A Valentine ’s Day Full of Chocolate, Roses, and… Tariffs?
Scott Lincicome and Alfredo Carrillo ObregonChocolate and roses are the language of love, and through them, millions of people in the United States will today express their affection for their significant others. Yet, for the — *ahem* —dispassionate analysis we conduct here at the Cato Institute, candy and flowers are also prime examples of how free trade improves our lives by making it easier to purchase quality goods at lower prices, and by contrast, how protectionism does just the opposite.In the case of chocolate, we havepreviouslyexplained how the U.S. sugar program – a complex array of government price supports and import restrictions – dramatically increases U.S. prices of not only sugar, but also for chocolate, other sweets, and anything else that requires significant amounts of sugar. Today, U.S. consumers pay as much asthree times the world market price for sugar, and this in turn raises the price of sugary products like the chocolates gifted on Valentine ’s Day.High sugar prices harm not only consumers, but domestic food manufacturers (such as candymakers) and their workers too. The sugar programresults in the annual loss of an estimated 20,000 jobs in U.S. food processing industries, and many companies have left the country to avoid a massive tax on one of their main ingredients. For instance, chocolate‐producing firms like Ferrero, Nestlé SA, Tootsie Roll Industries Inc., Mondelez International Inc., and Mars Inc. haveset up operations in Canad...
Source: Cato-at-liberty - Category: American Health Authors: Scott Lincicome, Alfredo Carrillo Obregon Source Type: blogs
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