For farmers in America, recent problems caused by tariffs are costly — and also reminiscent of trade-related debacles decades ago.
In one unforgettable example, bold U.S. intervention on trade in the 1980s backfired and contributed to a decade-long economic crisis that devastated farm operations nationwide.
Much of the blame for the farm crisis of the 1980s was attributed to President Jimmy Carter, a Democrat who unleashed a partial embargo on grain exports to the Soviet Union in 1980 in response to the Soviet invasion of Afghanistan.
Producers — and particularly those who lost their wheat market — paid the price, a toll well known in Kansas. As grain prices plummeted, the federal government tried to respond with payments to farmers, who weren’t appeased. And the Soviet Union simply found other willing grain exporters to satisfy their demand.
Republican President Richard Nixon made a similar blunder in 1973 when he restricted soybean sales to Japan. The Japanese also found alternative sources.
Fast forward to 2018, and President Donald Trump’s trade war with China — a move designed to counter theft of intellectual property and rectify a global trade imbalance. But, as happened before, it’s done far more harm than good in halting exports of American soybeans, sorghum and other crops.
The latest setback followed several years of falling farm income and rising debt levels in the U.S. In Kansas, recent heavy rain and flooding made a bad situation worse.
And now, in the midst of fall harvest, we’re again seeing producers in Kansas and beyond stockpiling crops they can’t sell, while other countries fill the void for eager buyers. Farm bankruptcies have spiked in big ag states, Kansas included, as farmers are again being punished by bad decision-making in Washington, D.C.
Kansas’ GOP members of Congress who regularly turn a blind eye to fellow Republican Trump’s antics have failed to defend the interests of constituents back home — from producers themselves to consumers left to pay higher prices because of the trade war.
The president offered farm operators a Band-Aid of payments. But farmers, to their credit, want markets — not handouts. A government bailout cannot make farmers hurt by self-inflicted trade disruption whole again. History has proven as much.
Then there’s the hypocrisy of conservative Republicans throughout Congress. They howled in anger over the 2009 automotive industry bailout by then-President Obama, but said nothing about the cost of Trump’s aid for farmers affected by his tariffs — some $28 billion in federal assistance that’s about double the cost of the auto bailout, which also differed in that all government dollars extended to automakers were paid back to the federal government with interest.
Plus, Obama’s policies didn’t cause the auto industry’s financial meltdown. Trump, on the other hand, started a trade war certain to harm U.S. agriculture, and blatantly used farmers as pawns. The ill-advised actions hurt not only farmers, but also businesses and communities that depend on agriculture.
Trump somehow thought he could immediately fix a trade deficit that was decades in the making. He was wrong.
Damage from his shortsighted maneuvering promises to be far-reaching and long-lasting, as with the farm crisis of the 1980s. That’s frightening and unacceptable — especially when history has shown us the devastating consequences of such recklessness.