What Trump's Tariffs Have Unleashed for Farmers

Like most would be autocrats - and certainly most malignant narcissists - Donald Trump, a/k/a Der Trumpenführer, thinks he knows everything about all things.  As a historical note, Hitler and Nicholas II both thought they knew more than their top generals and the end results ended badly for both of them.  In Trump's case his Waterloo - for Fox News viewers, that was a horrific military defeat suffered by Napoleon - may be in the Mid-West in the center of "Trump country" and so-called flyover country.  The match that started the conflagration will likely be Trump's self-created trade war that is well on the way to decimating farming operations in places like Iowa.  States where the populace fell for Trump's siren song of racism and xenophobia and voted against their economic self-interest.  A piece in the New York Times by the  news director for the radio stations KNIA and KRLS in Marion County Iowa looks at the economic coming disaster Trump has unleashed, the beginnings of which should be evident before the vote in the midterm elections in November.  Here are excerpts:

Today President Trump is visiting Dubuque, Iowa, where every year at harvest time, millions of tons of grain come via rail and truck to be loaded onto barges on the Mississippi River and shipped to Mexico, China and much of the rest of the world. Harvest puts coin into the hands of farmers, and they and their communities — indeed all of America — profit. Not this year.

The president is here to trumpet a $12 billion plan to aid American farmers. Why do they need aid? For Iowans, it’s because 33 percent of our economy is tied, directly or indirectly, to agriculture, and Mr. Trump recklessly opened trade wars that will hit “Trump country” — rural America — hardest and that have already brought an avalanche of losses. Indeed, the impact of his tariffs will probably be felt by family farms and the area for generations.

The cost of being shut out of overseas markets for soybeans, beef, pork, chicken and more will be in the billions. Once those markets are gone, they will be difficult to recover. Commodity prices continue to drop, and good weather suggests an excellent crop is in the making, which will drive prices further down.

Brazil is ready to step in with increased soybean production, and China has already shifted its purchasing power there.

In farm country, U.S.A., the Trump tariffs have poured gas on what has been a slow-burning conflagration.  Rural America is about to undergo a major demographic shift. President Trump didn’t start it, but he has accelerated a crisis that might have taken a generation or two to play out. Now it might take only a few years. Rural America is going to be hollowed out very quickly. Farms will become consolidated, and towns that are already in trouble will certainly die.

Iowa’s farmers are aging, and younger farmers aren’t replacing them proportionately. Sixty percent of Iowa farmland is owned by people 65 years or older, and 35 percent of farmland is owned by people 75 or older. . . . This isn’t because young people in rural America don’t want to farm; it’s because, if it isn’t already the family business, the costs are much too high to allow many of them to get into it.

A friend, a small-town Iowa banker who specializes in working with farmers, offered a local example. It’s time for Mom and Dad to retire, get off the farm and move to town. Much of the time, if no heir is interested in continuing the operation, the farm is auctioned to the highest bidder. . . . but a big operation “bid it up more than it was worth, some guy from out of town no one knew — probably from one of the big operations up north. The kid didn’t have a chance. It was heartbreaking.”

I use Iowa in my examples, but much of rural America will be affected in a similar way. In the worst possible outcome of this scenario, losses and farm consolidation accelerated by Mr. Trump’s tariffs will make the devastating 1980s farm crisis look like a bump in the road as it drives a significant rural-to-city migration.

In my community, I learned this week that a hog operation I drive by every day is folding. The confinements are being dismantled, and anything portable can be found on Craigslist. A friend close to the family told me pork prices have been down for years, and with the tariffs it’s just not worth it anymore.

Another casualty: our community banks. As farms get larger, farm loans are less likely to be local. A big operation with farms in dozens of counties that maybe even cross state lines probably won’t use local banks for credit.

At a certain point, populations won’t be enough to support rural hospitals and clinics, and they, too, will be gone. Rural hospitals are one of the major employers in the community. Even if you have a good manufacturing company in town, if you lose the hospital, they won’t be able to attract the employees they need.

Those plants may be forced to leave as well — especially since the tariffs have hit them hard also. One friend who has a small manufacturing business says his costs have doubled since Mr. Trump announced tariffs on aluminum and steel, and that his business is down 40 percent.

Some of the farmers I speak with are unwavering in support of the president; they’d vote Republican even if Mr. Trump personally slapped the heck out of the preacher at the church potluck. But others are starting to recognize how the economic impact of the tariffs is hitting them personally.

This is why, earlier this summer, Vice President Mike Pence came to the Midwest for a reassuring visit and why Sonny Perdue, Mr. Trump’s secretary of agriculture, offered his $12 billion band-aid of a handout Tuesday. . . . Trump is here now, crowing of those billions. What farmers really want are the markets restored.

Farmers take out lines of credit in the spring — usually due the following Jan. 1 — to pay for seed and other input costs, and then pay the loans back after harvest. Like any other loan, there are consequences to not paying, including losing the farm. Farmers are going to know before the midterm elections if they are going to be able to pay back loans.

