Free Trade

Tomato Tariffs Pit Florida Against Arizona

America first? It really depends on what part of America you live in.

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You say tomato, I say here's an important lesson in how America First trade policies don't work for all Americans.

The Trump administration's decision this week to terminate a 22-year-old tomato trade agreement between the U.S. and Mexico—the Tomato Suspension Agreement—means that the juicy red fruits coming across the southern border will now be subject to a 17.5 percent tariff. That import tax, in turn, will likely lead to price increases and, potentially, tomato shortages. More than half of all tomatoes consumed by Americans come from Mexico, and the new tariffs could result in a price increase of as much as 85 percent, according to an analysis from Arizona State University.

It's easy to think about this latest skirmish in the trade war as being American farmers against Mexican farmers. "The Department of Commerce remains committed to ensuring that American domestic industries are protected from unfair trading practices," is how Commerce Secretary Wilbur Ross, in a statement, explained the rationale behind the new tariffs.

Indeed, tomato growers and some members of Congress have been lobbying the Trump administration for months, asking for the termination of the Tomato Suspension Agreement. They argue that Mexican tomatoes are flooding the market and making it impossible for American farmers to compete—American tomato production is down 34 percent since 2002, while Mexican tomato imports are up 125 percent in the same period, according to a letter sent in February to Ross by Sen. Marco Rubio (R–Fla.) and other members of Congress.

But this week's victory for Florida-based tomato growers comes at the expense of not only Mexican farmers and American consumers; it also deals a serious blow to tomato-importing jobs in Arizona.

Those are, of course, American jobs.

In Nogales, Arizona, for example, the largest single commodity brought over the border from Mexico is tomatoes. More than 1.5 billion pounds enter the United States each year, entering a supply chain that supports 30,000 American jobs, according to a University of Arizona analysis published last year. The new tariffs put those jobs in jeopardy.

"This will force Arizona tomato distributing companies to pay hundreds of millions of dollars just to be able to stay in business," Lance Jungmeyer, president of the Fresh Produce Association of the Americas, a trade group representing importers, said in March, when the Trump administration first signaled its intention to withdraw from the trade agreement. "Without a Suspension Agreement, produce warehouses in Southern Arizona will face extreme hardship and potential closure."

Lawmakers from Arizona sent Ross a letter in March asking him to reject the lobbying efforts from Florida and other states.

"Without the Tomato Suspension Agreement, Arizona's economy, jobs and tomato prices are at risk," Sen. Martha McSally (R–Ariz.) wrote in an op-ed this week.

Trump has apparently sided with Florida.

When trade policy is dictated from Washington, those types of choices are unavoidable. Trump's decision to put tariffs on steel and aluminum imports, for example, benefited the businesses that produce those metals—which immediately raised their prices—while disadvantaging any business that uses steel or aluminum to make its products. There are far more employers and employees in the latter category than the former.

The spat over imported tomatoes is a good reminder that trade isn't really conducted between countries at all, but between businesses and individuals seeking to find mutually beneficial arrangements. It's overly simplistic to think about Mexican tomatoes and Floridian tomatoes as if they are on opposite sides. More tomatoes being grown and imported into American means more jobs—and more delicious tomatoes.

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  1. Mexican tomatoes and Floridian tomatoes are merely pawns in the games of Uber-Superior Trumpian 11-dimensional quantum-gravity chess, and all who question Trumpian Ultimate Triumph in Endless Trumpian Uber-Trade-Wars… Deserve to DIE violent deaths, smothered by the endless casting of rotten tomatoes!!!

    “Let he who is without trade-war sins… We all KNOW that other nations have SINNED against us, the USA… Cast the FIRST rotten tomatoes!!!”

    Cue the endless parade now, of Trump-dick-sucking commentators, to cast the first rotten tomatoes at all of us who defend REAL free trade, which simply = minimizing FUCKING TARIFFS, which = taxes on us the consuming peons!!!

  2. >>don’t work for all Americans.

    what *does* work for all Americans?

