Support NeoGAF

[12Goblins]

https://www.bbc.com/news/business-44945112

The US has unveiled a $12bn (£9.1bn) plan aimed at helping US farmers hurt by the intensifying trade war.

The aid is intended to protect the industry as countries raise taxes on US products such as soybeans in response to new Trump administration tariffs.

The US plans to provide subsidies to farmers and buy unsold crops, among other measures.

Donald Trump had promised the aid after fierce criticism from farmers, an important part of his support base.

Mr Trump has said his tariffs - which he earlier described in a tweet as "the greatest" - are intended to pressure countries to change their policies toward US exports.

But the agriculture industry, which draws about 20% of its income from exports, said the president's approach is hurting demand for its goods and causing long term damage to relationships with buyers.

Prices for soybeans have already fallen by more than 15% since April, when China - a major buyer of the crop - announced its plans to retaliate.

ok boys, how are we going to go about not interpreting this as an act of welfare?

 

[LordPezix]

ok boys, how are we going to go about not interpreting this as an act of welfare?

You don't, it is.

If this didn't happen the market equilibrium would force some farmers out of business until it re balanced into the most efficient model of itself.

 

[Harksteed]

Trade War Welfare

 

[12Goblins]

To avoid cognitive dissonance, I was thinking about we either

1. stand by our principles (lol) and condemn the farmers for doing nothing but reaching out for handouts. after all, what have they done for me?

or 2. call them freedom payments

 

[Drake]

I'm a Trump fan, but I will admit I think the tariff's are a really bad idea. They protect a few certain industries and it hurts the rest of the American people.

 

[DunDunDunpachi]

Farmers already receive a significant amount of subsidies and bailouts. It goes hand-in-hand with the food regulations.

Packaged food will sharply decline in the next 50 years anyway. The way we mass-produce food is too unhealthy and too fuel-hungry. People will gravitate to more local and home-grown food. The ones that disagree will be dead within 50 years anyway due to obesity and cancer.

 

[TrainedRage]

I'm ok with this. If its temporary. Living in the midwest its easy to see how this would help out a great deal.

 

[Trogdor1123]

Well that's 37 bucks for every man woman and child in the states... It's only the start to I bet.

 

[TheShadowLord]

Farmers already receive a significant amount of subsidies and bailouts. It goes hand-in-hand with the food regulations.

Packaged food will sharply decline in the next 50 years anyway. The way we mass-produce food is too unhealthy and too fuel-hungry. People will gravitate to more local and home-grown food. The ones that disagree will be dead within 50 years anyway due to obesity and cancer.

not if the food industry has their way. I find myself to be pro gmo and would haven't a problem of eating gmo foods or lab grown meat/fish. But these corporations would never allow it.

 

[Alfadawg]

Smells like Socialism to me...

 

[All Hail C-Webb]

It's pathetic, American taxpayers will be responsible for bailing out the President, mere months after he created these problems.

Were not bailing our the farmers, he doesn't give a shit about them. He's trying to buy their votes and make us pay for it.

He couldn't get the Mexicans to do it, so instead he'll have us do it. The art of the deal.

 

[Gander]

MAGA

 

[Ke0]

The conservative mantra of "Let the market decide" apparently comes with a bunch of exceptions.

 

[off duty ninja]

Wow, you really trolled all these Trump supporters coming into this thread with their disingenuous one liners and bullshit rhetoric. Oh wait, that's not what's happening in here is it?

 

[12Goblins]

Wow, you really trolled all these Trump supporters coming into this thread with their disingenuous one liners and bullshit rhetoric. Oh wait, that's not what's happening in here is it?

I mean, you have to point out the hypocrisy or else they won't see it

 

[PkunkFury]

rural areas have much more voting power, so yeah, buying their votes is a great strategy for the Republicans

not that moving money from your economic hubs to the areas that are disappearing will have any detrimental effect on the country or anything. Great to see the people who didn't vote for this mess will be the ones paying for it...

