Yves here. We have mentioned how DOGE’s cuts at the Department of Agriculture have hurt farmers by (among other things) reducing or ending access to high-value advice, such as on irrigation. When the tariffs were first discussed, some experts pointed out that under Trump 1.0, most of the taxes Trump collected went to farmers to remedy the damage those very same tariffs inflicted. So while damage to farmers and food safety from Trump’s trade schemes is no surprise, the update below explains some of the mechanisms.
By Anthony Pahnke (anthonypahnke@sfsu.edu), the Vice-President of the Family Farm Defenders and an Associate Professor of International Relations at San Francisco State University. Originally published at Common Dreams
Former presidential adviser-cum-rightwing podcaster Steve Bannon often mentions that discerning the truth of President Donald Trump’s policy goals entails focusing on the signal and not the noise.
But doing so has been next to impossible when trying to figure out the rationale behind the administration’s moves in agriculture, which since January have generated widespread confusion and uncertainty.
Specifically, while Trump publicly proclaims that he stands with farmers, his tariff war with China stands to rob producers of their markets. Since Trump’s last term, China has already been looking to countries like Brazil for soybeans as the U.S. has proven an unreliable partner. Adding insult to injury, unexpectedly cancelling government contracts with thousands around the country early in his term placed undue stress on farmers who already have to contend with what extreme weather events throw their way.
Now, with the details of the U.K.-U.S. trade deal becoming known, the signal—that is, the truth—of the Trump administration’s vision for agriculture is coming into view. To the point, not unlike how U.S. agriculture has been directed for the past few decades, it is becoming clear that this administration will prioritize exports. The problem with this vision is that, even if it generates short-term profits, it endangers our long-term national food security by dangerously further internationalizing our agricultural system.
Consider the praise that U.S. Agriculture Secretary Brooke Rollins heaped on the U.K.-U.S. deal that was made on May 8, singling out its supposed gains for farmers.
Following the announcement, the secretary announced a tour that she will take through the United Kingdom to tout the agreement. While details are still being hashed out, we are told of a promised $5 billion in market access for beef and ethanol.
Contrast that clear messaging—the signal—with how government contracts with farmers were frozen and made subject to administrative review, and the funding for local food programs was slashed.
The contracts were connected with the Biden administration’s Inflation Reduction Act (IRA), which included resources for initiatives like those dealing with soil and water conservation, and supporting local food processing. Additionally, programs that connected local producers with schools and food banks, for example, the Local Food for Schools Cooperative Agreement Program and the Local Food Purchase Assistance Cooperative Agreement Program, had their funding cut in the amount of about $1 billion.
Since February, some of the contracts have been unfrozen if they aligned with the administration’s political objectives (i.e. not promoting Diversity, Equity, and Inclusion, or DEI). Despite court orders ruling that all contracts must be honored, if and when the funds will be distributed, remains to be seen.
Overall, the noise surrounding the unfolding contract drama signals to farmers who want to diversify their operations and serve local markets that they should second guess looking to the government for help.
At the same time, Trump has not abandoned all producers.
In fact, amid the commotion about freezing some contracts, Secretary Rollins ok’d billions in direct payments, or bailouts, for growers of commodity crops such as corn. Thanks to such payments and not any improvements to markets, it is expected that farmers will see their incomes increase when comparing this year with the last.
Taken together, the bailouts along with the freshly inked U.K.-U.S. trade deal and easing of tariffs on China illustrate how the Trump administration prioritizes export agriculture as the driving force of our country’s farm system.
Such dynamics smack of contradiction, as Trump appears eager to send our food abroad while he’s willing to do whatever to bring manufacturing back to America’s shores in the name of strengthening the national economy.
Still, the deeper problem is with how export promotion makes our food system insecure, subjecting farmers to international political upheavals and economic disruption.
Remember the 1970s, when a grain production crisis prompted sudden demand in the Soviet Union. Then-Secretary of Agriculture Earl Butz told farmers to “plant fence row to fence row” and “get big or get out” to profit from the newfound export opportunity.
The promise of international markets came—and went. President Jimmy Carter’s embargo of grain exports to the Soviet Union in 1980 for that country’s invasion of Afghanistan came as a body blow to the farmers who made commodity exports central to their financial plans. Farmers then struggled to pay off the debt for the land and machinery that they acquired just a few years before, which, with rising gas prices, contributed to the 1980s farm crisis. Parallels abound now, including the initial effects of Russia’s invasion of Ukraine increasing fertilizer and gasoline costs, and most recently, the ongoing dynamics of Trump’s trade war with China.
