Distortions due to Subsidies and Protectionism in Domestic Corn Production
These subsidies create huge distortions. Both the fuel ethanol industry and the corn sweetener industry are industries that exist almost entirely due to the subsidy. The U.S. sugar quota / duty system inflates domestic sweetener prices by two times. High fructose corn syrup and other corn-based sweeteners, along with domestic sugar, cost twice to manufacture than international sugar does, but the quotas and duties on imported sugar assure you’ll pay the extra cost. Fuel ethanol costs twice what gasoline does, but ethanol content laws in some states assure you’ll pay the extra cost. The subsidy of corn and feedlot waste disposal make concentrated farming operations more competitive than they would normally be, and thus much more prevalent.