Tuesday, July 24, 2018

To Ease Pain of Trump’s Trade War: $12 Billion in Aid for Farmers

The Trump administration on Tuesday announced up to $12 billion in emergency relief for farmers hurt by the president’s trade war, moving to to insulate food producers from looming financial losses that would be a direct result of President Trump’s policies. The aid to farmers, announced by the United States Department of Agriculture, will come through a direct assistance program, one designed to help with food purchase and distribution and one specifically geared toward promoting trade. The move is an indication that Mr. Trump — ignoring the concerns of farmers, their representatives in Congress, and even some of his own aides about the adverse consequences of a trade war he says he relishes — plans to plow forward in escalating his tariff tit-for-tat around the world...The European Union, Canada, Mexico, China and other countries have responded to Mr. Trump’s tariffs on steel, aluminum and $34 billion worth of Chinese products by imposing taxes of their own. They have often chosen to target farm country, the source of some of America’s biggest exports and an important political base for the president. American soybeans, pork, sugar, orange juice, cherries and other products now face tariffs in foreign markets that make their products less desirable...As part of the program announced on Tuesday, the department will draw on the financial resources of a program known as the Commodity Credit Corporation, which helps shore up American farmers by buying their crops. The initiative, which does not authorize any new money and thus not need approval from Congress, was a way for Mr. Trump to tamp down criticism of his trade policies. But it was also an unmistakable signal that the president has no plans to lift his tariffs any time soon, as Farm Belt senators have pleaded...MORE

This is so typical and serves as a good example of how our government operates, i.e. one bad policy or government intervention leads to more bad policies and more interventions.

Economist Ludwig von Mises spotted this way back in 1929:

Authors of economics books, essays, articles, and political platforms demand interventionistic measures before they are taken, but once they have been imposed no one likes them. Then everyone—usually even the authori­ties responsible for them—call them insufficient and unsat­isfactory. Generally the demand then arises for the replace­ment of unsatisfactory interventions by other, more suitable measures. And once the new demands have been met, the same scenario begins all over again.

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