3/22/17 • International MarketsTradeUSMCA | NAFTA

Op-Ed in The Hill: Trump trade team looking out for America’s farmers. By John Bode

Trump Trade Team Looking Out For America’s Farmers



“I’m going to rip up those trade deals,” Donald Trump said as a presidential candidate last March.

“Ruin free trade?” he continued, citing trade deficits with Mexico and China, “Why do I want that kind of trade anyway?…Who needs that kind of trade?”

His language distressed American exporters — from farmers to factory workers, millions of the nation’s best agriculture and manufacturing jobs rely on foreign markets.

One year later, with key administration personnel still awaiting confirmation, many in the trade community remain in an agitated state. Yet recently, National Economic Council (NEC) Director Gary Cohn and others on the Trump team have started meeting industry leaders to seek their input and answer questions about the administration’s trade goals. For the representatives of food and agriculture exporters, the meetings could not have been more encouraging.

First, NEC personnel were on top of the substance of the issues and demonstrated an eagerness to work with appropriate components of the administration, key congressional committees and industry stakeholders. This is a sophisticated operation.

Second, NEC personnel addressed the role of food and agriculture trade in clear, thoughtful terms. They acknowledged it has not been discussed as a priority, primarily because food and agriculture already is such a positive part of the U.S. trade portfolio.

Naturally, both candidate and President Trump’s rhetoric has focused on the horrible job losses our nation has experienced in manufacturing over the last 20 years. To solve this exceptional challenge, his team intends to expand overall exports, including food and agriculture exports.

This is welcome news. The Trump administration has been very clear that its trade objectives include reducing our trade deficit. But, trade deals are not contracts for sales. They establish ground rules for future commercial transactions.

A change in the ground rules that pares back existing U.S. export markets, even if it also opens new opportunities for other exports, would be counter to Trump’s balance-of-trade objectives, as well as economic growth.

Worse, any such reduction in exports would cost American jobs and revenue immediately, while any new export opportunities as a result of new trade deals may take years to fully realize. Markets can be closed with the stroke of a pen. Tariffs can be added in days, retail products removed from shelves in weeks.

But, successfully taking advantage of new export markets requires consumer research, distribution logistics, market promotion and sales — each of those new functions requires a combination of contracting, hiring and training staff. Thus, launching new products overseas and successfully competing in foreign markets generally takes years.

Thus, the only acceptable way to reach better trade balance is through export growth. We cannot trade away today’s economic strengths in the hopes of achieving better results tomorrow.

Without a doubt, Trump’s NEC team sees this clearly. They are focused on expanding exports as the only practical means of achieving President Trump’s objectives for economic expansion and reduction of trade deficits.

Further, they are pragmatic about trade negotiations. Do not expect them to show their cards to anyone. That means trade-sensitive businesses will have to hold on to their seats (and their patience) as the trade negotiation process works through to completion.

That patience will be easier to exercise knowing that capable professionals are pursuing rational objectives.


John Bode is president and CEO of the Corn Refiners Association.