Republican Governors Want Trade War With China Over Quickly

Steve Helber / AP Photo

 

Connecting state and local government leaders

An outcome to negotiations that lowers or ends Chinese tariffs could be critical to President Trump’s reelection hopes, Arkansas’ governor predicted.

WASHINGTON — Several Republican governors said Friday they want the trade war between the U.S. and China to end quickly, while emphasizing that they believe President Trump began the tariff war attempting to rectify unfair practices affecting farmers and owners of intellectual property.

Since January 2018, the U.S. has placed tariffs on about $250 billion in Chinese imports compared to $110 billion in retaliatory tariffs largely targeting agricultural products like soybeans.

U.S. farm exports are projected to fall $1.9 billion to $141.5 billion in fiscal year 2019, while China goes from being the top buyer in 2017 to the fifth-largest, said Robert Johansson, chief economist for the U.S. Department of Agriculture, at its Outlook Forum on Thursday reported Reuters.

Soybean exports alone have fallen 24 million tons, hitting certain states particularly hard. South Dakota, for example, produced a record-size crop in 2018.

“South Dakota has been devastated by the trade wars that are going on, and agriculture is our No. 1 industry by far,” said Gov. Kristi Noem, speaking at Politico’s State Solutions Conference on Friday. “When we aren’t able to export our soybeans to the Asia-Pacific region, when we’re struggling with commodity prices, that’s impacting not just those farmers who are on the ground but every Main Street business, everybody who has another entity out there that relies on those successful ag industries.”

Noem said she’s spoken to Trump administration officials in the last few days and plans to meet with them while she’s in D.C. for the National Governors Association winter meeting, and she’s consistently advocated for wrapping up trade discussions.

Arkansas Gov. Asa Hutchinson said Trump’s $12 billion support program to help farmers hurt by the trade war has softened the blow and that “there’s a great deal of patience among our farmers” for the president’s “tougher” trade policy.

“We want very quickly to get back to low tariffs,” Hutchinson said. “No tariffs should be the objective so that we can compete in the global market, and the president I hope will be able to achieve that through negotiations very soon.”

The door is opening “somewhat” to selling rice in China, he added, and he respects Trump’s desire not to have governors undermine the strength of his trading position.

On Friday, Trump told reporters he expects to have a meeting with  Chinese President Xi Jinping next month to talk trade. “We expect to have a meeting some point in the not-too-distant future . . . And I think President Xi and I will work out the final points. Perhaps and perhaps not,” Trump said, according to The Washington Post.

Kentucky Gov. Matt Bevin said he and Trump regularly talk by phone about trade and was supportive of ongoing negotiations.

“It’s moving us into the 21st century reality of trade that exists,” Bevin said. “Is it perfect? No.”

The White House is aware South Dakota farmers have previously had soybean shipments unfairly rejected by China, citing sanitary or regulatory reasons, Noem said.

“I think the administration is trying to rectify some of that,” she said. “The problem is this has gone on now for a long period of time.”

Farmers are used to risk and price fluctuations, but sustained, low commodity prices are “driving a lot of family businesses out of business,” she added.

Hutchinson said Trump has had some trade successes like signing a new North American Free Trade Agreement, renamed the U.S.-Mexico-Canada Agreement. That agreement still needs to be ratified by Congress.

A new trade agreement with China would be unprecedented, he said.

“I think it’s critical for President Trump that he has a good outcome as he goes into 2020, and he wants to carry Indiana and carry Wisconsin and Pennsylvania—states that he carried before,” Hutchinson said. “I think trade is a key part of that to show industrial America his trade policies have benefited the working class here in the United States and those that depend on those manufacturing jobs. I think right now that grade is a little bit incomplete, but I’m optimistic it’s going to turn around.”

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