Trade War and Oil Industry Waivers Continue to Harm Farmers

Empty grain receiving facility - photo credit: Washington Post.

Ironically, it is Republicans who preach - or at least pretend to preach - the mantra of personal responsibility and that bad decisions and actions should reap consequences on those who make bad life decisions. Thus, for example if suffers the consequences of being gay or poor, somehow one's choices are to blame, not social and economic barriers.  Applying this rule, it is delicious to see Mid-West farmers who helped elect Donald Trump pay an enormous economic and financial price for their bad and - in my view - morally bankrupt decision. I truly worry about the children and youths who are suffering as a result, but as for the adults who chose to vote for a narcissistic demagogue who played to their worse instincts and bigotries, they sadly deserve their fate.  Frighteningly, many continue to refuse to see their own fault in what has now befallen them.  A piece in the Washington Post looks at the continued economic devastation  Trump's self-created trade wars and pandering to the oil industry continues to wreak in the Mid-West in particular.  Here are story highlights (Note the idiocy and insanity: "Many of those grumbling about Trump today concede they are unlikely to vote for a Democratic presidential candidate next year."):

SIOUX CENTER, Iowa — On a typical day, about 80 tractor trailers full of corn line up to dump their loads at Siouxland Energy Cooperative, the ethanol plant just outside of town. The air throbs with the noise and vibration of this industrial moonshine operation, which distills nature’s harvest into a cleaner-burning fuel.

But today, the warm Iowa sun shines on an almost empty parking lot, and the machinery sits idle.

After two decades, Siouxland this month halted operations following the Environmental Protection Agency’s decision to exempt 31 small oil refiners from a federal law requiring them to blend ethanol in their gasoline. The waivers, which the Trump administration has approved almost four times as often as its predecessor, have undercut demand for ethanol and the corn used to make it, farmers said.

“The waivers are what pushed us over the edge,” said Steve Westra, 46, the plant manager. “It absolutely killed the potential for anybody to make any money at this.”

For Iowa farmers already suffering from an extended trade war with China, the ruling has made ethanol the focus of their growing ire over President Trump’s policies.

The trade war has cost farmers potential Chinese orders for the corn-based fuel as well as for a byproduct that is used as animal feed. Now, the refinery exemptions are compounding the financial pain — and threatening political consequences for [Trump] the president, who won this state and its six electoral votes in 2016.

“I supported Trump in the last election. Today, if the election were held, I don’t think I could vote for him,” said Kelly Nieuwenhuis, 60, a corn and soybean farmer in Primghar, about 40 miles east. “It’s definitely growing, the displeasure with the Trump administration.” . . . .Many of those grumbling about Trump today concede they are unlikely to vote for a Democratic presidential candidate next year.

In recent days, amid a rising impeachment furor, the White House has scrambled to midwife a compromise between ethanol advocates and the oil industry. . . . The discontent in deeply conservative northwest Iowa has its roots in [Trump’s] the president’s confrontation with China, which farmers initially backed.

The trade war’s mounting costs are especially evident in this corner of the corn belt. Iowa’s fourth congressional district, which sprawls from the Nebraska and Minnesota borders to the outskirts of Des Moines, has lost more export sales to China than any other district in the country, according to the U.S.-China Business Council.

China’s retaliation for [Trump's] the president’s tariffs on Chinese goods last year cost farmers 78 percent of their $856 million in oilseed and grain shipments to China, the study found.

Those figures may understate the toll. The trade war erupted as farmers were counting on a major increase in Chinese orders for U.S. ethanol and an ethanol byproduct called distillers dried grain (DDG.) Those potential sales for the past two years have now become casualties of the trans-Pacific conflict, Nieuwenhuis said.

China in 2015 had purchased more than 5 million metric tons of DDG, a high-protein animal feed, valued at $1.4 billion, according to the U.S. Grains Council. By the following year, China was the No. 3 export market for American ethanol, purchasing more than 200 million gallons, worth almost $350 million, the industry group said. Since then, DDG sales have plunged by roughly 98 percent; ethanol orders are virtually nonexistent.

China targeted Midwestern farmers for retaliation, calculating that complaints from a key part of Trump’s political base might cause him to buckle. The president so far has instead tried to make farmers whole with a $28 billion bailout and promises of future riches.

Neither seems to be working. Multiple farmers said the Agriculture Department payments that [Trump] the president bills as full compensation for lost Chinese sales, while better than nothing, still leave them in the red.

[The Trump/Pence] administration has exempted more than 38 billion gallons of gasoline and diesel fuel from ethanol blending requirements compared with just 7.4 billion in President Obama’s final three years, according to the Renewable Fuels Association, an industry group.

It is sad that racial animus and clinging to extremist religious beliefs mean more to a majority of these farmers than their own economic survival.  Adding insult to injury is that the rest of America has been forced to pay 28 billion to save these farmers from the consequences of their own idiocy and bigotry.

China’s Retaliatory Tariffs Will Hit Trump Country Hard

Areas to be impacted by China tariffs.

Donald Trump, a/k/a Der Trumpenführer,  seems hell bent on sparking a trade war with China.  Since Trump seemingly listens to no one and finds even briefings of more than a single page too taxing to read, perhaps he was oblivious to the fact that China would not just roll over and play dead when hit by tariffs by Trump.  Perhaps all he was focused on was bluster and "tough guy talk" so loved by his (in my view) cretinous/racist base.  In any event, China announced that it would play tit for tat and impose its own round of tariffs.  What is almost enough to make a progressive smile, is that China's proposed tariffs will hit Trump voting red states particularly hard.  Indeed, some states could find their economies significantly damaged and, rather than bring better economic times, Trump would have delivered economic hardship to his most loyal supporters.  China definitely knows how to deliver pay back to Trump.  Here are highlights from a piece in the Washington Post:

It was inevitable that China would respond in kind to tariffs levied against it by President Trump. [Trump] the president argued that the trade deficit and Chinese theft of intellectual property necessitated taking economic action. But the net effect is that China also will charge more for American products to enter its country — tariffs that are likely to affect places whose residents voted for Trump more significantly than voters in other areas.

The products to which China will add additional duties include manufactured products such as airplanes and vinyl records. (For some reason.) But they will also apply tariffs to a number of agricultural goods, according to CNBC, including:·        Yellow soybeans
·        Black soybeans
·        Corn
·        Corn flour
·        Uncombed cotton
·        Sorghum
·        Other durum wheat
·        Other wheat and mixed wheat
·        Tobacco

It won’t surprise you to learn that agricultural areas produce most of these goods. And rural areas supported Trump over Hillary Clinton in the 2016 election.

Take soybeans. Soybeans are heavily produced in the Mississippi River region . . . A tariff on soybeans affects a lot of places that backed Trump.

We can do the same thing for other products on the list, such as corn, which is heavily produced in the upper Midwest — a region that helped propel Trump’s narrow electoral-vote victory.  The map for wheat is dramatic, encompassing wide swaths of the country, mostly red.

[A]ny action taken by Trump that might negatively affect agriculture is almost necessarily going to affect places that preferred him to Clinton by a lopsided margin.

That seems clearly to be the case with the duties China will apply in retaliation for Trump’s tariffs.

Should these tariffs be implemented, frankly, I will find it difficult to not smile at the self-inflicted suffering of Trump voting regions. Deliberately put an unfit, racist, morally bankrupt individual in the White House and you deserve whatever misfortunes come your way.  Actions do have consequences.