 

[HoodWinked]

China loves them soybeans, they made up more than half the demand. the 12billion subsidy is pretty much exact to cover for the loss in China. But even then its not like the soybeans vanish, they would be used for oil or animal feed, so its basically just subsidizing our own meat production.

http://www.nopa.org/resources/datafacts/top-10-destinations-u-s-soybean-exports-2015-2017/

Trade wars are not unilateral, US farmers get fucked but they're bailed out, Chinese exporters also get fucked much worse cause you cant eat a iphone and China will likely bail them out as well. But China would have to make up a loss in $460 Billion, where as US have to make up a loss in $115 Billion.

 

[infinitys_7th]

To avoid cognitive dissonance, I was thinking about we either

1. stand by our principles (lol) and condemn the farmers for doing nothing but reaching out for handouts. after all, what have they done for me?

or 2. call them freedom payments

It's not really welfare when the government fucks up and takes the money out of their hands in the first place.

Calling this welfare is like calling the government seizing a thief's assets to repay his victims "welfare".

 

[Phoenix RISING]

Yall really expect the Cult of #45 to hold him accountable, huh?

 

[infinitys_7th]

Yall really expect the Cult of #45 to hold him accountable, huh?

I mean, the tariffs are stupid, but subsidizing them while we put the screws to our enemies abroad in trade is fair.

 

[PkunkFury]

I mean, the tariffs are stupid, but subsidizing them while we put the screws to our enemies abroad in trade is fair.

why not skip the middleman and subisidize the industries the tariffs were meant to fix instead?

Legit curious, I don't understand trade very well and don't have the time to look up the answer right now. Isn't the whole point of the tariffs to encourage growth of dying US industries due to subsidized foreign competition?

I'm probably grossly oversimplifying, but it seems now we are stuck with paying higher prices for tariffed goods or purchasing inferior domestic versions since domestic companies haven't yet had an influx of cash to improve their products, plus we are subsidizing industries we don't even care about as a country (soybeans) to keep those industries afloat.
Get rid of the tariffs and put 12bn tax payer money into our manufacturing sectors via infrastructure/special projects, and we would improve our own technology, improve our infrastructure, and employ our people, while still selling soybeans to those who want them

Trump makes the best deals though, so I'm sure I'm missing something

 

[norm9]

Trade wars are easy. Where's my handout?

 

[DunDunDunpachi]

not if the food industry has their way. I find myself to be pro gmo and would haven't a problem of eating gmo foods or lab grown meat/fish. But these corporations would never allow it.

I don't think "the food industry" is so big and ubiquitous that it'll strangle any attempts to do things a different way. Certain market forces will push us to buy local anyway. The USA is becoming more isolationist. Numerous modern countries are becoming more isolationist. We are sick and dying because of quality-control problems with our food but this comes alongside plentiful supply, so it's keeping us from starving but not exactly making us healthier. Soon the health problems in our diet will outweigh (literally 'cause lolobesity) the convenience of fast-food chains and boxed TV dinners. I believe 70% of Americans -- male or female -- are considered Overweight? And the subset of that group that are obese is at 35%? Crazy. We spent the last 40 years crying about the divorce rate while the obesity rates skyrocketed... It's happening in other countries, too, not just ours. It appears to be a natural side-effect of industrializing a country's food supplies to the point where many people can afford to eat in excess for cheap.

Food Corporations won't have much of a say as to what is or isn't allowed. Their market is quite literally dying out. It's like an alternate-universe version of what happened with cigarette companies; obesity even has its own proposed "fat taxes".

 

[Vicetrailia]

This was obvious, helps lower processing for tariff exemption submissions as well.

 

[Airola]

Great!
Farmers and doctors are the two most important occupations people can have. They should both be funded, or if not funded, then greatly helped by the state.

 

[All Hail C-Webb]

Great!
Farmers and doctors are the two most important occupations people can have. They should both be funded, or if not funded, then greatly helped by the state.

They already receive plenty of federal assistance.
This is happening entirely because of the predicament that the multiple times over, failed businessman put them in.

