Capitol Hill is only about 1,100 miles from Farm Talk’s corner of Kansas, but its clashing culture and distance from agricultural agendas often makes it feel like a million miles or more.
During the 2019 Risk and Profit Conference in Manhattan, Kansas, Agri-Pulse editor and founder Sara Wyant brought the talk around Washington closer to home for producers by sharing four of her top issues from the capitol.
Tariffs and trade are as common a coffee shop topic as they are a congressional topic — and it often seems both groups are equally equipped to solve trade dilemmas. For Wyant, the best news on the topic of trade comes from negotiations outside of China, particularly in the United States-Mexico-Canada Agreement and in Japanese negotiations.
“There are discussions ongoing between a working group that has been appointed in the House by Nancy Pelosi and U.S. trade ambassador Bob Lighthizer,” Wyant said. “They have a list of demands they would like to see changed in the USMCA primarily about enforcement of environmental and labor issues — of course that’s tricky because the Mexican government has passed this agreement already.”
Re-opening the USMCA agreement has met resistance from Republicans who find the agreement to be relatively positive toward agriculture and want to avoid exposing the agreement to any adverse changes. Wyant said the working group discussing the changes is hopeful the revisions can come in the form of side agreements made by Lighthizer without reopening the original agreement.
“We’re feeling pretty good that the USMCA could go ahead this fall,” Wyant said.“Of course, the President has threatened to pull out of NAFTA altogether if things don’t go well so we are always on the lookout to see if that could possibly be something that he would throw out as another threat.”
Another trade topic Wyant viewed with a positive perspective is the ongoing negotiations with Japan. The gist of those negotiations would result in a similar agreement to the Trans-Pacific Partnership, only in the form of a bilateral agreement with Japan rather than a multilateral trade agreement — a result of President Trump’s personal negotiation preferences.
“I had the opportunity to interview Trump last year and he just said he really likes bilateral deals — he doesn’t like multilateral agreements and that’s his preference going forward,” Wyant said. “I think we’re going to get back to where we were under Japan with TPP and maybe even a little sweeter for agriculture.”
For Wyant, an agreement similar to TPP with Japan could continue to counter China’s influence in the region and possibly open up new markets in places like Vietnam.
“I’m hopeful that these agreements will give us some certainty in agriculture that we will be competitive on the export front,” Wyant said. “We all know that that certainty can’t come soon enough.”
Trade negotiations with China, while maybe a less positive topic than Mexico, Canada or Japan, are no less important for the future of U.S. agriculture. It’s in these negotiations that the stark cultural contrasts between countries create fissures in any future deals.
“We have to think about the basics with China: They’re a communist country, they’re in it for the long run, and they don’t have a presidential election in 2020,” Wyant said. “They can do a lot of things to manipulate their currency that we are either unable or unwilling to do.”
Where America has always prided itself over brash bartering tactics and a firm hand in business both domestically and abroad, the procedures of the past may do more harm than good in the Chinese coliseum.
“China has a very proud culture and they don’t appreciate public bashing of what they do — and we’ve done a lot of that,” Wyant said. “So it gets to be very complicated about how this Chinese trade war will play out.”
In Wyant’s discussions with trade negotiators, she said reports were mixed between reform-minded leaders representing China with understanding of the new global trading atmosphere and members of their leadership who are simply unwilling to change.
“History has taught us that [tariffs] don’t work well in the long run because they are taxes on consumers, and when taxes continue to go up, consumers spend less,” Wyant said. “It’s kind of simple to figure out that tariffs probably aren’t a good strategy however — and this is where I would beg to disagree with a lot of folks — because we’ve been watching this play out for decades and nothing has really gotten to the Chinese government.”
As the Chinese economy shows signs of weakening and problems with unrest arise in Hong Kong, the United States continues to prepare to take advantage of any opportunity for a beneficial trade agreement.
“In the meantime our producers are saying that Trump may be the guy that finally figured this out,” Wyant said. “I hear again and again while out talking to farmers that he is not your typical politician — and that is probably an understatement.”