Concerning the U.K.-U.S. deal, U.K. imports of ethanol may seem a boon for corn growers. But without future terms of the deal becoming clear, it is unclear if this is simply a continuation of what the British already import. Similarly, the significance of the slated $250 million in purchases of beef products is of questionable importance, as last year the U.S. exported $1.6 billion to China. Regardless of the recent 90 day truce in the China-U.S. trade dispute, the remaining 30% tariff would still hurt American farmers. The Trump administration’s export push will find farmers without markets and in need of more bailouts.
Besides subjecting U.S. farmers’ livelihoods to international uncertainty, the other concern is the lack of concern for the next generation of food producers. Year after year, the country’s farmers are getting older, with no one stepping up to replace them. According to the 2022 Agricultural Census, the average farmer is over 58 years old, up over half a year from when the last census was conducted in 2017. During that same time, we lost nearly 150,000 operations. Since 2012, over 200,000 farmers have left the industry, representing a 10% decline. Meanwhile, according to the U.S. Department of Agriculture, upwards of 70% of farmland is expected to change hands over the next 20 years.
Export promotion serves a temporary fix, but places farmers at the whims of international politics. Moreover, it threatens our country’s already economically pressed farmers, making our country even more dependent on a dwindling number of people for our food, as well as imports. In fact, since 2004, while exports have nearly doubled from $50 billion to $200, our food imports have increased slightly more so.
Trump’s efforts to undo the previous administration’s policies set up our food system for disruption and crisis, subjecting farmers to the uncertainties of international markets and developments elsewhere. If there is a signal with the noise that Trump is making with our food system, then this is it—farmers better get ready for a volatile next few years and more bailouts, as operations will continue to go under. Overall, Trump’s nationalist rhetoric amounts to little, as our food system becomes more global, increasingly made vulnerable to dynamics outside our control.
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It would be interesting to see a list of cuts to governmental services related to agriculture that the Trump/DOGE government has decided.
Technical relevant ones: agronomic consulting, meteorological services, pest and invasive species fighting; market-related ones: e.g. acquisition of local produce for schools and food banks, USDA grants; long-term environmental ones: study of climate change impacts, elaboration of mitigation approaches.
Combined with the wild gyrations on trade policies, it all means a much more fragile agricultural sector, hard-pressed to adapt to environmental and market conditions. It has already been suggested in NC that an appropriate comparison to the Trump/DOGE policies are the slash and burn reforms of the Yeltsin era — with attendant looting of Russia by its oligarchs and foreign corporations. Ominously, Russian agriculture went into a tailspin during the 1990s, with Russia reduced to constantly importing foodstuffs (a situation reversed under Putin).
I can only think that one of the main aims is to get rid of smaller farmers and in their place have huge corporation-operating farms over several States and regions and financed by private equity. Those former farmers could then get jobs on their former farms as farm workers. The technical services that vao mentioned above such as agronomic consulting, meteorological services, pest and invasive species fighting would then be done by those corporations themselves who would then be able to claim those services back on their taxes as a necessary business expenditure. Not such a stretch as this article mentions the call from the government to ‘get big or get out’ and that was from half a century ago.
Hire former farmers? That’s what H2a is for!
Many small farmers in the NE where I live have college degrees. If the farm is sold, my guess is most would just leave the industry. They are well aware of how farm workers are treated.
I wonder how much the icing out of small farms from these USDA funds is just more anti-PMC class warfare from the admin. Conservation funds, grants for “sustainability.” NGO brain-rot to the maga crowd.
Odd though, given the MAHA movement and the raw milk right being a seemingly significant part of the admin’s post-covid coalition and clearly aligned with the small farm ethos.
Also: Anecdotally more H2a use this year with smaller producers in the NE. Already the trend, but I think it’s accelerating. Farmers hoping to get more hours out of smaller crews – no risk of raids, no time off. When market is uncertain: squeeze labor.
The entire middle of the US doesn’t grow much food. Its two largest crops are corn and soybeans. 40% of the corn crop goes to ethanol plants. It grows feedstock: another 40% of the corn crop goes to feed cows, hogs and poultry. Less than 1% of the corn grown is ‘sweet’ corn, the kind humans eat. (I don’t know if that includes the ‘dent’ variety that is ground for corn meal.)
We export, depending on what source you use, about 50% of the soy crop. 70% of the US soy crop (what remains after subtracting exports?) is used for animal feed. Less than 1% of soybeans are fermented to produce tofu
The US does grow wheat, buckwheat (40% is exported to Japan!), oats, barley, sorghum.
In an earlier comment I gave a link to the official statistics detailing the final use (biofuel, foodstuffs, fodder, export) for major crops. The proportion of soy and corn used for biofuels is quite high.
And it’s on borrowed time, as aquifers drain from overuse. This is disturbing enough that the NY Times ran several pieces about this last year or the year before. More mismanagement so capital can maximize returns at the expense of the public good.