 

[Airola]

I don't think "the food industry" is so big and ubiquitous that it'll strangle any attempts to do things a different way. Certain market forces will push us to buy local anyway. The USA is becoming more isolationist. Numerous modern countries are becoming more isolationist. We are sick and dying because of quality-control problems with our food but this comes alongside plentiful supply, so it's keeping us from starving but not exactly making us healthier. Soon the health problems in our diet will outweigh (literally 'cause lolobesity) the convenience of fast-food chains and boxed TV dinners. I believe 70% of Americans -- male or female -- are considered Overweight? And the subset of that group that are obese is at 35%? Crazy. We spent the last 40 years crying about the divorce rate while the obesity rates skyrocketed... It's happening in other countries, too, not just ours. It appears to be a natural side-effect of industrializing a country's food supplies to the point where many people can afford to eat in excess for cheap.

One of the reasons for excess availability is how much less farmers get money from their products. They have to make more and more to balance out the amount of money they are gaining less than before. Could be I'm talking out of my ass here and it isn't like that in the US but at least here in Finland it seems to be so. The amount of money the farmers get from milk for example is really low here.

Not sure where the biggest reason for all of this is though. Is it in the human condition in general or is it in industrialization or is it somewhere else. I know people demand more options and faster service so the demand is there. Then comes competition. And competition not only comes from other local farmers but also from completely other countries.

I'm pretty much of the opinion that industrialization (and advanced science in general to some extent) has been the thing that has created a downfall in many areas and the downfall came without anyone really being able to see that before it became irreversable. We can't now imagine a world without the luxuries and conveniences we have. Most of current world problems wouldn't be here if mass industrialization never happened. I perhaps could even say that about the control of electricity too. Industrialized world and electricity are pretty much our gods that keep us alive now and we can't think of getting rid or even less of any of that.

 

[davepoobond]

I mean, the tariffs are stupid, but subsidizing them while we put the screws to our enemies abroad in trade is fair.

Sure, if you’re a left leaning protectionist.

This is the antithesis of a conservative policy.

 

[DunDunDunpachi]

One of the reasons for excess availability is how much less farmers get money from their products. They have to make more and more to balance out the amount of money they are gaining less than before. Could be I'm talking out of my ass here and it isn't like that in the US but at least here in Finland it seems to be so. The amount of money the farmers get from milk for example is really low here.

Not sure where the biggest reason for all of this is though. Is it in the human condition in general or is it in industrialization or is it somewhere else. I know people demand more options and faster service so the demand is there. Then comes competition. And competition not only comes from other local farmers but also from completely other countries.

I'm pretty much of the opinion that industrialization (and advanced science in general to some extent) has been the thing that has created a downfall in many areas and the downfall came without anyone really being able to see that before it became irreversable. We can't now imagine a world without the luxuries and conveniences we have. Most of current world problems wouldn't be here if mass industrialization never happened. I perhaps could even say that about the control of electricity too. Industrialized world and electricity are pretty much our gods that keep us alive now and we can't think of getting rid or even less of any of that.

So, there two pieces to your post and I wanted to address them separately: the agriculture situation in the USA and the downsides of modern, industrialized agriculture.

I'm glad that US farmers are subsidized, not only because I enjoy their products at a cheaper price, but also because it keeps them in business and provides for their families. If I'm comfortable with providing people food stamps, unemployment benefits, and disability (and I am comfortable with all three), then why on earth wouldn't I support this for our farmers? Government regulation is also a problem: the safety standards and requirements and licenses will sometimes price farmers out of their own market, allowing big corporations to take over and buy cheap land once the local market craters. And yet, our regulation still doesn't prevent foodborne illnesses and concerns about additives and animal treatment. It feels lose-lose to me.

Concerning industrialization, I don't think it is inherently wrong. Condemning industrialization is like condemning "science" or "medicine". Industrialization are why we're here typing this conversation on a computer. It makes sense that we would make repetitive tasks easier and safer and more automated in order to produce better products for cheaper. The problems occur when this gets out of hand and other balancing factors (like human health, environmental damage, etc) are not considered. There are farmers who embrace local, self-sustaining agriculture while also operating at a level where they can make money and support their families. Perhaps this is what we need to return to? Some folks think so.

 

[Alfadawg]

China loves them soybeans, they made up more than half the demand. the 12billion subsidy is pretty much exact to cover for the loss in China. But even then its not like the soybeans vanish, they would be used for oil or animal feed, so its basically just subsidizing our own meat production.

http://www.nopa.org/resources/datafacts/top-10-destinations-u-s-soybean-exports-2015-2017/

Trade wars are not unilateral, US farmers get fucked but they're bailed out, Chinese exporters also get fucked much worse cause you cant eat a iphone and China will likely bail them out as well. But China would have to make up a loss in $460 Billion, where as US have to make up a loss in $115 Billion.

