Trump's tough trade moves could backfire in Trump country
As this November's hard-fought US midterm elections approach, Donald Trump's trade confrontation with China represents a glaring liability for the US president and agricultural regions that supported him in 2016.
After the president this month unveiled tariffs on scores of billions of dollars in global steel and aluminum imports as well as Chinese technological goods, major US trading partners vowed to retaliate.
Should talks to resolve the impasse fail, Beijing has produced a list of 128 American products, including fruits and pork, which will be subject to retaliatory tariffs designed to cause pain in Republican areas.
Any scenario in which China retaliates will involve "very red states and agriculture," according to Monica de Bolle, a senior fellow at the Peterson Institute for International Economics.
The European Union meanwhile has also shown it knows how to hit where it hurts, identifying US exports of tobacco, bourbon, rice, orange juice, peanut butter and Harley-Davidson motorcycles as products liable to face duties.
For the moment at least, Washington is in talks with Beijing and Brussels.
"Trade talks going on with numerous countries that for many years have not treated the United States fairly," Trump said Monday evening on Twitter. "In the end, all will be happy!"
But the knives could still come out.
"At some point, they could use the big guns and put soybeans on the table," said de Bolle. "It hurts the reddest of the red states. They have the potential to be very disruptive."
American farmers have captured a third of the soybean market in China, which is the largest export destination for US soybeans. In states like Kansas, Chinese retaliation could leave usually reliable Republican voters smarting.
Beijing has also announced a possible 25 percent duty on US pork, which would be a bitter pill in a swing state like Iowa -- a state carried by Republican presidents only twice since 1988 and which Trump won in 2016 on the back of support from farm workers.
- Payback -
If trade talks head south, disaffected Trump voters could simply sit out the following elections.
"It will certainly harm the Republicans in the midterms if there is massive retaliation by other countries that harms US agricultural interests especially," said Edward Alden, a trade policy expert at the Council on Foreign Relations.
"But I think the president will try to avoid that."
Americans have already witnessed the effects of targeting exports from politically sensitive areas.
In 2002, President George W. Bush had to end tariffs on steel imports after the European Union put counter-tariffs on oranges from Florida, a state where his highly contested margin of victory had famously been only a few hundred votes.
Senator Chuck Grassley, a Republican of Iowa, points to another case: a ban on grain exports to the Soviet Union under President Jimmy Carter, which led to an immediate 10 percent drop in exports from his state.
"That's 38 years ago but that's still in the memory of farmers," Grassley said during Thursday's testimony from US Trade Representative Robert Lighthizer.
But in risking retaliation from US trade partners, Trump is hewing to campaign pledges to get tough on unfair foreign trade -- pledges that helped put him over the top in key swing states like Michigan, Wisconsin and Pennsylvania.
Trump's trade team also insist they are acting in the best interests of struggling American industries and workers.
Lighthizer said the US could not deal with Beijing while representing only the interests of soy farmers, who account for $14 billion out of $130 billion in annual exports to China.
"Trump's gamble is that the voters will like the fact that he is standing up to China on trade," said Alden of the Council on Foreign Relations.
"He is taking a tough stand, which is popular in many places in the country that were hard hit by imports."
© 2018 AFP