressed, acknowledge opponents are making gains in their quest to scale back the federal system.

“Sweetener users spent $8 million on lobbying. That may sound glib, but they have ramped up their efforts,” said Phillip Hayes, spokesman for the American Sugar Alliance. “Users like Kraft have had record profits, and they’re using a chunk to greatly ratchet up lobbying.”

The battle over the sugar programs has raged for years. Candy companies and allies like the Chamber of Commerce argue the federal supports for sugar distort the market and drive up prices, and have lobbied aggressively to reduce them.

Sugar producers reject that argument and say their industry would cease to exist without federal aid that helps them compete against foreign competitors who are heavily subsidized by their own governments. They say the cost to taxpayers is zero or very small compared to jobs saved.

Hayes said his coalition was outspent in the last round of fighting by the Coalition for Sugar Reform. He cited Opensecrets.org data that shows organizations supporting the sugar changes spent $135 million on lobbying in 2012, compared with $93 million in 2008. Lobbying on sugar is part of those totals, but a specific breakdown is not available.

“They did a better job of mobilizing their base,” Hayes said. 

The Coalition for Sugar Reform dismissed the lobbying comparison and noted the sugar industry has its own formidable lobbying force in Washington. 

“The folks that lobby for them, they solely focused on protecting the sugar program. Those opposed to the sugar program spend a lot of lobbying dollars on other things,” said Jennifer Cummings, a spokeswoman for the coalition. “It is misleading to suggest that they were outspent. Comparing budgets, it is really an apples to oranges comparison.”

What’s clear is that the opponents of the sugar system are closer than ever to mustering the majorities they need to triumph in Congress.

In the latest House vote, liberals like Reps. Jan Schakowsky (D-Ill.), Chris Van Hollen (D-Md.), Mel Watt (D-N.C.), Chaka Fattah (D-Pa.) and Nita Lowey (D-N.Y.) flipped in support of the sugar changes.

An aide to Van Hollen said the “arguments on the consumer side of the equation have grown stronger over time.”

Van Hollen and the other liberal lawmakers are allies of Minority Leader Nancy Pelosi (D-Calif.), and might have felt pressure to vote against sugar changes in order to pass the farm bill when Pelosi was Speaker.   

Hayes said that opponents of the sugar programs had been spreading “misinformation” on prices, especially in urban districts where members are most concerned about constituent grocery bills. Since 2012, sugar prices have plummeted, and that is left out of the sales pitch, he said. 

“I can tell you there is a tremendous amount of misinformation going to those offices,” Hayes said.   

Cummings said members of the reform coalition are clear when meeting with members that sugar prices have dropped since 2010. She said the coalition didn’t target urban offices specifically but did argue that the sugar program is making groceries more expensive. 

“Our strategy has always been a full-court press,” Cummings said. “We are all consumers at the end of the day.”

The sweetener-user coalition also emphasized that low sugar prices still come at a cost because the government is forced to buy up excess sugar and sell it at a loss to ethanol producers. That action, required under the Feedstock Flexibility Program, would have been repealed by the Pitts amendment.

The Agriculture Department announced just before last week’s vote that it would spend $38 million to buy up excess sugar. Cummings said the news resonated with members, especially on the conservative side of the aisle, where many oppose the sugar system as corporate welfare.

An analysis by The Hill of the newest votes shows that the largest increase for the sugar change comes from Tea Party members elected in 2010. Tea Party Caucus head Rep. Michele Bachmann (R-Minn.), who is not running for reelection, voted with her state’s sugar farmers in 2007 but against the sugar program this time. 

Neither sugar growers nor their opponents know how the farm bill fight is going to wrap up or whether their bitter feud will break out into open warfare again this year. 

At present, Agriculture Committee Chairman Frank Lucas (R-Okla.) and ranking member Collin Peterson (D-Minn.) are weighing their options after the farm bill was defeated on the House floor 195-234. 

The central problem with the bill was that food stamp changes were too much for liberal Democrats and not enough for the most conservative Republicans.