Many American industries — agriculture included — have been urging President Donald Trump to end the trade war, but he doesn’t seem to be listening. This week Trump announced tariffs on steel from Argentina and Brazil, and he imposed new tariffs on France.
He claims the tariffs are working and that trade relations with China are improving; however, that’s difficult to believe. U.S. farmers remain at a disadvantage with China, and the challenges are reflected in farm income, which has fallen since the Trump tariffs began two years ago.
Trump has distributed $28 billion in bailout funds — twice the 2008 bailout the U.S. auto industry received at the start of the Great Recession.
Farmers have been grateful, but the bailouts amounted to only pennies per bushel to offset the billions in lost income since the tariffs took effect. The trade war has been bad news in farm country, but the damage could grow worse if Americans look more closely into the many ways Uncle Sam protects farmers against loss.
This week we were surprised to hear comparisons in national news reports of trade war bailouts and auto industry bailouts, which kept carmakers afloat.
Bankruptcies are rising in farm country, but Americans probably don’t believe farmers and ranchers are in the same dire situation as automakers. Each time Trump shovels out billions in trade war bailouts, Americans grow a bit more suspicious about the billions of dollars they’re paying to stabilize and protect farmers.
Chris Edwards, who writes for downsizing government.org, outlined the various forms of farm aid in an essay urging the end of federal farm subsidies. Here are some of the ways farmers get financial help from Uncle Sam:
n USDA crop insurance costs American taxpayers about $8 billion per year.
n Agriculture Risk Coverage pays subsidies to farmers if their revenue falls below a guaranteed level. Cost was $3.7 billion in 2017.
n Price loss coverage covers more than 20 crops. Payments were $3.2 billion in 2017.
n Conservation programs cost taxpayers more than $5 billion a year.
Other forms of farm aid include marketing loans, disaster aid, marketing and export promotion, and research.
The agricultural industry frequently has had to defend itself from negative press and unfavorable consumer perceptions. As we said, Trump’s trade war bailouts have been worth just pennies per bushel. They hardly have prevented the dike from leaking, but they may be attracting unwanted attention to Uncle Sam’s farm support programs. If that happens, farmers will be double losers in Trump’s trade war.
Farmers don’t want bailouts. They want access to foreign markets.