A minor quibble: tofu is not fermented. It is soy milk coagulated with calcium manganese (nigari) or other coagulant, and formed like paneer. Tempeh is fermented soy, and so it natto.
Natto fermented soy, not to be confused with NATO which is fermented Nazism. :)
Minor, but important, Birch! Thank you for the correction.
And, here’s a guide to making your own soy milk at home. I didn’t know you could do that. Or, that there are so many varieties of soy beans!
Well, here is a little anecdata for everyone. I have stated before that I have a background in mechanical/civil engineering, as well as construction from small-scale residential all the way up to multi-billion dollar civil stuff. Some while back I found myself working for the USDA using these skills, but the nature of this work with the agency has also brought me into contact with agriculture, agronomy, and conservation, where being an inquisitive person, I have learned a great deal and while in the process of my travels performing the engineering work, I also provide outreach and information about these other facets of the USDA’s remit.
The Conservation Stewardship Program was enacted about 15 years ago, and it pays farmers and other rural landowners to do conservation work on their farms, and unlike many other programs, which do not cover all of the costs associated with the conservation work, the Conservation Stewardship Program provides enough subsidy to supplement income. This program directly injects dollars into rural areas that are rife with poverty- I have no idea how many times that money changes hands before it leaves the rural areas it was injected into, but my guess is that it passes through many hands/households. I believe it is difficult to underestimate it’s stimulative effects. In the last decade, this program has injected many millions of dollars into the county in which I reside alone (My coworkers and I once added it up, and I am not going to share the number here, lest it be used to identify me). This volume of money is significant, and our efforts that helped inject this money into our community is something we have all been proud of, even if almost no-one knows what we have done. Long story short, we have been getting scores of applications for this program for years, and every year, up until THIS year, we have managed to fund every single application. This year, only 6% of those applications became program contracts. You read that correctly- the program was cut by 94%. Most of these funds went to farmers but a not insignificant chunk went to other landowners as well (mainly to assist with forest management- to prevent erosion, control invasive species, and to enhance/preserve wildlife habitat).
This is definitely going to have a measurable effect on the local economy, but very few people will know where the source of the bleeding was, & I suspect this is just one of many losses.
Then there is MMT.
All money is government money. There is no such thing as taxpayer money. All money is created by Federal spending no matter whether it is created into local community programs or sent to massive defence contractors.
Banks also create money when they make loans – it is effectively government money because bank deposits are guaranteed by government. Small, local banks create money into communities while Wall St creates money into share buy-backs and private equity.
Taxation exists not to finance spending but to maintain the value of the USD by extracting money to prevent inflation. But if taxes can be avoided the money can be swapped for interest bearing Treasuries. In other words, much of today’s wealth has nothing to do with enterprise but with legalized tax avoidance.
The whole system is corrupt from top to bottom. The purpose is to create inequality. In the final stages it has also created rage, which in a fascinating twist has been harnessed by Trump (actually the oligarchs behind him – he’s just a corrupt useful idiot) to amplify the dynamic.
Where will it end? The serfdom of America and fighting among the oligarchs until one remains as Augustus. The decline and fall will follow leaving an impoverished dark age.
On the other hand, MMT envisages a universal job guarantee and strong, vibrant communities created by public spending not private.
And that, of course, would be socialism.
A final comment – I think it was JKG who said the only way common folk could be wealthy would be to have outstanding public services.
Think there is another angle to this. There was a theory that in the future, the world would be dependent on US farmers or else starvation (food imperialism). To feed all the humans coming on line. Wall Street has driven up the price of farmland. Everyone was going to cash in, including the farmers who bought into this idea. Once again US narcissism. We are indispensable. Turns out the projections of the western geniuses were wrong again. Turns out the world doesn’t need US exports. That’s the big news. The world is having no problem feeding itself without Merica. Food is actually abundant. In most places the cost of food is going down not up. Only in the US, Canada and Europe is there food inflation. Because of egregious behavior and unreliability of US, people (who are just as capable as we are) are finding solutions that don’t involve becoming further dependent of the US hegemon. Bottom Line: My understanding is that US ag production needs to be cut by 25%. You can’t blame Trump policies for this structural problem which pre-dates MAGA.
People who want a better food system to sell them better food will have to create their own better food mini-systems where they live. Part of that would involve paying for better food from better farmers wherever they are. A lot of that would be paying for better food from better artisanal farmers living as close as possible to the would-be buyers of better food.
Better food quality, better food security, better food sovereignty, etc. require more and better work from the producers of that better-in-various-ways food. That would mean that the better food will have a higher price. Higher price IS the price of better food. Those who don’t want to pay the higher price can go without the better food.