Yeah but what's going to happen in November when the new iphones are out?

There is going to be outrage but from consumers and Apple

 

[Papa]

The rule of thumb for economics is “tinker with the free market at your peril” because of the unintended consequences for incentives that generally occur. I can’t think of an example in history where a government buying oversupply of crops has worked out for the better.

BUT

They key difference here is that the perceived socialist policy is in fact a short term tactic in the trade war which is inherently capitalist. It’s a project with a clearly defined termination condition: if trade_war_won, exit loop. It’s a similar tactic to OPEC keeping oil prices artificially low to freeze natural gas producers out of the market. OPEC held all the cards in that scenario and Australian/US/Canadian natural gas producers suffered immensely or just outright died. The US holds the cards here and will win the trade war if they are willing to employ tactics like this.

Whether the end will justify the means, I’m not sure yet as I haven’t thought about it enough. I’m leaning towards yes though, because the long term benefits of winning a trade war with China (and others, but China is by far the biggest fish in the pond) would be enormous for the US economy. The risk is related to physical conflict, but I don’t know enough about that to comment on the likelihood or consequence.

 

[Papa]

Yeah but what's going to happen in November when the new iphones are out?

There is going to be outrage but from consumers and Apple

I would guess that most Apple consumers don’t vote republican anyway.

 

[Alfadawg]

And that's the issue with Trump and his identity politics.

 

[Arkage]

Trade wars are not unilateral, US farmers get fucked but they're bailed out, Chinese exporters also get fucked much worse cause you cant eat a iphone and China will likely bail them out as well. But China would have to make up a loss in $460 Billion, where as US have to make up a loss in $115 Billion.

This trade dispute likely won't get that far. Even so, saying "the government will bail out farmers" just means the cost is pushed onto US tax payers when we're already running record deficits due to the giant tax cuts for the wealthy that Republicans pushed through. And this doesn't address the other point the farmers brought up, which is that it is still going to damage their relationships with buyers.

The biggest problem in my view is that Trump is not only going after China, but pissing off most of our other trade allies at the same time. Going after China unilaterally is dumb, and puts America in an unnecessarily weak position. If Trump pisses off enough allies they may as well make deals with China themselves, circumventing the US entirely. And really, what is the point of all this? Does Trump really think tariffs are going to make China give better deals to the US? Because it's a near certainty that it won't. How about instead of putting a tariff on Chinese steel and then being forced to subsidize soybeans, he just subsidize American steel to begin with, and then work on the deal with China?

 

[Airola]

I'm glad that US farmers are subsidized, not only because I enjoy their products at a cheaper price, but also because it keeps them in business and provides for their families. If I'm comfortable with providing people food stamps, unemployment benefits, and disability (and I am comfortable with all three), then why on earth wouldn't I support this for our farmers? Government regulation is also a problem: the safety standards and requirements and licenses will sometimes price farmers out of their own market, allowing big corporations to take over and buy cheap land once the local market craters. And yet, our regulation still doesn't prevent foodborne illnesses and concerns about additives and animal treatment. It feels lose-lose to me.

I kinda see some mirroring there with the situation in Europe. It seems to be common for the farmers at least in Finland saying the European Union has only made things worse for them. Regulations and stuff.

Concerning industrialization, I don't think it is inherently wrong. Condemning industrialization is like condemning "science" or "medicine". Industrialization are why we're here typing this conversation on a computer. It makes sense that we would make repetitive tasks easier and safer and more automated in order to produce better products for cheaper. The problems occur when this gets out of hand and other balancing factors (like human health, environmental damage, etc) are not considered. There are farmers who embrace local, self-sustaining agriculture while also operating at a level where they can make money and support their families. Perhaps this is what we need to return to? Some folks think so.

