Agriculture Secretary Tells Farmers Not to Count on Future Farm Trade Bailouts

This Oct. 1, 2019 aerial photo shows farm buildings and a farm house surrounded by a crop of corn on a farm owned by the family of West Virginia Governor Jim Justice near Lewisburg, W.Va.

This Oct. 1, 2019 aerial photo shows farm buildings and a farm house surrounded by a crop of corn on a farm owned by the family of West Virginia Governor Jim Justice near Lewisburg, W.Va. AP Photo/Steve Helber

 

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President Trump previously signaled that more money to subsidize farmers for trade losses could be doled out.

The U.S. Department of Agriculture does not expect to provide another round of bailout payments to farmers this year to offset financial losses resulting from the Trump administration’s trade wars, Secretary Sonny Perdue told members of Congress on Wednesday.

Perdue’s testimony before the U.S. House Agriculture Committee comes after President Trump suggested last month on Twitter that payouts could continue as farmers wait for trade deals to reap benefits.

The agriculture secretary said he would advise against such subsidies, and he did not believe the president would issue any additional payments unless recently inked agreements fail to boost agriculture exports as intended. 

“If the trade does not materialize as we anticipate it will, then he’s willing to support another one,” Perdue said. “But I am telling farmers not to anticipate one, don’t expect one.”

The department has paid out $28 billion in trade-related aid to farmers since 2018. The Market Facilitation Program was meant to offset losses to farmers who lost sales or were subject to retaliatory tariffs from China over trade disputes.

The Trump administration has backed off the trade war and taken steps to improve the economic markets for farmers. In January, the president signed both a trade agreement with China and the United States-Mexico-Canada Agreement, which will replace the 25-year-old North American Free Trade Agreement.

It’s unclear, however, how much of Trump’s agreement with China and the USMCA will aid farmers and ranchers this year. The USDA projected this month that China will purchase about $14 billion in agricultural exports in 2020 from U.S. farmers—far short of the $40 billion in goods China has committed to purchase.

“If our formally targeted farmers need additional aid until such time as the trade deals with China, Mexico, Canada and others fully kick in, that aid will be provided by the federal government,” Trump tweeted last month.  

The president’s tweet contrasts with prior indications given by the administration that it does not intend to renew Market Facilitation Program payouts, said Rep. Angie Craig, a Minnesota Democrat, during Wednesday’s hearing.

“This kind of policymaking, it’s not predictable, it’s not reliable, It’s no way to make farmers run their businesses,” Craig said, going on to ask Perdue what he would advise the president to do with the program.

“I would not recommend another market facilitation program,” Perdue said. “I’ve expressed optimism that trade will develop but if it does not, I believe the president will do what he said he would do.”

Both Democrats and Republicans on the committee said they were supportive of the program in its first payments.

“I would hate to see what the situation would be in farm and ranch country if you had not taken those steps,” said Rep. Mike Conaway, a Texas Republican.

The program is not without its controversies. HuffPost this week reported that some farmers who received payments should have been ineligible for funds due to prior fraud convictions. 

The program also recently came under scrutiny by the U.S. Government Accountability Office amid allegations that money was unfairly allocated to southern states that supported Trump. 

Perdue said there was no bias in the allocation of money through the program and that the department had tried to respond to complaints about its funding formula as they were received.  He said about 70% of money allocated through the program actually went to midwestern states.

Andrea Noble is a staff correspondent with Route Fifty.

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