Trump rocks the trade world

This past week, Secretary of Agriculture Sonny Perdue shocked the agriculture industry by announcing “tariff mitigation” actions to the tune of up to $12 billion. The goal, the U.S. Department of Agriculture says, is to get America’s trading partners to respect the rules and open markets.

So what are these actions? I’m glad you asked.

USDA put its plan into three “buckets.”

First, the Market Facilitation Program will offer payments to soybeans, sorghum, corn, wheat, cotton, dairy and hog producers, helping “farmers manage disrupted markets, deal with surplus commodities and expand and develop new markets at home and abroad,” according to USDA.

Second, USDA will purchase surpluses of fruits, nuts, rice, legumes, beef, pork and milk for nutrition programs.

Third, a Trade Promotion Program will aid in increasing export markets for U.S. agriculture products.

According to USDA, 37 percent of recent trade retaliation is directed at U.S. agriculture products. That number is no small potatoes.

The range of reactions from Washington politicians and agriculture organizations were all over the place. However, most of those making comments gave themselves some wiggle room by saying that the details still need to be given a hard look. You know the saying, “The devil is in the details.” Folks are on pins and needles waiting for more details.

Republican lawmakers have to be especially careful with the language they use when talking about the Trump administration’s actions. If you’re a Republican in office, you do not want to be at odds with President Trump—unless you’re not planning to run for re-election. That gives them a lot more room to speak their mind and not worry about the political ramifications.

House Agriculture Committee Chairman Mike Conaway, R-TX, said, “Our president stood up to a bully and now he’s standing up for rural America.”

Senate Agriculture Committee Chairman Pat Roberts, R-KS, said, “Trade remains the single best solution to the tough economy in farm country. I will 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.”

It remains to be seen if this aid package will have any impact on ongoing farm bill discussions.

The American Farm Bureau Federation said, “We are grateful for the administration’s recognition that farmers and ranchers needed positive news now and this will buy us some time. This announcement is substantial, but we cannot overstate the dire consequences that farmers and ranchers are facing in relation to lost export markets.”

Agriculture economist Bob Thompson said the aid package “should be viewed for what it is—an excuse to pump cash into rural America just before an election…will do nothing to rebuild trust and confidence in the U.S. as a reliable ag supplier.”

Longtime agriculture reporter Ellyn Ferguson said it best in a tweet, “The general theme of responses from ag groups is: Thanks for the $12 billion, but we still want the tariffs ended. And NAFTA, remember NAFTA?”

Editor’s note: Seymour Klierly writes Washington Whispers for the Journal from inside the Beltway.