The Congressional Budget Office is charged with providing Congress budget estimates for all government policies. Sugar policy is no different, and critics often...
The Congressional Budget Office is charged with providing Congress budget estimates for all government policies. Sugar policy is no different, and critics often like to point to these estimates - especially in the out years - as a way to criticize sugar farmers’ safety net. But just how accurate have these estimates turned out to be? In the case of sugar policy, not very. The chart below shows what CBO projected sugar policy to cost in March 2008, versus the actual sugar-related expenses to the USDA’s Credit Commodity Corporation (CCC).
CBO Projection
Actual
Difference
2008
$68 million
$0
-$68 million
2009
$113 million
$0
-$113 million
2010
$117 million
$0
-$117 million
2011
$110 million
$0
-$110 million
2012
$112 million
$0
-$112 million
2013
$118 million
$259 million
$141 million
2014
$124 million
$0
-$124 million
2015
$131 million
$0
-$131 million
TOTAL
$893 million
$259 million
-$634 million
One could argue that current sugar policy has operated at $634 million under budget since it was adopted in the 2008 Farm Bill. Savings would’ve been even higher had Mexico not violated U.S. trade law in 2013 triggering the only cost. The string of $0 isn’t a recent phenomenon either. Sugar policy costs to the CCC were $0 in 2003, 2004, 2005, 2006, and 2007 as well. Sugar’s long-time no-cost status is not surprising since Congress directed that sugar policy be run that way. The Farm Bill states: “[T]o the maximum extent practicable, the Secretary shall operate the program established under this section at no cost to the Federal Government…” CBO has rightly realized that the current policy will most likely not cost taxpayers a dime for the duration of the 2014 Farm Bill. And in CBO’s most recent estimate, which was released this week, it projects no cost operation for sugar policy in 2016, 2017, 2018, and 2019. Unfortunately, CBO does predict small costs after the Farm Bill’s expiration - again in the out years. This will once again give agricultural critics something to complain about, but if past is prologue, those predictions and the critics’ griping will both turn out to be a bunch of hot air. Originally posted here.