California Farmers Union: Trade war with China

Roger Johnson, President National Farmers Union

As the world’s two largest economic powerhouses entered a formal trade war last week, the United States stood alone in its dispute with China, lacking the support of our traditional allies. What’s alarming is it’s not the policy proposals that are keeping our friends on the sideline—much of the world is harmed by China’s anticompetitive practices and theft—but rather the alienation of these countries by the White House. The President must work towards renewing our essential relationships during this week’s European visit. Winning a trade war with China depends on it.

 

President Trump was elected because he correctly diagnosed the systemic issues with our nation’s free trade agenda. He recognized the plight of farmers and rural residents who have endured decades of increasing financial difficulty, lost jobs and lowered wages due to flawed trade policies that favor corporations over individuals, particularly ones who do not live in large cities. And he identified the chief culprits for these issues: our massive trade deficit, our forfeited sovereignty, and our appeasement of China’s long history of manipulative and illegal trade practices. The U.S. elected this President because he would be a president willing to address these issues.

Much of the world stands united with the U.S. against China’s unfair trading practices because they too are disadvantaged by such anti-competitive behavior. China’s currency manipulations send reverberations through international markets and make all of our goods more expensive to sell in the Chinese market. China arbitrarily restricts agricultural goods. They steal company information and trade secrets, they counterfeit our brands, and they force outside companies to share technology in order to gain access to the Chinese market. Most importantly, China does not have a market-based economy. Its government operates as an authoritarian regime that directly influences its domestic market and props up Chinese businesses to unfairly compete on the world stage.

 

Yet despite our partners’ support for taking China to task, President Trump has isolated the United States in a go-it-alone approach. He has aimed harmful rhetoric towards friends, yet praised our adversaries. He has slapped tariffs on the entire world without the focus required to address true offenders. And he has abdicated influence on many matters of importance. Seemingly, the President is resolved to blow up the entire system rather than to lead it.

This approach has left family farmers bearing the brunt of retaliation from not only China, but also Canada, Mexico, and the European Union. And that retaliation is coming on top of an already very poor farm economy, which has declined 52 percent over the past five years. Since the start of June, soybean prices dropped by more than $1.50, corn by $0.50, and wheat by $0.30. American corn, soybean and wheat farmers have already lost a collective $13 billion as a result of our current trade war with the world. And while the tariffs can end tomorrow, the effects of this trade war will continue for years.

It’s time the President adopt a new approach—one with more tact and a recognition of the dire consequences staring down both farmers and all Americans. This requires negotiating at the table rather than shouting from a distance. And it requires a coordinated approach with our allies, which can begin as soon as the President begins to treat them like the strong partners they are. We can win this trade war with China—and it is one worth winning—with our friends by our side, not on the sidelines.