In an interview on Sunday’s edition of “60 Minutes,” John McCain blasted federal assistance for the sugar industry and claimed that “I would stop subsidizing sugar.” This comment has opened up a hornet’s nest of controversy. McCain has long opposed federal earmarks and corporate welfare, so his opposition to sugar subsidies is consistent with his platform. Although it is a principled stand, it may cost McCain support in Louisiana.

In Louisiana, the sugar industry is almost totally dependent on the federal government. While backing the McCain/Palin ticket, Governor Bobby Jindal announced his differences with the GOP nominee on this issue and reiterated his support for the federal support. This blanket support is unfortunate, but understandable since in Louisiana, the sugar industry employs 27,000 people and there are almost 700 sugar farms.

Despite his opposition to subsidies McCain is likely to win big in Louisiana. Yet, these comments might also become an issue in a much more competitive campaign, the U.S. Senate race. Scott Schneider of the Landrieu campaign lambasted McCain’s comments. Back in 2002, Landrieu was able to use the issue of “Mexican sugar imports” to change the dynamics of the race. Based on an article in an obscure foreign publication, Landrieu charged that the Bush administration had a secret plan to increase Mexican sugar imports.

It is interesting to note that the secret sugar plan never materialized, but it was a powerful issue.

Can Landrieu use this issue again to her benefit? Her opponent, State Treasurer John Kennedy, disagrees with McCain and favors the subsidies. In contrast, Democratic nominee Barack Obama raised his own concerns about subsidies, calling them “indefensible.” Yet, according to Democratic Party spokesperson Brian Welsh, Landrieu has not pledged “unconditional” support for Obama and therefore will not hesitate to disagree with Obama about the subsidies.

It is interesting that on this issue, the two presidential candidates agree in opposition to the subsidies and the two U.S. Senate candidates are both in favor of the federal support of the industry. This is an instance in which McCain and Obama are correct and the U.S. Senate candidates are just pandering to a local constituency. The free market should dictate whether the sugar industry succeeds in Louisiana, it should not survive on federal quotas, loans and price support.

The end result is that consumers are hurt by higher prices. It is the same problem with the Midwest farmers who receive even more obscene federal subsidies.

In one respect, it is also similar with what is happening on Wall Street and the $700 billion bailout plan. The taxpayers on Main Street should not have to bail out the failed captains of industry on Wall Street. The free market should be allowed to function in Louisiana, in the Midwest and especially on Wall Street.



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