Oh yeah, I totally get that we are writing now because of industrialization. I feel like we are both blessed and cursed by it. Industrialization (even mass-industrialization) and science and pretty much everything else aren't inherently wrong. They can all be used well and for good. But I kinda think we never even had a chance to let them be the sources for goodness and pure wellbeing in the first place. And it think it's because of our nature. We as humans can't really handle too much power. We will abuse it. I certainly am abusing lots of the conveniences industrialization and science has given us, that's for damn sure.

I absolutely love the idea of machines that help us and the idea of us getting to know all things about atoms and what lies beyond atoms. But I can't help but see the fact that I myself and others have also become lazier and unhealthier because of it. Well, not directly because of it but more like because our nature don't really mix well with all that. Most people have had to live until the point we have started to already see how much unhealthiness, pollution and destruction has come among us. We can safely now say that we should've been better with the technologies but I'm sure there aren't many people who would've been able to see it when it started. Without the knowledge of today if we would get to go back in time, I'm sure we would all ignore everything and just take all conveniences we can get.

 

[DunDunDunpachi]

I kinda see some mirroring there with the situation in Europe. It seems to be common for the farmers at least in Finland saying the European Union has only made things worse for them. Regulations and stuff.



Oh yeah, I totally get that we are writing now because of industrialization. I feel like we are both blessed and cursed by it. Industrialization (even mass-industrialization) and science and pretty much everything else aren't inherently wrong. They can all be used well and for good. But I kinda think we never even had a chance to let them be the sources for goodness and pure wellbeing in the first place. And it think it's because of our nature. We as humans can't really handle too much power. We will abuse it. I certainly am abusing lots of the conveniences industrialization and science has given us, that's for damn sure.

I absolutely love the idea of machines that help us and the idea of us getting to know all things about atoms and what lies beyond atoms. But I can't help but see the fact that I myself and others have also become lazier and unhealthier because of it. Well, not directly because of it but more like because our nature don't really mix well with all that. Most people have had to live until the point we have started to already see how much unhealthiness, pollution and destruction has come among us. We can safely now say that we should've been better with the technologies but I'm sure there aren't many people who would've been able to see it when it started. Without the knowledge of today if we would get to go back in time, I'm sure we would all ignore everything and just take all conveniences we can get.

Have you read the works of Leo Tolstoy or John Ruskin? I feel like both of those men warned about the dehumanization of industry very accurately. They offer alternatives. They had ideas about ways to benefit from industrialization while keeping its ills at bay. I recommend reading them. I have also seen the problems caused by industrialization, but I also don't see anyone offering viable alternatives. I think it's easy to say "look at how industry has failed us" and much harder to say "how can we improve on what is good while reducing the negative facets of modern mass-industry?"

I don't think all regulations are bad. Merely that some are good and some are bad. For instance, I wish every State taxed out-of-state produce. It would drive business and competition into the local markets while not totally shutting out the other states. It would go toward repairing the roadsystem which long-distance hauling is wearing out faster. If you can grow (for instance) potatoes so cheaply that you can undercut my local prices while still paying the taxes, then you deserve to compete in that market.

 

[infinitys_7th]

Sure, if you’re a left leaning protectionist.

This is the antithesis of a conservative policy.

No, I'm a pragmatic Libertarian. If the government screws someone over, the government should compensate them.

We give the government taxes for basic protections, and if we don't pay those taxes the government can shoot us. That implies the government has an obligation to make right what they negatively impact due to their ability to use force against us.

That is the same logic by which I am okay with the US fighting ISIS while being against other interventions - US governmen intervention made ISIS in the first place, and further interventions let it spread. It's only fair that the US government then be obligated to fix its mess.

 

[infinitys_7th]

why not skip the middleman and subisidize the industries the tariffs were meant to fix instead?

Legit curious, I don't understand trade very well and don't have the time to look up the answer right now. Isn't the whole point of the tariffs to encourage growth of dying US industries due to subsidized foreign competition?

I'm probably grossly oversimplifying, but it seems now we are stuck with paying higher prices for tariffed goods or purchasing inferior domestic versions since domestic companies haven't yet had an influx of cash to improve their products, plus we are subsidizing industries we don't even care about as a country (soybeans) to keep those industries afloat.
Get rid of the tariffs and put 12bn tax payer money into our manufacturing sectors via infrastructure/special projects, and we would improve our own technology, improve our infrastructure, and employ our people, while still selling soybeans to those who want them

Trump makes the best deals though, so I'm sure I'm missing something

I'd rather not do either.

