In our last post LOOKING TO THE FUTURE we stated people, businesses and organizations interested in things such as free trade should get in the game now or they’ll have no place to go for help. After all, one of the first things President Trump did was dump the Trans Pacific Partnership (TPP) and no Democratic 2016 contender favored it. Remember Free Trade is essential to the proper functioning markets that are the core of capitalism. This week we became aware just how much work was needed to be done. On Monday 2/13 we read an OP-ED in the Wall Street Journal we first thought was satire but apparently was a serious article. Blake Hurst the President of the Missouri Farm Bureau and a soybean farmer authored a piece “Free Trade and How the Soybean Helped make America Great”. In it Mr. Hurst stated:
In my rural county in northwest Missouri, home to plenty of soybean farmers, Mr. Trump received about 75% of the vote. We were drawn to policies like his “two for one” executive order, which requires the removal of two regulations every time a new one is written. The vocal and at times vulgar protests against him have only solidified his support here.
But unease is growing in the more fertile parts of the hinterlands. As his trade policy comes into focus, it’s starting to scare the heck out of farmers.
Mr. Trump is now embarking on a huge economic experiment, one at odds with what had been a bipartisan commitment to increased international trade. He has withdrawn from the Trans-Pacific Partnership, a trade agreement that, according to the Farm Bureau, would have increased net farm income by $4.4 billion. The president has also promised to renegotiate the North American Free Trade Agreement. Yet since Nafta was signed, U.S. agricultural exports to Mexico have increased to $18 billion in 2015 from $4.2 billion in 1994, according to the Office of the U.S. Trade Representative.
A soybean farmer like me looks at Mr. Trump’s statements with particular unease. Data from the National Oilseed Processors Association show that China and Mexico, both targets of Mr. Trump’s trade policy, were the top buyers of American soybeans in 2015.
The question crying to be answered is where was Blake Hurst and the Missouri Farm Bureau before the election? For that matter where was the American farm Bureau? Trump swept rural agricultural America. If farmers are just now getting scared for their livelihoods, maybe it’s because the people they relied on to make them aware of major threats to their well-being failed them.
The week was just getting started. On Wednesday 2/15 we ran across long time economics writer Robert Samuelson’s article in the Washington Post “The TPP lives-maybe.” In it he called attention to a new study from the Peterson Institute for International Economics, a think tank and unabashed advocate of TPP written by Jeffrey Schott. The author alludes to strong support for TPP among some in congress and “almost every major U.S. farm and industry association supports the TPP.” We at Detour on the Road are obviously major consumers of media pertaining to government policy, yet we can’t recall ever seeing Jay Timmons head of the National Association of Manufacturers (NAM) or Zippy Duvall the head of the American Farm Bureau on say cable TV forcibly promoting the benefits of free trade. Can you remember any of these or any other association leader doing so?
One person we found supporting free trade was Thomas J. Donohue, President and CEO of the U.S Chamber of Commerce. Unfortunately we found it in his ad in the Weekly Standard. Talk about preaching to the choir. Couldn’t the Chamber’s money be better spent educating some of the people who ultimately voted for Trump or backed Bernie?
In the same Weekly Standard issue we found something we had never heard of. In an article by John McCormack “Chilly Trade Winds” we were made aware of Senator Mike Lee’s (R-UT) Global Trade Accountability Act which would subject Executive tariff actions to congressional approval. Anyone heard of this bill? Who’s supporting this sensible bill in a big way? The NAM, The Chamber or the Farm Bureau? Anyone? Not that we could find.
So there you have it, an apparent growing awareness of the harm a reversion to Mercantilism could wreak on our economy gives us hope but at the same time wondering where were these people were in 2016 when TPP was trashed by both candidates? After our new President has formally dumped TPP is a little late in the game to expound on the virtues of free trade. More important, what are they willing to do now and in the future? Will we see Jay Timmons or Zippy Duvall joined by their counterparts from industry and agriculture on the cable news shows and talk radio making the case for free markets? Will we see the free market Libertarian or other like-minded third parties receive enough of their largess to be heard? Given their actions to date we wish we could more optimistic. Perhaps we can paraphrase Edmond Burke and say “the only thing necessary for the triumph of Statists is for good Capitalists to do nothing.” Capitalism has lifted billions of people out of poverty as nothing else ever has.People need be made aware of that fact starting now.