Trump may cause farmers to 'lose all of what was a $9.1 billion market in 2018' thanks to his escalating trade war with China.
Trump's latest escalation in his trade war with China is not only decimating stock markets but is also causing farmers to lose billions of dollars, according to a Monday statement from the American Farm Bureau Federation (AFBF).
"China's announcement that it will not buy any agricultural products from the United States is a body blow to thousands of farmers and ranchers who are already struggling to get by," Zippy Duvall, president of AFBF, said in the statement.
China stopped buying U.S. agricultural products in response to Trump's Aug. 1 promise to slap an additional 10% tariff on goods from China. Even Senate Majority Leader Mitch McConnell admits that such tariffs are nothing more than a tax paid by American consumers.
Trump latest tariff announcement sent the stock markets tumbling, and China's response has not helped. Between Aug. 1 and Aug. 6, the Dow Jones lost more than 1,000 points.
And China's announcement means farmers will lose billions.
"Farm Bureau economists tell us exports to China were down by $1.3 billion during the first half of the year," Duvall said. "Now, we stand to lose all of what was a $9.1 billion market in 2018, which was down sharply from the $19.5 billion U.S. farmers exported to China in 2017."
In 2016, President Obama's final year in office, farmers exported $21.4 billion worth of agricultural products to China.
Despite the pain he is causing, Trump told reporters on Wednesday that the United States is "in a very good position" with China. He claims that China is hurting more than America, which, even if it is true, might be of little comfort to farmers filing for bankruptcies at record rates.
"We don't want to see people losing their farms and people unable to meet your financial obligations," former Iowa Lt. Gov. Patty Judge told CNBC. "But it doesn’t look like trade is going to get any better, so I think we're in for a very rough ride."
In addition to farmers enduring economic pain, American consumers are going to face higher prices on a range of goods from China. Everything from toys to shoes to washing machines will cost more. Depending on the extent of Trump's escalation, economists estimate the trade war is equivalent to a $3 billion tax hike on Americans every month.
Trump's "very good position" sure is hurting a lot of American farmers and families.
Published with permission of The American Independent Foundation.