‘Trade, Not Aid:’ Farmers Are Pushing Back Against Trump’s $4.7 Billion Trade War Bailout
The U.S. government has announced $4.7 billion in direct payments to American farmers, as part of its previously-announced strategy for mitigating the effects of President Donald Trump’s trade disputes, in particular the spat with China.
But some farmers on the receiving end of the aid are pushing back against it.
As the U.S. has hit countries such as China, Mexico and Canada with tariffs on their exports, those countries have retaliated with their own tariffs on U.S. products. The retaliatory tariffs have often targeted American agricultural products, in order to affect Trump’s Midwestern base ahead of the November midterms.
The White House announced last month that it would direct up to $12 billion in emergency aid to American farmers, in order to offset the effects of those retaliatory tariffs. Agriculture Secretary Sonny Perdue announced details of the first tranche of that aid on Monday.
“Early on, the president instructed me…to make sure our farmers did not bear the brunt of unfair retaliatory tariffs,” said Perdue. “After careful analysis by our team at USDA, we have formulated our strategy to mitigate the trade damages sustained by our farmers. Our farmers work hard, and are the most productive in the world, and we aim to protect them.”
Of the $4.7 billion outlined Monday, $3.6 billion is going to soybean farmers, who have mostly now lost their biggest customer, China.
China’s retaliatory tariffs on U.S. soybeans led Chinese importers to turn instead to Brazilian producers. Meanwhile, the U.S.’s relatively cheap soybeans have been finding their way to Europe—something that was already likely even before European Commission President Jean-Claude Juncker agreed to have the EU import more American soybeans in order to play nice with Trump.
Farmers will be able to sign up for the relief from early September through January.
The U.S. Department of Agriculture will also buy up to $1.2 billion in commodities targeted by the retaliatory tariffs, and will spend $200 million on developing foreign markets for American produce.
That’s not enough, say some farmers.
“As soybean producers head into harvest, we need access to markets from trade deals and a stable Farm Bill, not short-term aid packages,” said Doug Schroeder, vice chairman of the Illinois Soybean Association, in a statement. “More U.S. soy gets exported to China than all other American agricultural products combined. Market access and trade certainty support our families, our businesses and our communities. Short-term aid does not create long-term market stability. Producers need trade, not aid.”
Representatives of other agricultural sectors have expressed frustration that they are getting relatively little, with National Association of Wheat Growers president Jimmie Musick saying the package “shows that the administration isn’t grasping the tough conditions being faced by farmers.”
Politico points out that the USDA structured the bailout plan so that Midwestern states that backed President Donald Trump in the 2016 election—like Iowa and Illinois—will receive hefty sums of cash leading up to the midterm elections in November. Meanwhile, states that grow produce and nuts, such as the liberal stronghold of California, aren’t expected to receive big government checks.
Perdue said in his statement that “all of this could go away tomorrow, if China and the other nations simply correct their behavior” relating to trade barriers and intellectual property theft—the U.S.’s justifications for hitting China with tariffs in the first place.
Also on Monday, President Trump said it was “just not the right time to talk” with China about the trade war. The countries held mid-level talks last week, but with no meaningful result.