[W]hen the Trump payments are made to farmers, the larger operations will be the ones that gobble them up.

Mr. Perdue, and likely President Trump, know the $12 billion won’t make a difference, even in the short term. Farmers and others in the industry know the offer is meaningless. But most rural Republicans aren’t farmers, and many are Fox News devotees.

The destruction of a way of life cuts as deep now as it did back then, especially when it comes from this president. The only thing he knows about food is that it always comes served to him on a silver, or maybe gold, platter.

As I have noted before, while I worry about children and youths in these areas and what happens to them, for the adults who voted Trump/Pence, they need to reap the whirlwind of their actions and the suffering needs to be intense. 

Trump May Crash the Farm Economy

If there is any silver lining - or perhaps, irony is the better description - to the Trump/Pence regime, it is watching those who voted against their own economic interest to embrace Trump's overt calls to racism see the consequences of their ugly motivations begin to rain down on them.  Rural America - along with the Christofascists - put Trump in the White House.  Now, his policies are poised to wreak huge economic damage on these very same rural areas.  One state likely to be hard hit is Iowa - a state with a history of being progressive that sadly seemingly embraced Trump's racism and bigotry.  A column in the New York Times by an Iowa news director looks at what Trump may well do to that state's economy and the majority of farm families who voted for him.  If there is a god, they deserve to suffer for their betrayal of decency.  Here are column highlights:

Donald Trump won over 60 percent of the 2016 vote in rural Iowa, where I live, and I haven’t heard much concern from Republicans over [Trump's] the president’s alleged infidelities with a porn actress, his ties to Russia or Jared Kushner’s real estate shenanigans.

Or, for that matter, much concern about the administration scandals about wife beaters, Saudi princes, Ben Carson’s table or Scott Pruitt’s soundproof room. Many people don’t even know these scandals exist — they generally don’t lead in Sean Hannity’s or Tucker Carlson’s world. . . . there is a little rumbling about the increased deficit, but not much.

But people here — Republicans and Democrats alike — are paying great attention to what President Trump is doing economically, especially since he started in on tariffs. We have a strong manufacturing base in our county; when tariffs on aluminum and steel were announced, local manufacturing leaders tried to be diplomatic, praising the Trump tax cuts but saying the steel and aluminum tariffs would hurt their businesses by driving costs up.

One smaller manufacturer — a Trump voter — told me that his costs to produce his product nearly doubled overnight, and that his business has already been hurt by the tariffs. Prices didn’t rise only after the tariffs were announced; they started rising when Mr. Trump floated the idea.

But it’s the farm economy that rural Iowans are paying particular attention to. When [Trump] the president first proposed a 20 percent import tax on Mexico to pay for his wall, Iowans objected: Mexico is our second-largest export partner after Canada.

Mr. Trump has waffled on the renewable fuel standard before — ethanol is big around here — and Iowa’s entire congressional delegation and the governor’s office pressured him to renew it. We know he will waffle again, and potentially end it.

Most recently, when Mr. Trump imposed $60 billion in tariffs and sanctions against China, the Iowa Soybean Association said his action “poses an immediate and grave threat to their industry and Iowa agriculture.”

China has already responded with its own tariff on pork, which will have a dire impact on Iowa. Iowa is the nation’s largest pork producer, producing three times as much pork as the next-highest state.

A couple of banker friends who work with farmers every day told me last week that with commodity prices down and the tariffs imposed, approximately 10 percent of our farmers probably won’t make it this year, and 10 percent more will likely fail next year.

Even Representative Steve King, the avid Trump supporter and Iowan every liberal loves to hate, is worried about a new farm crisis.

Dairy farmers are particularly hard hit, suffering through four years of declining prices. It’s gotten so bad, dairy farming organizations are giving out suicide hotline numbers, as farmers are committing suicide in the hope that their insurance will save the family farm.

I’m focusing on the area I know, rural Iowa, but if [Trump] the president stays on course with the tariffs, the impacts will hit many rural areas all over America, what I call Trumplandia.

“It gives Democrats a generational opportunity to do the political work with farmers they haven’t done since the 1980s farm crisis,” said Matt Russell, a rural sociologist and farmer in Iowa. “Democrats do farm policy really well but are terrible at farm politics. Republicans do farm politics really well but have a history of doing terrible farm policy.”

Harvest will be coming in when members of Congress, in recess, return to Iowa to campaign. They will be getting earfuls from rural constituents about the economic impacts of Mr. Trump’s tariffs.

The president’s position is actually quite precarious. He’s already at a historic low approval rating. With the multiple scandals, rampant corruption and the Mueller investigation, the only thing keeping him near 40 percent approval — and most important, approval among most Republicans — is a strong economy. That, and Fox cheerleading. But if he tanks the rural economy, he and his legacy are in deep trouble.

Furthermore, if the rural economy turns sour, much of rural America will abandon Mr. Trump, and Fox may have no choice but to follow. . . . . They’ll believe that they have no choice, and it will be swift and ruthless.

Again, I hope these folks reap what they sowed and that they turn on Trump like a pack of wild dogs.