Stabilization of the Sugar Industry

Report Outline
Roosevelt Administratrator's Sugar Control Program
Condition of the Sugar Industry Since the War
Efforts to Limit Sugar Production and Raise Prices
Obstacles to Stabilization of the Sugar Industry
Special Focus

Roosevelt Administratrator's Sugar Control Program

A vigorous struggle in Congress over the administration's plan for control of domestic sugar production and sugar imports was forecast by the reception accorded the proposals outlined in President Roosevelt's special message of February 8, 1934, and the enabling legislation introduced in Senate and House four days later by Senator Costigan (D., Col.) and Rep. Jones (D., Tex.). The strength of the opposition manifested by representatives of the beet-sugar industry and by members of Congress from beet-producing states indicated that if concessions to their views were not made in committee, or by amendments on the floor, the measure would be defeated in spite of its administration sponsorship.

The new plan aims to improve sugar prices and stabilize the sugar industry by restricting domestic production and limiting imports in accordance with a quota system under which the United States sugar market would be apportioned among continental, insular, and Cuban producers. At the same time, consumers' interests would be safeguarded by a reduction in the sugar tariff, while domestic producers in turn would be compensated by bounty payments equivalent to the amount of tariff protection withdrawn. The Jones-Costigan bill, submitted as an amendment to the Agricultural Adjustment Act of May 12, 1933, proposes to accomplish these purposes by adding sugar cane and sugar beets to the list of agricultural commodities in respect of which processing taxes may be levied and benefit payments made. A special provision would limit the rate of the processing tax on sugar to the amount by which the President reduced the sugar tariff. The Secretary of Agriculture would be authorized to fix the quotas on the basis of past importations of Cuban and insular sugar and past marketings or production of domestic sugar.

The tentative quotas suggested by the President in his message to Congress were interpreted by those concerned with American beet-sugar production as unduly favoring Cuban at the expense of domestic interests. On the floor of the Senate and at hearings before the Senate and House committees, the fear was expressed that the plan as introduced constituted a threat to the future existence of the beet-sugar industry in the United States. Demands were consequently made that Congress write into the legislation provisions more narrowly restricting the quota-fixing powers to be extended to the Secretary of Agriculture.