Farmers' frustration with Trump grows as US escalates China fight

American farmers have become collateral damage in a trade war that President Donald Trump began to help manufacturers and other companies that he believes have been hurt by China's "unfair" trade practices.
American farmers have become collateral damage in a trade war that President Donald Trump began to help manufacturers and other companies that he believes have been hurt by China's "unfair" trade practices.PHOTO: AFP

WASHINGTON (NYTIMES) - Peppered with complaints from farmers fed up with United States President Donald Trump's trade war, Mr Sonny Perdue found his patience wearing thin.

Mr Perdue, the agriculture secretary and the guest of honour at the annual Farmfest gathering in southern Minnesota this month, tried to break the ice with a joke.

"What do you call two farmers in a basement?" he asked near the end of a testy hour-long townhall-style event. "A whine cellar." A cascade of boos ricocheted around the room.

American farmers have become collateral damage in a trade war that Mr Trump began to help manufacturers and other companies that he believes have been hurt by China's "unfair" trade practices.

More than a year into the trade dispute, sales of American soybeans, pork, wheat and other agricultural products to China have dried up as Beijing retaliates against Mr Trump's tariffs on Chinese imports. Lucrative contracts that farmers long relied on for a significant source of income have evaporated, with Chinese buyers looking to other nations like Brazil and Canada to get the commodities they need. Farm bankruptcy filings in the year through June were up 13 per cent from 2018 and loan delinquency rates are on the rise, according to the American Farm Bureau.

The predicament of farmers is becoming a political problem for Mr Trump as he heads into an election year. For months, farmers have remained resolute, continuing to pledge support to a president who says his trade policies will help the agricultural industry win in the end. While there are few signs of an imminent blue wave in farm country, a growing number of farmers say they are losing patience with the president's approach and are suggesting it will not take much to lose their vote as well.

Mr Trump, who regularly brags about an economic boom despite signs of a slowdown, has in some cases made matters worse. He recently dismissed sales of American wheat, suggesting Japan was buying it only as a favour to the US. And his frequent tweets insisting that "farmers are starting to do great again" have rubbed some agriculture groups the wrong way.

"We're not starting to do great again," Mr Brian Thalmann, president of the Minnesota Corn Growers Association, told Mr Perdue at the event. "Things are going downhill and downhill quickly."

On Monday, after a 72-hour period during which Mr Trump twice escalated his trade war with China, Mr Thalmann said he could no longer support the president as he did in 2016.

"At some point we have to quit playing games and get back to the table and figure this out," he said. "There's no certainty to any of this."

Losing the world's most populous country as an export market has been a major blow to the agriculture industry. Total US agricultural exports to China were US$24 billion (S$33.3 billion) in 2014 and fell to US$9.1 billion last year, according to the American Farm Bureau. Exports of farm products to China fell by US$1.3 billion in the first half of the year, the agriculture group said this month.

A report from the Agriculture Department this month found that Canadian wheat exports to China have "rocketed" this year, while exports from the US have plunged.

The administration has tried to mollify farmers by rolling out two financial aid packages totalling US$28 billion. The White House has also dispatched Mr Perdue, the 72-year-old former governor of Georgia who was raised on a farm and trained as a veterinarian, to places like Minnesota, Iowa and Wisconsin to calm the nerves of farmers.

But as the trade fight gets uglier, farmers are beginning to panic. Last week, Mr Trump said he would increase tariffs on US$250 billion worth of Chinese imports to 30 per cent and impose a 15 per cent tax on another US$300 billion worth later this year. China has already said it will no longer buy American agricultural products and announced last Friday that it would raise tariffs on US$75 billion of exports from the US.

 
 
 

That prompted Mr Trump to describe Chinese President Xi Jinping as an "enemy" and suggest that he wanted to raise tariffs even higher, before declaring on Monday that talks between the two nations continue.

The trade conflict's toll on farmers is spreading to the manufacturers that serve them. Deere & Co, the maker of agricultural equipment, said this month that it was cutting its profit forecast for the second time this year. The company's chief executive said farmers were delaying purchases because of concerns about access to export markets.

The administration is looking for other ways to help farmers, including scrambling to secure additional trade deals. At the Group of Seven summit in France this week, Mr Trump said the US and Japan were nearing an agreement that would result in Japanese companies buying more American corn.

Mr Trump is also trying to appease corn farmers who complain that an Environmental Protection Agency decision this month will hamper ethanol production. Farmers say the agency's decision to exempt small oil refineries from a requirement to blend corn-based ethanol into gasoline has led to a drop in demand for the fuel.

