Just days before President Donald Trump travels to Iowa and Illinois, his administration announced plans Tuesday to provide up to $12 billion starting in September to help farmers already feeling the economic sting of his growing trade wars.
Much of the help will come in the form of direct payments to farmers, though parts of it also entail promoting U.S. goods abroad and expanding a program that buys surplus farm output and distributes it to food banks and other anti-hunger programs.
U.S. Department of Agriculture officials said there would be a signup period for the aid, with details forthcoming in a couple of weeks.
Administration officials and others called the aid package a temporary measure that doesn’t need congressional approval.
“This is a short-term solution that will give President Trump and his administration time to work on long-term trade deals to benefit agriculture and all sectors of the American economy,” Agriculture Secretary Sonny Perdue said.
Tuesday on Twitter, Trump continued to make the case for his approach on trade.
“Tariffs are the greatest! Either a country which has treated the United States unfairly on Trade negotiates a fair deal, or it gets hit with Tariffs. It’s as simple as that — and everybody’s talking! Remember, we are the ‘piggy bank’ that’s being robbed. All will be Great!”
While some Democrats and Republicans lauded the “trade aid” effort announced Tuesday, others — including farm-state Republicans who opposed tariffs from the start — were restrained.
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“What farmers in Iowa and throughout rural America need in the long term are markets and opportunity, not government handouts,” said a statement from Sen. Chuck Grassley, who also noted the aid package was encouraging for the short term.
Sen. Joni Ernst said Tuesday she remains concerned about the “debilitating impact” of the trade disputes.
“I continue to push the administration hard to open up new markets and finalize trade deals — as we need a longer-term strategy to our trade policy, not just a temporary fix,” she said in a statement.
Farmers and agriculture businesses are facing a lot of pressure as other countries retaliate for tariffs Trump has enacted on steel and aluminum. Further, negotiations over updating the North American Free Trade Agreement, seen largely as a boon to agriculture, are progressing only in fits and starts.
Soybean prices have nose-dived as the White House and Beijing engage in an escalating war of words. The first of the U.S. tariffs imposed on $34 billion worth of Chinese goods began early this month, drawing immediate retaliation from China against soybeans and a host of other U.S. goods, including other ag products.
In the state earlier this month, former Iowa Gov. Terry Branstad — now the Trump administration’s ambassador to China — urged farmers to take “the long view.” He said the eventual outcome will lead to more future food exports to a major world market.
His successor, GOP Gov. Kim Reynolds, who faces election this year, was more direct in calling Trump’s trade strategy into question.
“As I’ve said all along, nobody wins in a trade war,” she said in a statement. “We must continue to expand and open markets, protect the Renewable Fuel Standard and allow Iowa products to be sold across the globe.”
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Chad Hart, an agriculture economist at Iowa State University, said it’s impossible to tell now how much the aid package will help farmers.
“Really, we don’t know the damages to the soybean markets until we get into the fall,” he said.
The administration’s move, he said, is an attempt “to show that they are responsive to farmer concerns.”
He added it’s also a sign the administration believes the tariffs will be in effect at least through the fall harvest.
The announcement comes just two days before Trump is scheduled to visit Iowa and Illinois.
On Thursday, he’s set to participate in a roundtable discussion on workforce development at Northeast Iowa Community College in Peosta. That same day, he’s scheduled to visit a U.S. Steel plant in Illinois that said it reopened because of the new steel tariffs.
The Washington Post contributed.