Halloween is all about sugar. If you’re a kid, you trick-or-treat for it, and clever adults look forward to Nov. 1 when the Halloween-themed candy goes on sale.
But wherever you get your Halloween candy fix from, the real winner of the holiday is big sugar producers, artificially enriched by federal programs at taxpayer expense and reaping the benefits of high domestic prices.
For an idea of just how big of a deal this is, 95 percent of the expected $9 billion spent by Americans on Halloween in 2018 will go to purchasing candy according to the National Retail Federation.
Cashing in on the core ingredient of that candy, sugar, is understandably a big deal. Sugar producers have figured out how to partner with the government to get you to pay more for it.
For the handful of sugarcane and sugar-beet farmers and processors, that system has worked really, really well. For everyone else, not so much.
How the whole thing works is actually pretty scary.
With an army of lobbyists, these companies ensure that the current scheme of price supports, protectionism, and federal policies that privilege big sugar producers remain in place year after year.
Between protectionist quotas that keep prices artificially high and a government-supported industry-planning board that sets the price for sugar and limits company output, the free market has little room to operate.
Moreover, lobbyists have also secured government-backed loans and mandates for the government to buy up sugar if prices fall, meaning that the government is not only shielding the business but also propping it up. All of that comes at the expense of industries making sugar-containing products, their employees, and the taxpayers who pay more for sugar while, at the same time, subsidizing the companies that produce it.
In the end, the benefit of this relationship between Big Sugar and Big Government helps the handful of largest sugar-producing companies. For smaller companies, Big Sugar has based production limits on past output, meaning that the largest market share remains concentrated in the biggest players.
As for jobs, a fond talking point of the sugar lobby, there are roughly 18,000 workers who process sugar and 4,500 in the farming business that actually produces it. That’s a drop in the bucket compared to the 600,000 jobs in the industries that use sugar as an input. Those sugar users, due to the high cost of American sugar, are increasingly relocating abroad.
So, when you're doing a little last-minute holiday candy shopping and wondering why the prices for your favorite treat are so high, a good bit of the answer has to do with big sugar cronyism.
Indeed, in the United States, sugar costs almost twice as much as elsewhere, not to mention the taxpayer-funded benefits afforded to the companies and the loss of competition.
In short, the government has picked big sugar companies as the winner and you, your trick-or-treating kids, and every taxpayer in the U.S. as losers.
That’s textbook cronyism with all of its creepiness — and there's nothing sweet about it.