U.S. Trade Representative Robert Lighthizer doesn't have much time for complaints that China's retaliation against President Donald Trump's proposed tariffs could hurt American soybean farmers. "It's not possible," Lighthizer told senators last month, "to take the position that, because of soybean farmers, we're not going to stick up for our rights in a whole variety of ways." (http://tiny.cc/…)
If you're a soybean farmer, that may sound coldhearted. It's not, however, the unkindest thing a Trump administration official has said about agriculture. That honor belongs to Wilbur Ross, who complained that ag's "screaming and yelling" was complicating the North American Free Trade Agreement (NAFTA) negotiations (http://tiny.cc/…).
Gee, guys. Are farmers really the villains of this piece? Your president refers to them as patriots. No one doubts they wish the rest of the country well. They salute anyone who sticks up for American interests, and not just agricultural interests. But when you go about that in a way that puts a bullseye on agriculture, inviting retaliatory tariffs, they naturally would prefer you try some other way. Are they not allowed to say that?
That the nation's top two trade negotiators have not exactly smothered agriculture with love is unsurprising when you think about their backgrounds. In private life Lighthizer was a trade lawyer who represented steel companies. Ross was a banker who restructured troubled steel, coal, textile and other manufacturing companies. When the interests of agriculture and industry conflict, or seem to, these two naturally put industry first.
Thankfully for farmers, Lighthizer and Ross aren't the only officials with the president's ear. He has an agriculture secretary and political operatives to remind him that farmers voted for him. And so, when the screaming and yelling gets loud enough, the administration starts looking for ways to appease agriculture.
Lately they've come up with two. The first, to compensate farmers for lost exports with additional subsidies, got a cool reception on Capitol Hill. Legislators connected with agriculture were quick to point out that farmers want to sell crops, not receive handouts (http://tiny.cc/…).
The second has more appeal to agriculture because it's about expanding trade opportunities. As DTN's Ag Policy Editor Chris Clayton reported, President Trump has instructed Lighthizer and economic advisor Larry Kudlow to look at the possibility of re-entering the Trans-Pacific Partnership trade agreement, which the American Farm Bureau Federation has estimated would eventually generate $4.4 billion a year in net farm income (http://tiny.cc/…).
Reconnecting with TPP wouldn't just open markets for agriculture and other American interests. With labor and environmental standards that previous American negotiators fought for, it would put pressure on China. Indeed, putting pressure on China seems to have been as important a motivation for the president as pacifying farmers.
Reconsidering TPP won't, to be sure, necessarily lead to rejoining. The president is insisting on a renegotiation of TPP's terms that many of the other 11 nations will resist. In the U.S., organized labor is strongly opposed. It's not at all clear a TPP deal could be ratified by Congress, especially if the Democrats retake Congress this fall. For the gory details of all the obstacles to rejoining, see this piece in the Wall Street Journal (http://tiny.cc/…).
Still, reconsideration is a step in the right direction.
And speaking of steps in the right direction, there's better news on the NAFTA front. Despite ag's screaming and yelling, the administration seems to be moving towards wrapping up the NAFTA renegotiation. According to the Journal, the U.S. has softened its demand on a critical sticking point, the level of North American content necessary for duty-free trade in cars. The current NAFTA requirement is 62.5%. Trump's negotiators were pushing for 85%, but are apparently now asking for 75% (http://tiny.cc/…).
The Journal quoted the Senate Agriculture Committee Chair, Pat Roberts, R-Kansas, on a hopeful note, saying Lighthizer had suggested there's an 80% chance a NAFTA deal can be worked out. "If we could see some success on NAFTA," Roberts said, "that would sure take the heat out of this issue, the whole issue of retaliation and farmers being the pawns in that whole situation."
Maybe, Senator Roberts, but success on TPP as well as NAFTA would do a whole lot more to take the heat out of the issue. There's nothing wrong with agriculture pushing for that.
Urban Lehner can be reached at email@example.com
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