Congressman wary of trade war, optimistic on farming
Congressman Darin LaHood gives credit to President Donald Trump on acting aggressively with Chinese tariffs but said he worries about what the long-term effect of a trade war might mean.
The United States imposed tariffs in April on steel and aluminum imports from China to, according to Trump, rectify decades of unfair trade deals. China blasted the tariffs and responded with its own tariffs on U.S. goods, including pork, corn and soybeans, all of which are major exports for the Midwest.
LaHood said that he was happy to see the president acting so aggressively to keep China in check.
“I give the president credit for going after the Chinese because they have been ripping us off for 25 years, specifically our military, technology, and forced technology transfers,” LaHood said. “I give him credit for trying to get them compliant. Obviously, he has used tariffs and begun a trade war to do that.”
Those trade wars, however, have the congressman concerned for the overall impact that it will have on farmers if it continues on for too long.
“Trade wars, in general, are not good long-term,” he said. “The pawn in a trade war is food, it’s agriculture. As soon as we instituted those tariffs, the Chinese retaliated against soybeans and corn. … How long do we let the trade war go before we begin to compromise our market share around the world?”
According to the University of Illinois, China surpassed Canada as the leading export for U.S. agricultural imports in 2012, especially when it comes to soybeans. LaHood said that the U.S. needs customers but is interested in how the imposed tariffs will play out in the near future.
“Tariffs can be used for leverage and it’s a mechanism that could get us a better deal with the Chinese,” LaHood said. “There’s also good news that we reached an agreement with our European allies. A trade war isn’t good, but I’m willing to give our president a bit of flexibility.”
In regard to the $4.7 billion in relief that will be distributed to farmers as a form of relief from the drop in exports, the congressman said farmers don’t want aid or subsidies. They want trade, he said, and the ultimate goal should be to work to wrap up trade negotiations.
LaHood is optimistic about the reworking of the North American Free Trade Agreement deal. Although Trump had reportedly announced he had reached a trade agreement with Mexico as a replacement for NAFTA, removing Canada from the equation entirely, Canada quickly responded with negotiations this week to keep the agreement alive.
“NAFTA is not going to work unless we have Canada as a part of it,” LaHood said. “We need to do everything we can to bring Canada to the table. A third of the products grown in Illinois go to Canada or Mexico so we’re heavily reliant on both of those countries.”
Things are looking up for the passage of a new Farm Bill, which expires in September. Congress and the Senate are in a conference committee to work out the issues between the two farm bills on the table.
“I’m optimistic we will get a bill passed,” LaHood said. “We passed a bill and the Senate passed a bill and we agree on 85 percent of what’s in it, we just have to get together that 15 percent.”
The two main issues currently holding up its passing is differences in which protections should be allowed for crop insurance and stricter regulations for the Supplemental Nutrition Assistance Program that would reduce eligible recipients to women with children, the elderly, and those with disabilities.