Muftic: China hits the U.S. heartland with trade wars
Three weeks ago family members and I took a 2,400-mile round trip drive from Denver to Iowa’s southeastern border with the Mississippi, mostly following I-76 and I-80 for a memorial service for a family member. It had been over 20 years since I had traveled across far northeastern Colorado, Nebraska, and Iowa, the roots of both sides of my parents’ and my grandparents’ families. When I last made that trek I remember passing one corn field after another. This year for every two cornfields I saw was one field planted in soybeans. Towering above the landscape were new looking ethanol processing plants. Farm houses looked well maintained and the heartland looked prosperous. However, Donald Trump’s trade policy has just resulted in China retaliating by raising tariffs on US imports from our agricultural heartland.
Northeastern Colorado is like Nebraska, from Fort Morgan through Hillrose — my father’s birthplace — past Sterling to the Nebraska line. The last crop my grandfather raised was soybeans. In fact, Colorado State University has recently promoted more soybean planting because of its potential as a biofuel. Beef in Colorado is a $3.7 billion per year industry. I live in Colorado’s cattle and hay raising country. China had just lifted bans on U.S. beef imports, but now they have just raised tariffs on U.S. beef as well.
The Chinese are no dummies. China is also the largest market for U.S. soybean exports. They know GOP political leaders in Congress come from soybean, corn and hog land and they targeted their trade retaliation to hurt them the most. Several Colorado GOP members of Congress represent agricultural producing districts, as well. When President Trump announced his war on China’s steel imports to make good on a promise to the rust belt, I wondered if China would retaliate against the agriculture sector. They did.
The Chinese announced their retaliation and raised their tariffs on soybeans, beef, and pork. I recall listening to the radio in my early years in traveling across the heartland that livestock and grain prices and their future markets were reported early in the morning which would determine what farmers would plant or what and when take to market. Tuesday, April 3, the agricultural futures market crashed because of the Chinese retaliation to Donald Trump’s trade policies.
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But wait, you say, those farmers can still make money on raising corn and soybeans for biofuels. Do not count on the Trump administration itself to care about soybean farmers’ biofuel agriculture. Last week Scott Pruitt, who heads the Environmental Protection Agency (as of writing this) announced a roll back of clean car engine standards. The auto industry that has relied on biofuel mixed with gasoline to reduce emissions. Pruitt is the administration’s’ chief fossil fuel supporter.
He hails from Oklahoma and is beset by scandal for his closeness to oil lobbyists. Ryan Zinke, secretary of the Interior, a former congressman with campaigns funded heavily by the fossil fuel industry , is the same who opened up much of Utah’s Bears Ears for oil and gas exploitation. The fossil fuel industry has always resented biofuels that cut into their sales of oil and gas.
One of the pillars of Trump’s support is a thriving economy, but this could be weakened in both the heartland and by rising food prices to consumers everywhere thanks to the trade wars just launched by the president.
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