America needs more free trade, not tariffs aimed at bailing out American farmers
What President Trump and his administration have accomplished since taking office is nothing short of remarkable. From the historic rollback in regulations to the Trump tax cuts, our nation’s economy is picking up steam in ways not witnessed in almost two decades.
But the successes of the Trump administration, particularly the economic gains from tax reform, may all be coming to a startling halt. The protectionist rhetoric and the impending trade war with China are threatening American jobs and could lead to higher costs for American consumers.
{mosads}Tariffs are taxes paid by Americans. The victims of the impending trade war reach beyond companies like auto-manufacturers whose workers are already suffering job losses. Our nation’s farmers are now the most recent sector to feel the burn of potential tariffs as China recently announced plans for additional tariffs on commodities ranging from pork to soybeans to fruit and nuts.
In response, the Trump administration is reportedly considering crafting a financial bailout for farmers. The specifics remain to be determined, but let’s be clear— a special interest handout to certain sectors of our agriculture industry would ultimately make our nation’s fiscal outlook worse, not better.
Such a precedent would open the flood gates for carveouts and special treatment. For example, why stop at bailouts for the agriculture industry? What about other sectors (and individuals) who are already being harmed, either through job losses or higher prices, as a result of the talk of tariffs. Would every sector receive a comparable government handout to what the agriculture industry may receive? Where would the handouts end?
The answer is they should never begin. History is littered with examples of such failed industrial policies and teaches that the entire economy slows when businesses compete for government handouts. Furthermore, from a fiscal standpoint, the handouts and subsidies would compound the disastrous spending seen in the $1.3 trillion omnibus boondoggle. As Congress and President Trump look to claw back provisions of the omnibus spending bill, the last thing they should be coupling that with is more subsidies for a favored sector like agriculture.
This is particularly true considering our country’s $21 trillion in debt. That’s over $64,000 owed per citizen. And with the passage of the recent $1.3 trillion omnibus, the government will also have continual $1 trillion annual deficits. That kind of spending would make even liberal spendthrifts blush.
Even if this agricultural bailout was offset by reducing spending in other areas that would only be maintaining — not cutting — our nation’s status quo spending habits. Congress and the administration must look for ways to cut spending, not grow government welfare programs.
Setting aside the mechanics of the agriculture handout, the policy still creates a terrible precedent for the GOP, a party which claims to believe in government not picking winners and losers. Creating special carveouts for farmers would achieve the opposite. And as our nation enters an election cycle, what message does this send to voters? They can spot this sort of hypocrisy from a mile away.
Congress and President Trump should stick with the successes they have already had in reducing taxes and regulations. Where the Trump tax cuts bring economic growth, tariffs on China and welfare for farmers will drive our nation further into debt. A feast of new spending with a farm bailout is a special interest handout and would only further compound the problem. The answer is not handouts for those harmed by the tariffs. The answer is no to tariffs and bailouts and a resounding yes to free trade.
Former Rep. David M. McIntosh is president of the Club for Growth, a nonprofit group aimed at reducing government and promoting fiscal responsibility.