The bailout has so far cost U.S. taxpayers at least $28 billion.
Donald Trump on Friday continued to peddle a false narrative that tariffs levied against Chinese goods would pay for the billions of dollars in bailout money his administration has pledged to farmers hurt by his trade policies.
"IF OUR FORMALLY TARGETED FARMERS NEED ADDITIONAL AID UNTIL SUCH TIME AS THE TRADE DEALS WITH CHINA, MEXICO, CANADA AND OTHERS FULLY KICK IN," Trump tweeted, "THAT AID WILL BE PROVIDED BY THE FEDERAL GOVERNMENT, PAID FOR OUT OF THE MASSIVE TARIFF MONEY COMING INTO THE USA!"
This is a lie.
In August, Politifact looked into the same claim — that tariffs levied against Chinese imports would pay for the farmer bailouts — and determined it was false.
"Trump's claim simply does not reflect how tariffs work," it found. "The tariffs imposed by Trump have been paid almost entirely by U.S. importers, who pass much of that on to consumers through price increases."
In fact, American consumers and companies pay for "approximately 100 percent" of tariffs, according to a report from the National Bureau of Economic Research.
Trump is correct in that his trade policies have caused a great deal of harm to farmers.
From the time Trump launched his extended trade war with China through June 2019, farm bankruptcies increased by 45%, according to data from the Farm Bureau and Center for American Progress Action Fund. In 2019, Wisconsin saw a record number of dairy farms go out of business.
In response, the administration promised farmers it would offset the damage to their stockpiles and revenue by handing out billions in bailout money.
So far, that bailout has cost American taxpayers at least $28 billion. That sum is more than twice the $12 billion the Obama administration spent on the auto industry bailout in the early part of his first term, for which he was criticized by Republicans.
Additionally, Trump's farmer bailout has been slammed by many farmers as insufficient.
"This [bailout] was supposed to make sure farmers were not the victims of this trade policy," Jim Malhern, president of the National Milk Producers Federation, told the New York Times in 2018. "I think most agriculture producers feel that the payments have not come close to making up for the damage for the tariffs."
In December, the Trump administration announced the first phase of a new trade deal with China, promising farmers relief from the trade war. However, a February report from the Department of Agriculture showed that commodity prices did not get a boost from the deal and some experts remain concerned that China is still beholden to other trade contracts that would prevent it from buying American product quickly enough to make a difference to U.S. growers.
Published with permission of The American Independent Foundation.