convsugar

Sweet Cornageddon

The modern farm lobby has many similarities with the Republican Party like denying climate change and calling for the repeal of Obamacare in policy books. Until today, DC based ag lobbyists have largely adhered to a peace accord similar to the GOP 11th Amendment axiom made famous by Ronald Reagan to not attack other members in the industrial farm family.

So pass the popcorn because the Corn Refiner’s Association just launched a massive attack on the U.S. sugar industry’s federal support. The Washington Post’s Tom Hamburger and James Hohmann have the exclusive yesterday morning on CRA’s surprise offensive:

For decades, it’s been an unspoken rule among Washington’s agricultural lobbyists: advocates for one crop do not attack other crops, so that everyone’s benefits can be protected.

But a leading member of the traditionally united community plans to do just that: the Corn Refiners Association is about to invest heavily in an effort to unwind the lucrative breaks afforded to sugar, which are among the most generous in U.S. agriculture.

The Corn Refiners, representing companies that produce high-fructose corn syrup, just hired 10 outside lobbyists for an aggressive, unorthodox attack on the federal sugar program just a year after a new farm bill was signed into law. Their first target is the agriculture appropriations bill, now moving through a House committee.

It’s clear that Corn Juice’s declaration of war is over sweetener sector market share. Consumer concerns with the health impact of products like high fructose corn syrup have lead to an erosion of sales for some of America’s biggest food companies like Archer Daniels Midland.

The melee has mostly been confined to behind the scenes skirmishes. The New York Times reported in February of 2014 on the millions poured into covert PR campaigns on both sides. Then in early 2015 corn drew blood over sugar when they forced sugar’s lawyers off a lawsuit on the use of the word “natural” between the two caloric commodities.

What’s most dangerous for the agriculture sector – aside from puncturing the veneer of civility between farm lobbyists – is the conservative activist allies Big Corn is now rallying to their side in the fight against sugar. From the WaPo story:

…some on the right suggesting the attack on sugar could become a litmus test for conservative candidates going forward, much as the Export-Import Bank has been in the first half of this year.

“Defeating the sugar lobby is the next campaign after Ex-Im,” Grover Norquist of Americans for Tax Reform said late Tuesday night. “Both are cronyism in its undiluted, inexcusable majesty. Both have survived because they perfected the skills to control Congress for their own profit. If they go down, no political subsidy will be safe. The implication of these wins is bigger than the ban on earmarks.”

I predict this shortsighted campaign by the corn refiners will only return misery to government dependent corn farmers. What will conservative activists do once they’ve dismantled the sugar program? Ignore other subsidies for other farmers? Fat chance. Norquist couldn’t be clearer about the precedent it would set saying, “If they go down, no political subsidy will be safe.”

Over at rightwing blog Hot Air, Jazz Shaw articulates exactly the danger for all farmers that rely on the government when their lobbyists activate unguided missiles:

The new legislation mentioned in the WaPo article is going to turn into a bone of contention on the campaign trail, and conservatives will be forced to take a stand on corporate welfare and subsidies in general.

Subsidies in general, like crop insurance. So when conservative activists suddenly turn from sugar to corn, no one should be surprised, and everyone will know who to point the cob at.

*Update 6-30: The reaction from some big names in the subsidized agriculture community has not been kind to the corn refiners.

Former House Agriculture Chairman and  longtime industrial agriculture standard bearer Larry Combest (R-TX) blasted the move. In an op-ed in the Hill, he writes, “What a dangerously shortsighted strategy.”

Another former House Agriculture Chairman and now ranking member Collin Peterson (D-MN) trashed the corn refiner’s play in the Minneapolis Star Tribune. Peterson is widely known as the corn industry’s biggest ally in Washington DC. Apparently there is not much unity or advance warning in King Corn’s court for the move. “I’ve talked to the corn farmers. They didn’t know about this,” he said. 

Some stray kernels:

–       The last time farm lobby infighting spilled into the public was when livestock groups attacked corn ethanol mandates under the Renewable Fuels Standard because they drove up feed prices. King Corn is likely still sore from that assault and understandably figures civility is an unrequited virtue in this case.

–       Some see danger for Rubio and Bush due to expected fealty to Florida sugar. It could also push both of them to vocally support sugar and the corn ethanol mandate (maybe even part of the strategy?). There’s plenty of evidence supporting voters ultimately don’t care about candidates supporting farm programs. Why not take a ding from activists and move on?

–       The sense in the story and the misleading message from corn refiners is that their subsidies are reformed and way down while sugar’s are unscathed. It’s true that the sugar program is a lucrative giveaway to large corporate sugar interests and needs reform. But their support is more based on price control than checks from the treasury. Last year USDA spent $53 million on the program. From 95-2012 USDA subsidized corn by a staggering $84.4 billion and $18.5 billion in crop insurance.

–       It’s also true that other subsidies were “reformed” in the last farm bill, if by reform you consider swapping one subsidy, direct payments, for enhanced and essentially secret crop insurance subsidies that are projected by CBO to rack up a total cost $78 billion by 2023. Corn is by far the largest beneficiary of crop insurance.

–       While direct payments were eliminated, two whole new subsidy programs were created, Agriculture Risk Coverage and Price Loss Coverage. They will pay up to $7 billion annually over the next few years, “surpassing what they would have received through the old system of direct payments” and “corn growers will receive the lion’s share of payments,” next year.

–       One conservative group finds siding with subsidized corn repellent, saying, “We’re not real interested in climbing in bed with the corn lobby to accuse the sugar industry of being prostitutes”

–       Lobbyists complaining about who lobbies better is a big reason why people hate Washington DC.

Don Carr

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