By Chris Adams
In 2018, the U.S. economy is booming, with unemployment low, the stock market healthy and growth continuing.
But for farmers, things are uncertain. Why? In a word: tariffs.
In a session with National Press Foundation fellows, Patrick Westhoff of the University of Missouri laid out the basics of the trade war that’s hurting shipments of soybeans – a staple of farm states such as Iowa. Westhoff is director of the school’s Food and Agricultural Policy Research Institute, which analyzes the farm economy and how it is affected by U.S. and international government policies.
The tariffs aren’t the only thing on the plate for farmers in 2018. Congress is also working on a reauthorization of the farm bill, the massive piece of legislation that sets subsidies, loan rates, crop insurance and other policies that dictate the year-to-year lives of farmers around the nation.
Westhoff gave a primer of how the farm bill and how it has changed over time (it is reauthorized by Congress every five years or so). He also discussed the politics behind it, and how it confounds typical red-state, blue-state patterns.
He also reminded the fellows that the farm bill is much more than just for farmers; it’s also the Supplemental Nutrition Assistance Program, the U.S. Department of Agriculture program commonly referred to as food stamps.
If the trade wars continue to heat up and pull in more commodities, could things get as bad as they were in the 1980s, a time of farm foreclosures and suicides?
According to Westhoff, “It’s not the 1980s, but….”
One worrisome sign: Farm debt-to-asset ratios have been increasing since 2012, even as interest rates are far lower now than in the 1980s. Interest rates are expected to rise, causing a concern because debt-to-asset ratios are already on the way up.