    1. Alcohol

    2. well, start with minimizing taxes to those needed to support government operations. taxes designed to manipulate behavior should never have been allowed at all; sin taxes, tariffs, subsidies of all sorts implemented via tax holdouts, etc. if we want to include support for the less fortunate as part of government operations, ok, I think it’s bad policy because then it is politicized and loaded with waste/fraud/abuse, but then it is legitimate and explicit expenditure for a purpose.

      next, stop believing in the 11-dimensional quantum chess myth about how Mr. Trump is 6 steps ahead of his political opponents and the leadership of other nations. he is a pretty obvious believer in failed zero-sum game theory (failed big – led to the Great Depression, WW1, WW2, and a wide variety of other 2-steps-back aspects of the 200th C. – embrace of win-win strategies led to unprecedented growth of economies and relief of poverty worldwide), and supporting his delusions is not helpful. if he can’t be taught, then let’s build support to minimize his impact until we can elect a leader who will back better policies (spoiler alert: there is not a single one currently announced as running or interested from either major party or any minor one who fits this description).

  3. We were so much better off before Trump invented tariffs.

    1. Trump didn’t invent tariffs, but he sure as hell amplified tariffs!!!

      Trump isn’t growing tomatoes for us, he’s not making them cheaper for us, he’s not developing new ways to grow better and-or cheaper tomatoes… He is just TAXING us for buying politically incorrect tomatoes!!! And I for one, am NOT benefiting ONE tiny bit!!!

      1. Amplified how much, in percentages? Can you even tell me how many pages of tariff regulations there are, or how many products are subject to them? There’s a shitload of tariffs and trade restrictions that nobody talked about before and won’t be talked about now because everybody’s bawling about Trump’s additions as if they’re the only significant ones.

        1. https://www.haaretz.com/.premium-dont-confuse-me-with-the-facts-1.5381255

          Our craving for ideology means that we are partial to ideological leaders. But we need leaders who will make smart decisions that are aligned with the public interest.

          Week after week after week, Reason.com has presented the FACTS about how… Duh!!! Trump’s trade war has cost USA workers and consumers ever-increasing jobs and $$$BILLIONS!!! WHY should I cite more FACTS for you, when you are already ideologically hide-bound and committed to sucking Trump-dick, and protectionism?!?

          I give you ONE link above, to ponder, which I am quite sure that you will ignore…

  4. Lobe the math that says a 17.5% tax will increase prices 85%

    1. Yes, I do lobe your logic and eloquence…

    2. You prefer the math that says if you add 17.5 % at the wholesale end it’ll add 17.5% at the retail end? Democrats love that kind of math, too. If we double tax rates, we’ll take in twice as much money! There are multiplier effects in play when everybody along the supply chain works on margins. I’m skeptical that it will result in a 85% increase, but it certainly will be a lot more than 17.5.

    3. Well tomato tomatoe

      Potato potatatoe

      Let’s call the whole thing off

      https://m.youtube.com/watch?v=LOILZ_D3aRg

  5. Hmm, so what we really need are state tariffs?

  6. I think that the least accurate part of this story is the last part of the last sentence: “…and more delicious tomatoes.”

    When was the last time you had a truly delicious tomato from a supermarket or grocery store? Many of them look great but taste of basically nothing at all, and even the best ones have flavor that could most accurately be described as “okay.”

    1. I was thinking the same thing. Are most of the imported ones are used in sauce?

  7. A tomato that can survive at the bottom of that pile after being dumped out of a bucket isn’t fit to eat.

  8. […] to end a decades-long deal with Mexico that effectively raised tariffs on imported tomatoes. As I wrote last week, this means that the juicy red fruits coming across the southern border will now be subject to a […]

  9. […] to end a decades-long deal with Mexico that effectively raised tariffs on imported tomatoes. As I wrote last week, this means that the juicy red fruits coming across the southern border will now be subject to a […]

  10. […] to end a decades-long deal with Mexico that effectively raised tariffs on imported tomatoes. As I wrote last week, this means that the juicy red fruits coming across the southern border will now be subject to a […]

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