Outside Influences

Trump Tries to Soften Trade-War Blow

The administration is offering aid to farmers hurt by the president's tariffs. Will it be enough?

In this July 18, 2018 photo, soybean farmer Michael Petefish walks through his soybeans at his farm near Claremont in southern Minnesota. American farmers have put the brakes on unnecessary spending as the U.S.-China trade war escalates, hoping the two countries work out their differences before the full impact of China's retaliatory tariffs hits American soybean and pork producers.
AP Photo/Jim Mone
July 24, 2018, 8 p.m.

The Trump administration’s announcement Tuesday that the Agriculture Department will provide up to $12 billion in aid to farmers hurt by the president’s trade wars is a sure signal that Republicans are desperately worried about the impact of declining commodity prices and reduced exports on the congressional elections.

President Trump’s tariffs on steel and aluminum have led China, Mexico, Canada and the European Union to impose retaliatory tariffs on U.S. farm products and resulted in reduced exports and lower prices.

For several months Agriculture Secretary Sonny Perdue has talked about payments and indirect assistance through the Commodity Credit Corporation, a 1930s entity whose spending does not require congressional approval. That idea has never been popular on Capitol Hill or with the heads of farm groups who believe that any amount of payments cannot make up for lost exports in the short term and damage to American farmers’ reputations as reliable suppliers in the long run.

Perdue had said he was hoping to come up with a plan by September, but the White House obviously decided that Trump could not travel to Iowa and Illinois this week and face questions without some answers.

The farmers’ frustration with the administration were evident last week at a House Ways and Means Trade Subcommittee hearing on the impact of tariffs on agriculture and rural America.

Cass Gebbers, an apple, pear, and cherry farmer from Brewster, Wash., told the subcommittee, “If the tariffs remain in place for the 2019 crop, buyers in China will look to secure supply from other origins such as the European Union or Turkey.”

Michelle Erickson-Jones, a farmer and rancher from Broadview, Mont., testified that the tariff on imported steel caused the cost of grain bins to go up so much that she and her family did not buy one. That decision had repercussions for local businesses and the laborers who would have put up the bins, she added.

Farmers still trust Trump but “patience is running out as we get closer to the main selling season,” added Scott VanderWal, a South Dakota farmer who is vice president of the American Farm Bureau Federation.

Farmers are also wondering whether House Republicans’ intense focus on work requirements for food stamp beneficiaries will mean the farm bill won’t be passed before the current one expires on September 30.

When the House passed its bill and headed to conference, House Speaker Paul Ryan issued a statement making no mention of the safety net for farmers, instead emphasizing that the bill is “a main plank of our workforce development agenda.”

The Wisconsin Republican was referring to the nutrition title of the bill, which would require adult beneficiaries of the Supplemental Nutrition Assistance Program (SNAP) to prove they work 20 hours per week and use the “savings” from people who drop out of the program for workforce training.

Republicans have portrayed House Minority Leader Nancy Pelosi as a “San Francisco Democrat” who doesn’t care about rural America. But in her statement, Pelosi said, “With America’s farmers, producers and ranchers facing plummeting prices, rising retaliatory tariffs and a struggling farm economy, we need a real robust, bipartisan farm bill more than ever.”

Pelosi added, “While House Republicans chose to advance a destructive and partisan bill that fails farmers and hungry families, this conference will provide an opportunity to return to the grand bipartisan tradition of robust farm bills.”

Pelosi was referring to the Senate farm bill, which included some provisions to tighten up on the Agriculture Department’s management of the SNAP program but no work requirements, is indeed bipartisan, and passed by a vote of 86 to 11. Senate Agriculture Committee Chairman Pat Roberts of Kansas and ranking member Debbie Stabenow of Michigan have said that a conference report with the House SNAP provisions can’t pass the Senate.

Campaigns against her have made Pelosi’s name so toxic in farm country that her statement won’t help her party win rural House seats. But smart, locally-focused rural Democratic candidates may find ways to build on her message.

Trump’s trade aid may help but Republican Senate free traders, including Roberts, signaled on Tuesday that they are skeptical. Roberts said he would "look closely at the president’s assistance proposal, but I hope that the administration is also working to quickly resolve the tariff situation and restore the export markets our farmers, ranchers, and growers rely on.”

Farm leaders were polite but skeptical, too.

North Dakota farmer Kevin Skunes, president of the National Corn Growers Association, said his groupappreciates the administration’s recognition of the harm to producers caused by tariffs and trade uncertainty. The fine print will be important. We know the package won’t make farmers whole but look forward to working with USDA on the details and implementation of this plan.”

The August recess may tell whether farmers think the Republican approach to the farm bill and trade still warrants their support in November.

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