Trump tariffs hurting farmers, and GOP could pay a price in midterms
You get what you vote for.
Farmers in rural America overwhelmingly voted for Donald Trump in the 2016 election. Figures from Pew Research show that 62 percent of voters in small towns and rural areas—men and women both—voted for Trump.
And now those farmers are seeing the results of those votes as the trade war over Trump’s tariffs—and China’s retaliatory tariffs on many American goods and crops—are resulting in lower prices for American farmers.
The crop taking the biggest hit seems to be soybeans, but the damage is not limited to soybean farmers. Prices for all agricultural exports fell 5.3 percent in July, according to an August 14 report from the Bureau of Labor Statistics. That’s the biggest drop since 2011. On July 6, China started to impose 25 percent tariffs on a variety of American agricultural products. Soybean farmers, dairy farmers, and fishermen seem to be especially hard hit.
Even though China now says trade talks with the U.S. are back on, the scheduled talks are preliminary and being held by lower-level officials on both sides. The economic damage has been done.
“As ye sow, so shall ye reap” (Galatians 6:7). More than anyone else, farmers know all about sowing and reaping. Only in this case, what farmers got for sowing their Trump votes has turned out to be crops that are losing their markets. Their reaping isn’t exactly paying off.
Because of the trade war that Trump started, China has cancelled several soybean shipments from U.S. farmers and has turned elsewhere, mainly stepping up soybean purchases from Russia: China has tripled its soybean purchases from Putin-land. Those increases, however, represent only a fraction of what China usually buys from the U.S. Other countries picking up the soybean slack are Canada and Brazil. While other countries sell more, U.S. soybean prices continue to plummet; they’ve dropped 13 percent since the beginning of this year and have now hit a 10-year low.
The $12 billion in price supports Trump is touting are supposed to help farmers in four commodities that were hit hardest by Chinese tariffs: corn, cotton, pork, and soybeans. As usual in Trump world, that aid was announced with a big fanfare but has not yet been delivered. One farmer figured out that the farm payouts would be an average of less than $6,000 per farmer.
And what about other crops? If you grow anything else, you’re out of luck. As an editorial in The Modesto Bee, a newspaper in California’s agriculture-rich Central Valley, put it:
This trade war is hurting farmers across America, but it’s especially painful in Stanislaus, Merced and south San Joaquin counties.
After Trump threatened tariffs on Chinese steel and aluminum, China retaliated by targeting almonds, wine, walnuts and more products grown here. China imports $2 billion in ag products from California alone – mostly fruit, nuts and wine. That’s what we grow.
Farmers were urged to sit tight as the master deal-maker worked his magic. Since then, more tariffs and more retaliation. It’s so bad that Trump is now asking for a $12 billion to help farmers who grow corn, cotton, pork and soybeans. We grow those things, too, but they’re insignificant compared to our fruits, nuts, vegetables and wines. And those who grow our most important products are eligible only for federal government purchases of surplus produce.
Midwest soybean farmers are bearing the brunt of Trump’s simplistic meddling, even while they’re expecting a bumper crop this year. According to a story on Huffington Post:
America’s trade deficit jumped 7 percent in June, based on the most recent data. And [Brian Duncan, vice president of the Illinois Farm Bureau,] said the annual estimated net farm income, which is typically about $60 billion, is estimated to drop by $20 billion because of Trump’s tariffs.
“Oh, we’re losing money already,” he said. “As soon as harvest comes ― it’s going to start in a month ― this becomes real. This becomes real.”
The effects of Trump’s tariffs could very well turn out to be a political point in Democrats’ favor in the midterm elections. As Democratic Rep. Cheri Bustos, who represents many farmers in Central Illinois, said in the Huffington Post story:
“The numbers don’t lie. President Trump’s tariffs are putting the livelihood of thousands of hardworking farmers across the heartland at risk,” said Rep. Cheri Bustos (D-Ill.), who represents the district where these farmers live.
“During his campaign, President Trump promised he’d ‘end this war on the American farmer,’” she said. “I just wish he’d actually do it because right now all we’re seeing is a trade war that gets worse from one tweet to the next.”
Republicans are left floundering, afraid to criticize Trump while facing the wrath of their farming constituents. Rep. Devin Nunes, whose 22nd Congressional District in California has a large agricultural base, was one of several California Republicans (along with several Democrats) signing a letter to Agriculture Secretary Sonny Perdue raising concerns about the tariff trade war. According to the description in The Modesto Bee:
Chinese tariffs, they wrote, are “making fruits, vegetables and tree nuts in our districts significantly more expensive than their competitors” and “threatening the economic livelihood of our businesses and communities.”
Too bad Nunes is too busy having his staff call 911 to keep constituents away from his offices rather than take the issue seriously and actually meet with voters.
Farmers worry about long-term disruptions to valuable business relationships. “Farmers welcome the aid, but would very much prefer the original markets to sell their products into,” says Michael Nepveux, an economist with the Farm Bureau, the trade association for farmers and ranchers. “Trade aid is not is not going to make them whole.”
An analysis from Axios showed that some Republicans are worried, especially in the Midwest.
If the high voter turnout in Democratic primaries this year is any indication, especially in Midwestern states such as Wisconsin and Minnesota, at least some of those farmers who were Trump supporters may be voting with their feet—all the way to the ballot box.
Originally posted on Daily Kos on Aug. 19, 2018.