Trump's Trade
Will Perdue's Agriculture Assistance Strategy Be Enough To Save Farmers?
The most popular news in agriculture right now is Donald Trump’s tariffs. After the US government placed high charges on Chinese imports as a move against years of unfair trade, this Asian powerhouse has turned around and raised their own prices on key US goods, including soybeans, sorghum, milk, and pork. This causes farmers to have a surplus of production but no one to sell it to, severely damaging their bottom line.
In response, the US Secretary of Agriculture, Sonny Perdue, drafted a strategy to counteract this loss by providing up to $12 billion in farm assistance programs. Specifically, this money would be distributed through direct payments, boosting existing programs, buying surplus goods, or in overseas marketing. |
Perdue acknowledged that this problem is the result of our agricultural industry’s outstanding production rates and the unsurpassed work ethic of our farmers, and agreed that it is not fair that the men and women who work every day to put food on our tables are the ones suffering the brunt of this international spiff.
These farm programs, which will be an addition to current federal ag assistance, are not a perfect solution, as farmers would obviously prefer income to aid. Here’s what a few of the players in the agricultural tariffs conversation have to say:
“We always suspected that American agriculture would likely be the first sector hit, because our producers are extremely productive and are excellent competitors in the world marketplace. Indeed, of the total tariffs imposed on the U.S., a disproportionate amount was targeted directly at our farmers. In keeping with President Trump’s promise, his administration will not stand by while our hardworking men and women of agriculture are treated unfairly by countries acting in bad faith, acting as strategic economic competitors intent on breaking the rules. Accordingly, after careful consideration of the effect of China’s actions, USDA will employ tools at our disposal to provide up to $10 billion to $12 billion in programs, which is in line with the $11 billion impact on U.S. agriculture we have calculated.”
-Sonny Perdue, US Secretary of Agriculture
These farm programs, which will be an addition to current federal ag assistance, are not a perfect solution, as farmers would obviously prefer income to aid. Here’s what a few of the players in the agricultural tariffs conversation have to say:
“We always suspected that American agriculture would likely be the first sector hit, because our producers are extremely productive and are excellent competitors in the world marketplace. Indeed, of the total tariffs imposed on the U.S., a disproportionate amount was targeted directly at our farmers. In keeping with President Trump’s promise, his administration will not stand by while our hardworking men and women of agriculture are treated unfairly by countries acting in bad faith, acting as strategic economic competitors intent on breaking the rules. Accordingly, after careful consideration of the effect of China’s actions, USDA will employ tools at our disposal to provide up to $10 billion to $12 billion in programs, which is in line with the $11 billion impact on U.S. agriculture we have calculated.”
-Sonny Perdue, US Secretary of Agriculture
“These trade tensions are coming at a really difficult time for our farmers and ranchers in Idaho, as in the rest of the United States. Commodity prices are at a 12-year low, and labor is nearly impossible to find. So - but, you know, even in - with some of the challenges we face, Idaho is producing more food than ever. And so we definitely need to be able to trade. There's some hope, obviously, that the mitigation package can help and provide some temporary relief. I have great confidence in Secretary Perdue and his team, and I know USDA is listening and trying to address the concerns of U.S. agriculture and trade. But there are a lot of questions that need to be answered before we understand exactly what that relief is going to be seen as and what the details are.”
-Celia Gould, Idaho Director of Agriculture See her full interview here. |
“Nothing could be worse for farmers than a trade war. If other countries impose tariffs on U.S. soybeans, pork, or orange juice, it is a dagger in the heart of the business of being a farmer. The president understands the economic and political fallout of his war on agriculture, and his response is to cut a $12 billion check to farmers. To get a check, farmers will likely have to go hat-in-hand to Washington. Farmers will love that (not), particularly since the money they ultimately pry from Washington will be way too little, too late. Complicating things for U.S. farmers is that they are convenient political targets for our aggrieved trading partners. Rural America tends to be Trump country, voting in high percentages for the president in the election. Other countries rightly figure there is no better way to gain leverage with Trump than to make life difficult for those who vote for him.”
-Mark Zandy, Moody Analytics Economist
See the full article here.
So what do you think? Should Trump have avoided challenging China to protect the interests of American agriculture? Should farmers take the short-term woes so that other commodities, such as those within the technology sector, can get retribution on China’s crimes, eventually allowing the market to balance out? Does initiating the trade war, knowing it would hurt farmers, change your opinion of Trump or confirm what you already knew? Are there other stakeholders in this conversation you feel aren’t getting fair representation?
Head on over to my social medias and join the discussion!
-Mark Zandy, Moody Analytics Economist
See the full article here.
So what do you think? Should Trump have avoided challenging China to protect the interests of American agriculture? Should farmers take the short-term woes so that other commodities, such as those within the technology sector, can get retribution on China’s crimes, eventually allowing the market to balance out? Does initiating the trade war, knowing it would hurt farmers, change your opinion of Trump or confirm what you already knew? Are there other stakeholders in this conversation you feel aren’t getting fair representation?
Head on over to my social medias and join the discussion!