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All Things N ebraska
So much for cutting federal spending.
Just recently, President Trump announced a new $12 billion payout to American farmers.
It’s not a reward for great work – farmers produced another record crop this year.
No, it’s a bailout for a failed tariff war with China, that largest customer for our agricultural crops. President Trump loves tariffs, no doubt about that, despite the fact that when you place an additional tax on foreign goods, it gets passed on eventually to us at the cash register. But his attempts to get China to buy more American goods, especially soybeans and corn, have backfired, now twice.
Back in 2019, during Trump’s first term, he picked a trade fight with China. China responded by buying their soybeans elsewhere, like Brazil. It’s a pattern that’s continued.
Trump’s response back then was to cover his mistake by a bailout to farmers. The payout totaled $22 billion in 2019.
His latest trade deal with China requires that country to buy 12 million metric tons in the last couple months of this year. That brought some relief to our farmers, but it results in a 33 percent drop in soybean purchases this year by China compared to last year, before Trump’s latest tariff war.
Some deal. Going forward, the deal requires China to buy 25 million metric tons of soybeans a year, but that’s still less (1.4 to 14.2 million metric tons a year less) than the Far East giant had purchased in each of the last five years, according to figures compiled by the University of Illinois.
That China is again buying our agricultural goods – they quit entirely earlier during the tariff war – is good news for Nebraska farmers. So is the $12 billion bailout.
Corn and soybean farmers, especially young farmers, are struggling with high input costs and low prices for their crops. So hopefully more money in their pockets will help them hang on until trade policies get rational again, and prices rebound. It should also help rural towns, because more money usually translates into more spending.
To be sure, Trump had to do something – rural Nebraska voters are the reason he won, overall, in the state. Losing their support, well, wouldn’t be so great.
But writing extra checks to make farmers whole, as well as sending $20 billion to Argentina (a competitor for soybean as well as beef exports), doesn’t exactly square with the President’s goal of cutting government spending.
Remember DOGE, the Department of Government Efficiency? There’s a lot of disagreement over how much money DOGE actually saved taxpayers. That now-defunct agency claimed it saved over $200 billion – far short of the $2 trillion in savings pledged by its chainsaw-wielding chief, Elon Musk – but other analyses have concluded that number is wildly inflated, by tens of billions of dollars.
So spending an extra $32 billion doesn’t exactly work to reduce spending by the feds. Even I can do that math.
If you ask farmers and farm groups, they’d rather see “trade” and not “aid.” That means stabilizing trade with countries like China, and resuming healthy purchases of American agricultural goods.
Picking a trade fight with them didn’t work back in 2019, and didn’t work again now.
Trump pledged to make America “great again,” but let’s face it, his tariff policies haven’t exactly done that, particularly for our farmers.
Paul Hammel has covered the Nebraska state government and the state for decades. Prior to his retirement, he was senior contributor with the Nebraska Examiner. He was previously with the Omaha World-Herald, Lincoln Journal Star and Omaha Sun. A native of Ralston, Nebraska, he loves traveling and writing about the state.
