Like many of you, I get all sorts of newsletters, from a variety of sources. A recent report about farm incomes, from this issue of Axios Markets, made me take a deep breath, because I’m old enough to remember the Republican Party that no longer exists.
That iteration of the GOP would have screamed bloody murder had a President imposed tariffs; defense of free trade was (forgive the pun) a party trademark. Those Republicans would have pointed to all the readily-available evidence of the negative effects of tariffs, including but not limited to the fact that they are paid for by consumers in the nation that levies them.
That GOP was also a champion of genuine capitalism, and an (admittedly selective) opponent of corporate welfare.
That GOP did scream bloody murder when President Barack Obama “bailed out” American auto companies. Never mind that we were just coming off the “Great Recession,” or that thousands of American jobs were at stake, or that the funds were structured as loans, not giveaways. They continued to criticize the decision even after it was clear that the intervention had worked, and even after the companies completely repaid the loans.
But I haven’t heard a peep from any of today’s Republicans about the mounting subsidies to farmers–subsidies meant to compensate them for losses entirely caused by Trump’s tariffs. Those subsidies are now larger than the amounts lent to automakers.
Here’s the information from Axios Markets that set me off:
What’s happening: U.S. farmers have been suffering this year. Chapter 12 bankruptcies have risen 24% over the previous year and farm debt is projected to hit a record high $416 billion.
While farm income is expected to reach its highest total since 2014, 40% of that income will come from trade assistance, disaster assistance, the farm bill and insurance indemnities, according to the American Farm Bureau Federation.
What we’re hearing: That’s “definitely not the normal,” Farm Bureau chief economist John Newton tells Axios. The $28 billion bailout package for farmers that President Trump signed earlier this year has “increased the percentage to a level we’ve not seen in a while.”
So let’s see. The party that believes in capitalism and markets–the party that counsels poor folks to suck it up and avoid ” welfare dependency”–is perfectly fine with government dollars supplying 40% of farm income.
The party of free trade has no problem with disruptive tariffs that interrupted farmers’ existing markets (many of which are unlikely to come back once this episode is over–other countries grow soybeans) so that their “leader” could look like the “tough guy” he clearly isn’t, and they’re hunky-dory with using billions of taxpayer dollars to compensate the people their idiocy injured.
Chinese imports of U.S. agricultural products totaled $24 billion in 2017 and peaked at $29 billion in 2013, according to U.S. government data. Imports fell to $9 billion last year as a result of the trade war.
Trump insists that he’ll make a new deal under which China will buy “40 to 50 billion” dollars of American farm products annually. As the Axios report notes, we’ve heard that song about an impending “great deal” before–and each time, Trump has had to pull back. Peterson Institute senior fellow Jeffrey Schott has opined that, even if a deal is signed, it’s unlikely that either side could deliver on its bloated promises to sharply increase US farm exports to China to $50 billion annually, “or anywhere near that total.”
Of course not.
Sentient Americans understand that virtually all of Trump’s pronouncements are untethered to reality–that they come straight from the fantasy universe he inhabits. What we don’t understand is where all those free-trade, fiscally-conservative, pro-market Republicans have gone.
I guess those policy preferences were less important than supporting a “leader” who promised them the continued dominance of straight white Christian males….