It’s not unusual for American farmers to receive billions of dollars in federal aid every year. It protects them when prices fall because of weather or market fluctuations.
But the Trump administration increased this long-standing safety net by promising an additional $12 billion in aid on Tuesday. It is specifically to compensate some farmers and ranchers from the fallout of President Donald Trump’s widening trade wars. Agriculture in America has seen prices drop and supplies pile up as other countries impose tariffs to counter Trump’s actions.
The effort is unusual because of its magnitude and because it originates from the president, not Congress.
Joseph Glauber, senior research fellow at the International Food Policy Research Institute in Washington, DC, said that this is notable because it comes in reaction to a “self-inflicted disaster.”
The U.S. Department of Agriculture revealed Tuesday that it will use a Great Depression-era law to send payments to producers of dairy, hogs and certain crops. It will also purchase surpluses of commodities including fruits, nuts, rice, beef, pork and milk and distribute them to food banks and other nutrition programs. The agency will also work with the private sector to develop new export markets for farmers.
Republican lawmakers criticized the new funding saying it was “welfare,” and that it comes on top of federal backstops that have been authorized by Congress through farm bills dating back to the 1930s.
The United States has a booming agriculture export business. China is the largest market for American farmers, while Canada and Mexico are also substantial buyers of U.S. agricultural goods.
“Most producers were very happy with the way trade was going,” Hart said, noting that many farmers run a trade surplus.
Many experts see the administration’s plan as an quick fix for the industry’s losses. But it doesn’t address the long-term pain that farmers will experience if the tariffs remain in place.
“The $12 billion package of agricultural assistance announced today by the administration will provide a welcome measure of temporary relief to our farmers and ranchers who are experiencing the financial effects of the trade war,” said Zippy Duvall, president of the American Farm Bureau Federation. ”This announcement is substantial, but we cannot overstate the dire consequences that farmers and ranchers are facing in relation to lost export markets … We will continue to push for a swift and sure end to the trade war and the tariffs impacting American agriculture.”