On Thursday, Mr Trump summoned Mr Perdue and Mr Andrew Wheeler, who heads the EPA, to the White House to discuss options for increasing ethanol demand. The three came up with a package of policies that Mr Trump plans to unveil at a White House ceremony in the next week, according to people familiar with the plan. The package would leave the waivers for ethanol refineries in place, while slightly increasing federal mandates for production of corn-based ethanol and biodiesel and allowing vehicles that use high-ethanol blends of gasoline to qualify for special EPA credits.

Mr Perdue is a somewhat unlikely lieutenant in Mr Trump's trade war. As Georgia's governor, he worked to strengthen ties between the state and China, welcoming Chinese companies and making economic development trips to Shanghai and Beijing. At one point, he pushed for Atlanta to become a hub for the Free Trade Area of the Americas, a proposed 34-country trade pact that never came to fruition.

"He's a very strong supporter of free trade," said Mr Craig Lesser, who worked for Mr Perdue as Georgia's commissioner of economic development.

But in the Trump administration, Mr Perdue has been a staunch backer of the president's policies, publicly defending tariffs, working to shrink the federal government and expressing doubts about the science behind climate change.

"He's the Trump whisperer," said Mr Neill Herring, an environmental activist in Georgia who once worked with Mr Perdue in the state Legislature. "He can tell Trump exactly what he wants to hear."

Mr Perdue declined to be interviewed. His spokesman pointed to the extent of his outreach to farmers, noting that as of late July, he had visited all 50 states, had traveled more than 182,800km and had gone to 104 farms since taking the job in 2017.

Mr Perdue, who was once a Democrat, has also shown a penchant for pleasing conservatives. Last year, he pitched the idea of slashing federal food stamp assistance programmes by partially replacing food allowance money for the poor with "harvest boxes" of pasta, cereal and canned goods selected by the government. That plan was eventually scrapped, but Mr Perdue has continued his push to curtail food stamps this year, including last month when he proposed a rule that would cut three million people off from food stamps by changing the eligibility requirements.

Most recently, Mr Perdue won plaudits from top White House officials for moving part of his agency out of town. After agency research clashed with the administration's policy agenda, Mr Perdue decided last year to relocate two of the department's scientific divisions - the Economic Research Service and the National Institute of Food and Agriculture - to the Kansas City region from Washington. He claimed that the relocation was not retaliatory and was about moving researchers closer to their subjects.

According to the American Federation of Government Employees, only about 100 of the approximately 500 employees from the divisions have agreed to relocate.

When Mr Perdue addressed employees in June about the move, several stood and turned their backs to him, according to people who were in the room. Democrats have been outraged by the relocation, calling it an attack on science. And the Agriculture Department's inspector general said in a report released this month that moving the research units without congressional approval might be illegal.

In the West Wing, however, Mr Perdue's decision was seen as a stroke of brilliance.

 

At the South Carolina Republican Party's Silver Elephant gala in early August, Mr Mick Mulvaney, the acting White House chief of staff, hailed Mr Perdue's manoeuvre as a case study of how to "drain the swamp".

"It's nearly impossible to fire a federal worker," Mr Mulvaney said. "I know that because a lot of them work for me and I've tried and you can't do it."

At Minnesota's Farmfest, it was clear that Mr Perdue's Southern charm could go only so far. His answers to questions about how the trade war with China would end were curt, and his quip about whining farmers left some with a sour taste.

"We shouldn't have to whine to get paid," said Mr Joel Schreurs, a farmer from Tyler, Minnesota, who questioned Mr Perdue at the event. "They should be grateful that we're taking one for the team."

Last week, Agriculture Department staff members in Nebraska left the Pro Farmer Midwest Crop Tour after receiving a threat from an angry farmer. According to an organiser of the event, farmers have been venting to the government employees who attended the annual tour about depressed crop prices, falling farm income and difficulty gaining access to credit.

"This is a stressful time in agriculture," said Mr Joel Jaeger, the general manager of Pro Farmer. "There's certainly a lot of stress in the farm community."

But many farmers continue to support Mr Trump and express hope that the president knows what he is doing in his dealings with China. A July survey from Farm Journal found that 79 per cent of 1,100 farmers still back Mr Trump despite the lack of progress in negotiations with China, however his support dropped to 71 per cent in August.

For now, Mr Perdue largely remains an effective emissary, with the industry still hoping Mr Trump can pull off the kind of trade deal he has been promising.

"He's one of us; he's a farmer," Mr Brad Kremer, a Wisconsin farmer who is the treasurer of the American Soybean Association, said of Mr Perdue. "I think he's got a tough job in a tough administration."