As I explained, I think it is fair for the government to make right what it fucks up.

 

[Woo-Fu]

I think calling this is a bailout is misleading. I think reach-around might be a more accurate term.

 

[Airola]

Have you read the works of Leo Tolstoy or John Ruskin? I feel like both of those men warned about the dehumanization of industry very accurately. They offer alternatives. They had ideas about ways to benefit from industrialization while keeping its ills at bay. I recommend reading them. I have also seen the problems caused by industrialization, but I also don't see anyone offering viable alternatives. I think it's easy to say "look at how industry has failed us" and much harder to say "how can we improve on what is good while reducing the negative facets of modern mass-industry?"

I haven't read them. Took War and Peace once from a library but didn't even start reading the book
And I have no idea what Ruskin has written.

I'm very interested in reading what people from the time of industrial revolution said about it, especially the criticism. If there's a book that deals with it I might want to check it out.

I don't think all regulations are bad. Merely that some are good and some are bad. For instance, I wish every State taxed out-of-state produce. It would drive business and competition into the local markets while not totally shutting out the other states. It would go toward repairing the roadsystem which long-distance hauling is wearing out faster. If you can grow (for instance) potatoes so cheaply that you can undercut my local prices while still paying the taxes, then you deserve to compete in that market.

Yeah, I wouldn't want to completely get rid of importing and exporting stuff even internationally, even with food. I like that there is a possibility for that but I think locality should be encouraged. What you said sounds the perfect way to do it, at least in the US, it seems.

 

[Phoenix RISING]

I think calling this is a bailout is misleading. I think reach-around might be a more accurate term.

That's still too politically correct.

This is socialism.

 

[Battersea Power Station]

Just curious as I don't actually know about budget allocation and such: is there any chance the money for this bailout is borrowed from China?

 

[Atrus]

I cannot wait to see more winning, especially if Trump goes ahead with auto tariffs on top of the steel tariffs.

 

[Forthefuture]

Something something bootstraps, personal respondibility etc.

Democrats should really look into bribing for votes too. I hear it works great in other certain "democracies".

 

[black_13]

Is this finally concrete proof the tariffs were a terrible idea? And more importantly isn't government bailouts exactly what conservatives in general hate?

 

[NahaNago]

This is a trade war so it makes sense for now to bail out those that are getting hit by it.

 

[TheLaughingStock]

Just curious as I don't actually know about budget allocation and such: is there any chance the money for this bailout is borrowed from China?

No.


When the US or many other countries spend money to address a crisis or subsidize farmers no one calls up China to ask for a loan or if it's ok.

China receives US dollars from the US govt and its financial institutions. Then they virtually always leave that money in US bank accounts or invest it in other dollar-denominated assets with varying amounts of risk under US law. They could buy more goods and services to reduce their trade surplus with the US but China follows mercantilism and believes trade surpluses are inherently good if possible.

 

[Woo-Fu]

Democrats should really look into bribing for votes too.

They know how to bribe too, they just bribe the people who can't be bothered to vote in the first place.

 

[KonradLaw]

Lol. Trump wrote on Twitter he proposes no-tarrifs and no subsidies between EU and USA. I don;t think he realizes that without subsidies large part of american farming would go bancrupt (for example the entire dairy industry would).

 

[TheLaughingStock]

Lol. Trump wrote on Twitter he proposes no-tarrifs and no subsidies between EU and USA. I don;t think he realizes that without subsidies large part of american farming would go bancrupt (for example the entire dairy industry would).

If you keep subsidies, non-tariff barriers and tariffs around then trade is not really free. How do you square that circle even if your goal is to protect people from bankruptcy? It's a rigged game with winners and losers determined by the gov't if no one is willing to strip out all the preferential treatment. Trump wants to MAGA.

I guess when faced with the prospect of markets putting certain people out of business, then folks who shout free trade this and free market that...want a handout just like everyone else. They want big gov't to step in to prop them up, but don't want the gov't to prop you up because they're not the ones getting hurt.