When “winning” means “losing”… bigly

There is absolutely, positively no upside to the US sugar policy unless you are a member of the favored sugar cartels. They have managed to use the power of the state to legally steal from you and enrich themselves. Trump is just upping the ante.

The Trump Administration last week announced a new agreement with Mexico to guarantee that sugar prices in both countries will remain well above the world market price. Commerce Secretary Wilbur Ross framed the deal as a big win—and it is, for the few sugar producers on both sides of the border. The losers are millions of consumers.

No industry has enjoyed as much protection under the North American Free Trade Agreement (Nafta) as sugar producers and refiners. Mexico raised its sugar import tariffs from third countries in 1994 to match U.S. protection levels and thereby form a customs union. While most of the U.S. economy had to adapt to competition from Canada and Mexico starting in 1994, the U.S. market remained heavily protected from Mexican sugar until 2008.

Even when the market opened, U.S. sugar interests refused to adapt and filed antidumping and countervailing duty suits against Mexican exports. In 2014 the Commerce Department ruled in their favor. Mexico could have fought that ruling at a Nafta arbitration panel but its sugar lobby also likes high prices. So instead it agreed to comply with a U.S.-stipulated minimum price and quota, and to restrict the amount of refined sugar it ships. In other words, both sides conspired to run a sugar cartel.

If you think that “America First” means using the power of a crypto-socialist, administrative state to enrich powerful business cartels at your expense, then you should be happy with Trump’s trade policy.

More at the WSJ.

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One Response to When “winning” means “losing”… bigly

  1. fasttimes says:

    BIG LEAGUE, not bigly, nobody talks like that.