Wyant said there has been a willingness to stick with President Trump on tariffs and see what will happen because our country has been losing out on our markets anyway.
“We’ve been stymied, we’ve been distracted, and we’ve been delayed,” Wyant said. “There are a lot of people who think the Chinese will just keep dragging their feet out on these negotiations until they see what happens with the presidential election in 2020.”
The Farm Bill seems to be a never-ending topic of discussion for politically conscious agriculturists and for Wyant, the constant attention shown to the topic is not misguided.
“I think if we hadn’t had all of the disruption and uncertainty over trade it would probably be a pretty adequate farm bill,” Wyant said. “There is more and more uncertainty over whether this is enough of a safety net — yes, we have crop insurance bigger and better than ever before but on the revenue side the ARC program and PLC — is that going to be sufficient?”
Movements from direct payments to a market-dependent system were a smart strategy to make farm payments more politically sustainable and banish some of the negative rhetoric surrounding Farm Bill fund allocations.
“We’ve moved away from land retirement and direct payments for a market-oriented farm policy,” Wyant said. “It’s been working in a way that helps support producers and is able to get the desired number of votes in Congress.”
The Renewable Fuel Standard
“Here we are with this delicate dance where the oil industry is also very strongly represented in the White House and they support these exemptions,” Wyant said. “You may remember that the Renewable Fuel Standard that was adopted 12 years ago does provide for the granting of waivers to so-called small refineries.”
Ethanol advocates were sorely disappointed when 31 additional waivers were granted to small refineries — producing under 75,000 barrels per day — for 2018. While waivers to small or economically disadvantaged refineries does not sound like a deliberately pro-oil move, it did open up debate about the legitimacy of the program when notable companies like Exxon were among the refineries receiving the waivers.
“This was like a stab in the heart to everybody who has been thinking Trump is pro-ethanol or Trump is pro-renewables,” Wyant said.
While the move discouraged ethanol advocates, Wyant said she believes the negative outpouring from renewable fuel supporters has opened up discussion and increased the President’s awareness of the issue for the future.
For Wyant, one of the most overlooked but influential topics for agriculture on Capitol Hill is President Trump’s impact on the judiciary system — particularly in environmentalist-heavy arenas like San Fransisco’s Ninth Circuit.
“There are a lot of activist groups that can probably get something passed in the House controlled by Democrats, but it’s not going to go anywhere in the Senate,” Wyant said. “So what do they do? They sue.”
Lawsuits focusing on odors, pollution, animal welfare, endangered species and more are all heard in the Ninth Circuit system, and it has become an especially successful location for those lawsuits due to the abundance of appointments President Obama made in that circuit. Examining President Trump’s appointments, particularly in that court system, reveals a plan to change the way activists groups can sue.
“You can watch President Trump’s Twitter feed and question what he is really up to, what the strategy is,” Wyant said. “But when you look at his judicial appointments, his strategy is clear.”
Wyant said President Trump understands the importance of judges for a common-sense approach. For agriculture, Trump’s appointments mean anti-agriculture groups could lose a vital outlet.
“In less than three years of his first term, Trump has appointed two Supreme Court Justices, 43 judges to the U.S. Court of Appeals, 99 to the U.S. District Courts, and two judges to the Court of International Trade — all lifetime appointments,” Wyant said. “Most of these people could serve for 20 to 30 years.”
For comparison, at the same points in their respective terms President Obama had appointed 91 judges, and George W. Bush claimed a close second to President Trump by appointing 145 judges.
Wyant encouraged anyone invested in news or political topics similar to those she reports to get their information from trusted sources, especially when sharing their findings with friends, family and neighbors.
“So maybe you don’t agree with your relatives but maybe you can have a discussion about what this really means for the future of agriculture and the future of our country,” Wyant said. “And perhaps we can find some common ground somewhere along this increasingly polarized pathway that we’ve been on.”