The federal government's payments to farmers, designed to offset the impact of President Donald Trump's trade war, warrant scrutiny from the public and from Congress. The need for such payments reflects one policy failure; the process for calculating the handouts reflects another.
This is particularly important to farmers in Washington, who have seen overseas markets diminish as a result of Trump's tariffs on foreign goods, particularly from China. Those tariffs were predictably met with retaliatory tariffs by the Chinese government, which raised prices for agricultural goods from the United States and, therefore, reduced demand. Markets for wheat, corn and soybeans grown in Washington — along with other products — have slumped.
To offset that decline, American taxpayers have committed to $28 billion in payments to farmers under the Market Facilitation Program. In November, the president wrote on Twitter, "Our great Farmers will recieve (sic) another major round of 'cash,' compliments of China Tariffs, prior to Thanksgiving. The smaller farms and farmers will be big beneficiaries."
A minority report from a Senate committee indicates that benefits are inequitable. Farmers in Southern states have received inordinate bailout payments, and small farms have not been the big beneficiaries.
The report indicates that farmers in Southern states already have received more than $50 per acre, while those in Washington were sent less than $10 per acre. Georgia, Mississippi, Alabama, Tennessee and Arkansas have received the highest rates in the program overseen by Agriculture Secretary Sonny Perdue, a former governor of Georgia.
Last month, Sen. Maria Cantwell, D-Wash., said: "The president boasted about his trade wars today, but lots of Washington farmers have not been protected from these tariffs or have been blocked from delivering their crops. Secretary Perdue and President Trump need to stop the speech-making and deliver the support to farmers they have promised."
Cantwell and Sen. Patty Murray, D-Wash., joined 15 other Democratic senators in sending a letter to Perdue. The inequity, they wrote, "is picking winners and losers among farms and regions." Perdue, according to media reports, has yet to respond.
The U.S. Department of Agriculture reports that farmers in each Washington county will be eligible for no more than $32 per acre when payments are finalized. In contrast, every Alabama county is eligible for up to $150 an acre.
Meanwhile, the Market Facilitation Program provides no protection for owners of small farms in favor of international conglomerates. The senators' letter says this "will lead to further consolidation of family-owned farms and wipe out the next generation of farmers."
A report from the Environmental Working Group, which analyzed documents received through the Freedom of Information Act, says the top 1 percent of beneficiaries received 13 percent of the funds from the first round of payments. "America's farm safety-net is broken," senior analyst Anne Weir Schechinger said. "Instead of helping small farmers that have been hurt by the Trump administration's trade war, Trump's Agriculture Department is wantonly distributing billions of taxpayer dollars to the largest and wealthiest farms."
President Trump's trade war is a risky strategy that thus far has yielded few benefits. But as farmers throughout Washington are learning, the long-term costs could even outweigh the short-term drawbacks.