Think trade wars are easy to win? Think again.
The Independent reports
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President Donald Trump’s ‘America First’ trade policies have led to a 94 per cent cut in US soybean exports to China, forcing farmers in America’s midwest to stockpile crops and hope relief comes before the rot.
After decades in which American soybean farmers were able to build considerable business by selling a huge share of their crop to China, farmers across the US are seeing the largest market destination for one of the country’s largest crops drying up.
“We’re sitting on the edge of our seat,” Kevin Karel, the general manager of the Arthur Companies, a soybean seller, told The New York Times. Mr Karel’s company has begun stockpiling soybeans outside, and they plan on laying a tarp over the product to extend its life. He said he hopes a solution can be found before that crop rots.
This Tweet by Brad Setser sums up the current state of affairs in a single Tweet.
Doing a bit of digging into the Chinese trade data.
As @gilliantett noted on Friday, Chinese exports to the US (in the Chinese data) have been doing quite well in the last few months.
Running about $5b a month more than this time last year, and $10b more than this time 2y ago pic.twitter.com/4UdKTyV2FD
— Brad Setser (@Brad_Setser) November 18, 2018
Not to fear. I have it on good authority that trade wars are good and easy to win.
When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!
— Donald J. Trump (@realDonaldTrump) March 2, 2018
