Farming

Trump Says He's 'Delivering' for Farmers. His Steel Tariff Says Otherwise

"There's not a day on the farm when a farmer doesn't touch steel," says Rep. David Young. And all that steel is about to get more expensive.

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Tuesday was National Agriculture Day, and President Donald Trump was on it:

But while Trump talks about "delivering for" American farmers, the most significant economic policy to come out of the White House so far this year stands to hurt farmers—and businesses dependent on farming—more than many other sectors of the economy. Trump's 25 percent tariff on imported steel will increase the cost of farming equipment and cut into farmers' bottom lines, and the tariff might trigger a trade war that could cut off American exports to Europe and China.

Scott Sinklier/Newscom

"There's not a day on the farm when a farmer doesn't touch steel," Rep. David Young (R-Iowa) told Treasury Secretary Steve Mnuchin during a House Appropriations Committee hearing earlier this month. "The agriculture industry is worried about these tariffs on aluminum and steel."

Young joined the rest of Iowa's congresssional delegation in sending a letter to the White House earlier this month urging Trump to reconsider the tariff "given the consequences this will have on states like Iowa, rural communities throughout the nation, and on America's farms."

While Iowa is best known for its farms (and its caucuses), the state's manufacturing industry is also worried about the potential consequences of tariffs. More than 3,000 factories are scattered across the state, according to the Des Moines Register, and many of them make the equipment used on farms in Iowa and across the Midwest. Steve Sukup, CFO of Sukup Manufacturing, which employs about 600 Iowans to make steel grain bins and dryers, tells the Register that tariffs are "a step backward" after tax and regulatory reforms helped businesses like his.

Agriculture industries are hardly alone in fearing Trump's tariffs. Artificially inflating the price of imported steel will hurt businesses across a wide swath of the economy. According to 2015 Census data, steel mills employed about 140,000 Americans and added about $36 billion to the economy that year, but steel-consuming industries employed more than 6.5 million Americans and added $1 trillion to the economy. In other words, for every steel-producing job in the country that might benefit from Trump's proposed tariffs, 46 steel-consuming jobs are put at risk. Everything from cars to housing will be affected. According to a policy brief released by the Trade Partnership, a Washington-based pro-trade think tank, Trump's tariffs will wipe out about 179,000 jobs.

Farmers and lawmakers from farming states are particularly worried about the prospect of retaliatory tariffs being imposed by Europe, China, and others targeted by Trump's steel and aluminum levies. American agricultural products would be an easy target for retaliation, because America has a large trade surplus with many other nations. For example, 60 percent of the soybeans grown in Iowa end up being shipped to China.

"Strong, fair trade favors American families and businesses," the Iowa lawmakers wrote in their letter to the White House, "and allows them to export their goods, which is critical for the farmers, manufacturers, and insurers in our state."

Soybean exports were already in a precarious state, according to Peter Meyer, senior director of agricultural analytics at S&P Global Platts, which advises investors about commodity markets. Writing at The Hill, he warns that fewer exports to China would wreak havoc on American farmers.

"The fragile U.S. economy cannot afford a trade war with China," he says. "No one should legitimately believe that political promises made in one area will not have an effect in another."

Trump seems to think so. Trade wars are "good, and easy to win," the president infamously tweeted shortly before launching his steel tariffs. In the factories and fields of Iowa, that feeling is not shared.

"There hasn't been a trade war we've won," Sukup tells the Register. "And we have the most to lose from it."

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  1. Our farmers always lead the way — we are PROUD of them, and we are DELIVERING for them!

    So… more agricultural subsidies, huh.

    1. Glad this was the first comment – something about hogs not wanting to compete for the teat.

      1. Or bean counters.

  2. Fuck farmers. I hate rent-seeking welfare leeches.

    1. Plus they always get mad when they catch you in the henhouse in your gimp suit, right?

      1. A man needs his privacy sometimes…

    2. That’s why you raise your own food, so you don’t contribute anything more to the welfare leeches than they already get. Right? Good on you for refusing to personally benefit from the lower food prices caused by those subsidies.

      1. Um, yes, he probably doesn’t raise his own food, AND benefits from industrial-class farming, but subsidies do NOT ‘lower prices’ for consumers.

        They spread the artificially higher prices over a massive part of the population, including everyone who does NOT buy or use whatever product or service is being subsidized.

  3. Oh look…Trump commented on some industry…now we have yet another excuse to rant about tariffs.

    Just feels lazy to me. Is the news cycle really that boring right now?

    1. I hate when people who provide free content don’t write about what I want, too.

      1. I just expect more than just repackaging the same story and having different character names (farmers, auto industry, HVAC industry, camel toe photographers, etc.) in the same roles.

        1. We’re gonna need a link to the camel toe photographers one.

          1. Caught my eye as well.

          2. Just use Google… 🙂

            http://www.fotosearch.com/phot…..eltoe.html for starters…

  4. “Trump Says He’s ‘Delivering’ for Farmers. His Steel Tariff Says Otherwise”

    And if Trump’s trade negotiations lead to reduced farm tariffs faced by American farmers, Reason will be writing a retraction of this article, right?

    1. And if if it leads to an all out trade war with even less opportunity for US farmers, you’ll STILL think the tariffs are a good idea.

      And if it leads to the opposite, more opportunity for US farmers due to dropping foreign tariffs, you’ll STILL want US farm subsidies to continue. And will probably want to keep the steel tariffs.

      And if we had an idealized world with no tariffs or subsidies anywhere, THEN you’d be unhappy if the US ran anything but trade surpluses, and would want some new tariffs. Because trade deficits are bad or something.

      Let me know if I’ve got you right or wrong.

      1. Oh, you’ve got it right, all right, and buybuy won’t understand or believe a word you or I say.
        I’ve read enough Ken Fisher and Milton Friedman to understand the downsides of tariffs and protectionism, but the unwashed masses have been fed the belief that those things actually help the folks they’re intended to help…

        Despite decades or centuries of evidence to the contrary.

        Can buybuy spell Smoot-Hawley or know how to google or Wikipedia it?

        Not likely.
        I’d love to be wrong about that, but I’m not optimistic.

  5. Iowa caucus-goers still picked Ted Cruz in 2016, even though he said he was against the methanol subsidies. So the farm lobby may not be as powerful as once thought.
    The tariffs, once the whole plan emerged, turned into weak tea when the two biggest providers of our imported steel, Canada and Mexico, were excluded until NAFTA talks were done – probably to stay that way – and he signaled that other nations could obtain exemptions, if they moved in the direction of freer trade.
    The idea of China, which only gives us 3% if our imported steel, opening a “trade war” over it, seems an overreaction.
    But #neverTrumpers gotta #neverTrump.

  6. “The fragile U.S. economy cannot afford a trade war with China…..”

    What’s this guy talking about, fragile? The economy has been doing great for the past 8 years; just ask Obama.

    1. … nine and nearly a half years, emm.. It hasn’t tanked since O was replaced by T.

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