Trump's farm 'welfare' puts Capitol Hill Republicans in a tough spot

The Trump administration is preparing ...

Posted: Jul 25, 2018 8:46 AM
Updated: Jul 25, 2018 8:46 AM

The Trump administration is preparing to inject billions of dollars into the agricultural sector to protect farmers from the pain they're feeling from an escalating trade war.

On Capitol Hill, however, some members have a message for Trump: not so fast.

"It's a short-term solution and it doesn't solve any of the problems agriculture's got right now," said Sen. John Thune, a Republican from South Dakota who's a member of the GOP leadership. "What (US agriculture) needs is more markets, expanded markets. These policies are restricting markets, and to offset that they are going to make, basically, payments to farmers to recognize the loss they have experienced. But it's just not the right way to do it."

The administration announced Tuesday that it would provide $12 billion in funding assistance to farmers and that the deal would be only a short-term solution that would give Trump time to work on longer-term trade deals. But the possible influx in funding is forcing Republicans -- many whom blasted the Obama administration for bailouts during his first term -- to confront an uncomfortable reality. Handing out billions to the agriculture sector runs counter to conservative orthodoxy, but abandoning farmers who have struggled because of an escalating trade war may not be politically tenable with just months until the midterm elections.

"They'd much rather have free trade so they'd like to have trade arrangements already completed, but nonetheless, it's going to get down to a point where they're not going to be able to survive if this continues down the same path," Sen. Mike Rounds, a Republican from South Dakota, said of farmers. "If that means having a short-term aid package, that's certainly better than nothing."

Still, Republicans argue that instead of handing out billions to farmers, the Trump administration should look at its trade policy.

"The administration creates a problem for farmers so now they need to put them on welfare," Republican Sen. Bob Corker of Tennessee told reporters. "Yeah, I think that's kind of a misplaced policy."

During a private lunch Tuesday, senators expressed concern about the administration's trade policies, according to two members who attended. According to one Republican member in the room, members from farm country relayed there is growing frustration with Trump back home.

"It was people from farm country saying, 'Things have changed,' a lot fewer MAGA hats around," the senator said when asked to describe the lunch.

In recent months, senators across the ideological spectrum have been inundated with visits from farmers across the commodities marketplace. Most lawmakers said they've heard similar messages that farmers back home want "trade, not aid" assistance. But the prices of certain crops, like soybeans, have plummeted, causing some lawmakers to lament that temporary aid may be necessary even if it's not their preferred or long-term solution.

One of the hurdles for the administration may be where to draw the line. It's not just the agricultural sector that's feeling the pain of an escalating trade war. Sen. Lisa Murkowski, a Republican from Alaska, said the energy and seafood sectors in her state are also feeling the squeeze.

"Farmers are hit, but there are a lot of others that are hit by these tariffs as well," Murkowski said. "I've got a seafood industry up north that is not considered to be farmers -- we're farmers of the sea-- but the impact to the seafood industry is pretty significant ... as is the impact on the energy industries, so where do you draw the line?"

Despite concern from lawmakers, there may be little Congress can do to stop the payments. The money would likely come from funds that already exist, according to Republican Sen. Jeff Flake of Arizona, including the Commodity Credit Corp., a program created in the 1930s that provides a way for the government to help make up losses for farmers. Under that program, the corporation can borrow up to $30 billion from the US Treasury.

The food fight also puts red state Democrats in a difficult position. Senators such as Heidi Heitkamp of North Dakota have made the issue of trade a cornerstone of their campaigns, and protecting farmers is key to Heitkamp's re-election.

"We just really need to take a look at the details," she told reporters, adding that $12 billion may seem like a lot of money but it may not make up for the losses farmers are experiencing across the country.

Asked if the President deserved credit for proposing injecting billions into the agricultural sector, Heitkamp said "sure" before adding that "the best step he could take is getting rid of tariffs."

For Republicans, the issue of the agriculture bailout once again put rank-and-file members at odds with their own President, who campaigned on a trade vision that differed dramatically from the one Republicans have embraced for decades.

"This trade war is cutting the legs out from under farmers, and White House's 'plan' is to spend $12 billion on gold crutches," said Republican Sen. Ben Sasse of Nebraska. "America's farmers don't want to be paid to lose -- they want to win by feeding the world. This administration's tariffs and bailouts aren't going to make America great again, they're just going to make it 1929 again."

RELATED: Are we sliding back to the chaos of the 1930s?

Senators also say that long term, if the US loses out on certain commodities markets, it may be hard to ever re-enter them.

"I mean there are a million ways to shovel federal dollars there instead of just giving them access to markets, and the problem here is soybeans, for example, in Brazil are perfectly capable of filling the Chinese market and they have two growing seasons down there. Once you lose those markets, it takes a long time to ever get them back, so this notion that it's just applying pressure to the Chinese, then we get a better deal -- you lose (one) of those deals, then we're in trouble," Flake said.

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