As Donald Trump stomps around Asia schizophrenically kissing China’s backside while yelling at our foreign trade partners about how they’re taking advantage of poor, weak America, farm groups are mobilizing to keep Trump from ripping up NAFTA. Il Duce thinks threatening to withdraw from NAFTA is a good negotiating tactic; everyone else, including, it seems, his own negotiators, think he’s being entirely unreasonable.
Dozens of Big Ag organizations and companies, including CHS Inc., Deere & Company, Land O’Lakes, the National Corn Growers Association, and the South Dakota Grain and Feed Association, are formally rebutting Commerce Secretary Wilbur Ross’s claim that repealing NAFTA won’t hurt the U.S. economy. State agriculture secretaries are helping amplify the industry’s message that the Trump Administration is forgetting about rural America’s real economic interests.
South Dakota’s Secretary of Agriculture Mike Jaspers says South Dakota needs NAFTA:
Originally negotiated in the early 1990s, NAFTA resulted in more opportunities for U.S. farmers and ranchers to sell their products to consumers across the continent. Since NAFTA was signed, U.S. exports to Canada and Mexico have grown from less than $9 billion to $38 billion, a more than four-fold increase. This has meant money in the pockets of U.S. producers—money that they are able to use to support businesses in towns large and small across the country, bolstering the rural economy.
…While I believe that we should always be looking to improve, I also know how beneficial NAFTA has been for producers right here in South Dakota. It is imperative that we have a trade agreement with our two most important trading partners. Equally important though is ensuring that any newly negotiated NAFTA truly be a step forward for South Dakota agriculture, improving on the many opportunities we currently enjoy under NAFTA [Secretary of Agriculture Mike Jaspers, press release, 2017.11.09].
Secretary Jaspers is on the same page with his California counterpart, who warns NAFTA withdrawal will hurt millions of Americans:
President Donald Trump revving up talk of the U.S. pulling out of the North American Free Trade Agreement should worry California farmers, the state’s agricultural secretary said Thursday in Fresno.
“There’s a big difference in walking away from a deal when it’s your company, your capital, your employees, your family’s reputation. This is millions of businesses and millions of families that will be affected. I’m very worried,” Secretary Karen Ross said of the longstanding trade deal with Mexico and Canada [David Castellon, “California Ag Secretary: Trump Threat to NAFTA Should Worry Farmers,” The Business Journal, 2017.11.10].
Academics share the concerns of industry and state officials. Ending NAFTA would trickle down to higher costs for fuel and consumer goods:
Neil Meredith, associate professor of economics and Dana Professor of Business at West Texas A&M University, said increased prices for producers, created by a withdrawal or termination of NAFTA, would likely be passed along to consumers at the end of the day.
“For example, the United States imports more oil from Canada than any other foreign country in the world,” he said. “Higher oil prices would translate into higher gasoline prices at the pump locally”
Even local bars would be impacted by pulling out of NAFTA, he said.
“Restaurants that sell margaritas would also have to pay higher prices for the tequila used in making their margaritas,” Meredith said[Robert Stein, “Amarillo Area Ag, Business Experts Say Pulling out of NAFTA Would Have Negative Impact,” Amarillo Globe-News, 2017.10.16].
If Trump nukes NAFTA, farmers will need more than a stiff drink. Iowa State University economist Dermot Hayes says NAFTA withdrawal could push our already weak farm economy into a Depression:
U.S. threats to pull out of longstanding trade agreements with Mexico and Canada could drag Iowa’s ag industry into another depression, some state farm leaders say.
“We’re not doing that well now, so any more bad news could push us over the edge,” said Dermot Hayes, an Iowa State University economist [Donnelle Eller, “Could NAFTA Withdrawal Push Iowa into Another Farm Crisis? Ag Leaders Say It’s Possible,” Des Moines Register, 2017.11.10].
Trump opened his tenure in the White House saying the era of forgotten men and women was over. Those were, of course, just words, with no bearing whatsoever on Trump’s daily course of saying whatever he wants to make himself feel tough and popular. In threatening to tear up NAFTA, Trump puts his own ego, only faintly informed by the constant jingoistic racket of Fox & Friends playing throughout the White House, over the real concerns of agricultural interests in South Dakota and across the country. Rural America, food producers, welcome to the ranks of Trump’s forgotten Americans.