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Trump has only distributed a fraction of promised bailout funds for farmers hurt by tariffs

Less than $900 million of a $12 billion bailout program has actually been given to U.S. producers.

The Trump administration has distributed less than $900 million from a $12 billion bailout program it promised farmers hurt by the president's ongoing trade war, The New York Times reported this week. (Photo credit: NOVA SAFO/AFP/Getty Images)
The Trump administration has distributed less than $900 million from a $12 billion bailout program it promised farmers hurt by the president's ongoing trade war, The New York Times reported this week. (Photo credit: NOVA SAFO/AFP/Getty Images)

The Trump administration has distributed only a fraction of the money it promised farmers hurt by the president’s ongoing trade war, The New York Times reported Monday.

According to officials from the Department of Agriculture (USDA), just $838 million of a promised $12 billion bailout program for farmers affected by tit-for-tat tariffs has been paid out since September, when the administration made half the funds available. The remaining $6 billion is expected to be made available in December.

The Times writes that the program has been plagued by “bureaucracy as well as practical challenges” since its inception. Farmers are often told they must wait until they complete their harvests before applying for bailout funding, a process that’s been slowed by poor weather conditions, and even then, receive far less than they might get during normal years.

Meanwhile, the Times notes, net farm income in the United States is expected to fall by $9.8 billion this year — a 13-percent decline from the same time last year.

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Agriculture Secretary Sonny Perdue has also said it is unlikely any additional funding will be offered beyond the $12 billion, even if the money is eventually distributed in its entirety. “Farmers are very resilient and adept in making their planning and marketing decisions based on the current market,” he told reporters in October.

The bailout program was initially announced earlier this year in July and is comprised of a Market Facilitation Program, a food purchase and distribution program, and an Agricultural Trade Promotion program, which aims to “develop foreign markets for U.S. agricultural products.”

Under the Market Facilitation Program, producers of corn, cotton, dairy, hog, sorghum, soybean, and wheat who earn less than $900,000 per year are eligible to receive federal funding to mitigate “trade damages” sustained under current tariffs.

The government also says it will purchase excess goods such as dairy, beef, pork, apples, oranges, potatoes, and more from U.S. farmers, and distribute the goods to food assistance programs like the National School Lunch Program, the Emergency Food Assistance Program (TEFAP), and elderly feeding programs such the Commodity Supplemental Foods Program, according to USDA guidelines.

Already, the bailout has come under scrutiny for the way it prices individual commodities. The Times notes that dairy farmers in particular have become frustrated by a shortage in aid.

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According to the National Milk Producers Federation, dairy farmers have received just $127 million in bailout money, even as they predict a total 2018 loss of $1.5 billion.

“As farmers, we appreciate the President’s sincere desire to help. Still, the USDA’s approach has resulted in only $127 million in market facilitation payments, or $0.12/cwt., on one-half of our annual production,” NMPF chairman Randy Mooney wrote in a letter to Perdue’s office this past October. “Based on [our] analyses…this falls far short of the losses dairy producers have faced.”

Earlier in January, following President Trump’s decision to impose a 30-percent tariff on Chinese solar panels and a 20-50 percent tariff on washing machines, China responded in kind by slapping tariffs on $3 billion worth of American goods, including a 25-percent tariff on pork products, and a 15-percent tariff on goods such as fresh fruits, dried fruits, and nut products. In June, following yet another round of U.S.-imposed tariffs on up to $34 billion in goods, China retaliated once again, hitting the U.S. with massive tariffs on soybeans, corn, beef, and dairy.

The decision to target U.S. soybeans in particular hit American farmers hard. With China looking elsewhere for imports, such as Brazil, and focusing on developing its own farmland further, U.S. soybean sales to China have plummeted 94 percent in the last year alone. Even with help from federal subsidies, farmers have been able to recoup just a fraction of their profits, and some say they will soon need to lay off workers.

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“We don’t want a handout. We want trade. We want to sell the crop,” one soybean farmer, Lynn Rohrscheib of Illinois, told the Times. “We were all really supportive at the beginning. We figured we didn’t know all the facts and something would happen and this won’t be a long-term thing. Now it looks like this is going to be a several-year thing and people are getting frustrated.”

The Trump administration itself admitted the trade war would likely hurt American farmers, but claimed the issue would resolve itself eventually.

“We’ll make it up to them,” Trump told reporters in April. “The farmers will be better off than they ever were. It will take a little while to get there, but it could be very quick, actually.”

He added that China’s decision to target farmers to get back at him for the U.S.-imposed tariffs wasn’t “nice.”