President Donald Trump today signed off on a plan to punish China for years of stealing intellectual property by imposing about $60 billion worth of tariffs on Chinese goods. The much anticipated and feared move came despite a growing chorus of warnings from Capitol Hill and farm groups that the new duties will spark a trade war and China will retaliate by taxing or blocking U.S. agricultural goods.
U.S. Trade Representative Robert Lighthizer spent about six hours in hearings today and Wednesday, much of the time addressing farm-state lawmakers’ fears that China would hit back and that U.S. soybean exports would be the primary target.
“Given that China is the second-largest export market for American farmers and ranchers, the pain from retaliation could be significant,” said Brian Kuehl, executive director of Farmers for Free Trade. “In fact, state-run Chinese media has already indicated that American soy exports could be targeted. That would mean that the nearly $14 billion in annual soy exports from American farmers could face an immediate tax.”
Lighthizer, who testified today before the Senate Finance Committee and Wednesday in the House Ways and Means Committee, did not try to convince lawmakers that agriculture would not be hurt, but said the pain is the price that must be paid to punish China and protect U.S. intellectual property “for the national good.”
“It’s something we’re worried about,” Lighthizer said in a response to criticism from Sen. Pat Roberts, R-Kan. “It is unfair, in my judgment, that farmers … would be singled out in this. Having said that, it’s not possible to take the position that because of soybean farmers, we’re not going to stick up for our rights in a whole variety of ways and have hundreds of billions of dollars' worth of other exports and domestic producers punished because of unfair trade.”
That did not satisfy Sen. Claire McCaskill, D-Mo., who said “it doesn’t feel like it’s for the national good to soybean farmers.”
The USTR will now have 15 days to produce a list of Chinese products to be targeted with as much as $60 billion in tariffs. Lighthizer said today that Chinese agriculture and aerospace equipment will likely be on that list.
American Soybean Association President John Heisdorffer criticized Trump's action.
“If there was any question about the likelihood of retaliation by China after previous actions by the administration to protect domestic manufacturers, that doubt was erased today,” said Heisdorffer. “American soybean producers oppose this decision by the administration that puts exports of our soybeans to China in jeopardy.”
Roberts said today that he and Sen. Debbie Stabenow, D-Mich., agree that Congress will likely have to come up with some form of assistance for farmers who lose business because of Chinese retaliation.
“If we continue down this road, we may have to consider some kind of payment on a case-by-case basis," Robert said.
Roberts floated the idea of calling such aid “Trump Tariff Payments,” or TTP.
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