National Affairs: Much Ado About Sugar

Hawaii and Puerto Rico, although voteless, have long contended that they are entitled to equal consideration with Louisiana, Michigan, Colorado or any other State. Delegates from Honolulu are forever pointing out that Hawaii pays more income tax than any of 16 States. But last week U. S. citizens in those islands feared that the House of Representatives regarded them as mere colonies. Whereas New York or Georgia might refine all the sugar they could get their hands on, the House restricted Hawaiian refiners to 3%, Puerto Rico refiners to 16% of their own sugar which they produce for consumption on the mainland. This action Congressman Maury Maverick compared to declaring that “cotton grown in North Carolina couldn’t be made into towels there.”

The House had plenty of help in making up its mind. For seven months the most active lobby since the 1930 Smoot-Hawley tariff bill had buzzed about Capitol corridors. Chief Lobbyist Ellsworth Bunker, vice president & treasurer of the National Sugar Refining Co. of New Jersey, gave dinner parties for Congressmen in his swank 23rd Street home. Economist-Lobbyist John E. Dalton, ex-chief of sugar for AAA, wrote carefully prepared treatises and reference books demonstrating the need for protecting U. S. refiners and refinery workers (of whom there are only 16,000). Ex-Senator-Lobbyist Hubert D. Stephens of Mississippi and ex-Congressman-Lobbyist Loring Black of New York, both respected by their ex-colleagues, shouldered the contact work. A dozen lawyer-lobbyists and refiner-lobbyists, headed by General Counsel H. Beach Carpenter, stood ready at all times to see that the Congress did not lack for convincing information. Why, demanded the lobbyists, enlarge an industry off-shore when the same industry was at 62% capacity on the continent?

In their lengthy battle the sugar refining lobbyists ran up against opposition as tough as Washington could provide: the Roosevelt Administration. Secretary of State Hull objected to the 1937 Sugar Bill because: 1) it cut down Good Neighbor Cuba’s raw sugar quota by 6% and Cuba’s refined sugar quota by one-fifth—something to makeother Good Neighbors suspicious of Mr. Hull’s advances; 2) the Supreme Court had already cited U. S. refiners for monopoly. Secretary of the Interior Ickes ranted about lobbyists who would discriminate against his islands: “A form of protection not even suggested . . . in the days of Smoot and Grundy.”

Lobbyists also clashed with Agriculture’s Henry Wallace, but biggest obstacle they had to hurdle was the White House. Franklin Roosevelt simply stated that he would veto the Sugar Bill unless Congress lopped off discriminations against Hawaii and Puerto Rico, allowed them also unrestricted refining. When the Bill reached the floor of the House, Congressman Marvin Jones, Agriculture chairman and father of the Bill, introduced a courtesy amendment to right these discriminations, but he fooled no one. Said McCormack of Massachusetts: “[Mr. Jones] is a good soldier, but he talks with his tongue in his cheek.” The amendment lost, 135-to-92, and swarms of sugar lobbyists perched confidently in the gallery, knowing they had won, began making side bets on various minor amendments. The Bill itself finally passed, 165-to-55, and went to the Senate. Lobbyist Black rushed up to a group of Congressmen, chirped: “It’s all right now, you can go home.”

But, as it has before, the last laugh may fall to Franklin D. Roosevelt. The Senate may pass the Bill, but many observers believed no power on earth could hold Congress in session ten days after that, until the President’s anticipated pocket veto expires. In that case Congress might never have a chance to override, even if the lobbyists were strong enough to round up two-thirds of both Houses.

With that event, refiner-lobbyists would not be the sole losers. They had only been pulling chestnuts out of the fire. They would drop, at least for the time being, only a small share of their tonnage to island refiners, but U. S. beet and cane growers would be without the extended protection of the expiring Jones-Costigan Act, which has helped keep U. S. sugar more than three times as high as the world market price.