Trump to counter failed FDR tariff strategy with $12B ‘Fail Bailout’
Agriculture Secretary Sonny Perdue on Tuesday unveiled a three-part, $12 billion plan to ease the retaliatory tariffs on U.S. farmers through a mix of payments, purchases and trade promotion efforts.
The plan seeks to ensure that U.S. farmers and ranchers, a key constituency for President Trump and the Republicans, are casualties in the Trump’s aggressive trade policy.
Victims of Trump’s broad tariffs have prompted retaliation against U.S. farm goods like pork, beef, soybeans, sorghum and a range of fruits.
photo/painting by donkeyhotey
“This is obviously a short-term solution that will give President Trump time to work on a long-term trade policy and deal to benefit agriculture as well as all sectors of the American economy,” Perdue said during a call with reporters.
Perdue said the amount is in line with the roughly $11 billion in negative effects that USDA has calculated agricultural producers have suffered as a result of “illegal” retaliatory tariffs imposed by China, Canada, Mexico, the European Union and other major economies.
“The programs we are announcing today are a firm statement that other nations cannot bully our agricultural producers to force the United States to cave in,” Perdue said.
One example of the loss for American farmers is the U.S. Meat Export Federation citing the tariffs from Mexico — just one of the nations in the trade war — will lead to more than $835 million in annualized losses for the pork industry.
“It can’t just be about agriculture,” Sen. Thom Tillis (R-N.C.) said Tuesday, adding that he is waiting for the administration to provide more information on how its plan affects other industries that rely on trade.
According to the plan, the government will provide direct payments to growers and producers of soybeans, sorghum, corn, wheat, cotton, pork and dairy. The second part, will involve a “food purchase and distribution program,” would use authority under USDA’s Agricultural Marketing Service to purchase fruit, nuts, rice, beef, pork and dairy products from U.S. producers for redistribution to federal nutrition assistance programs.
Perdue said all of the programs are authorized under the Commodity Credit Corporation Charter Act, a Depression-era funding program that doesn’t require approval from Congress.
Sen. Ben Sasse (R-Neb.), a vocal critic of Trump on trade, blasted the tariff aid as a way of giving farmers “gold crutches” and warned that the current direction of U.S. trade policy could lead to economic circumstances similar to the Smoot-Hawley tariffs that have been partly blamed for straining the economy during the Great Depression.
“America’s farmers don’t want to be paid to lose — they want to win by feeding the world,” Sasse said in a statement. “This administration’s tariffs and bailouts aren’t going to make America great again — they’re just going to make it 1929 again,” he added.
