Trump’s mounting confrontation with China also threatens to light a bonfire directly beneath the Republican Party’s last firewall against potentially significant losses in the 2018 midterm elections.
The GOP’s dominance of small-town and rural America has become the indisputable geographic foundation of its power in Washington. And the party is counting on continued strength in those areas to contain its losses this fall, particularly after the repeated indications in a number of special and local elections over the past 15 months that distaste for Trump in urban centers and white-collar suburbs could produce a sharp backlash against Republican candidates in more densely populated areas.
In this volatile dispute, the stakes in rural America are high both economically and politically. No industry is more identified with the American heartland than agriculture, yet few are more tightly integrated into global markets.
Tough talk against China was a big part of Trump’s campaign pitch, but the prospect of an actual trade war with China could weaken that last line of defense for the GOP. No economic sector has raised greater alarms about the potential consequences of a trade war than agriculture, a highly export-dependent industry mired in a years-long slump even as most other economic sectors have revived. That’s sent farm state Republican elected officials and strategists scrambling to criticize the rapidly multiplying threats by Trump to impose punishing tariffs on a wide array of Chinese products — and the Chinese threats to respond in kind, particularly against US agricultural exports.
“For the rural economy in Iowa the forecast is grim, and I think Trump needs to understand what’s going on the ground out there,” says Craig Robinson, a longtime GOP strategist in Iowa. “These people in rural Iowa are already seeing their towns, their people and their population disappear. It is all consolidating in these metropolitan areas. If these tariffs actually happen, it is going to speed that up, and you risk speeding up that change where these are rock solid conservative voters today and in the next election cycle it could be completely different.”
Democrats believe the threatened tariffs are creating new opportunities for them in rural places that have become very stony ground for the party. “He is making a very, very big mistake by doing this,” says Rep. Cheri Bustos, an Illinois Democrat who leads the party’s rural engagement effort for 2018. “Many of the farmers I know, the growers and the producers, they were not only just supportive of President Trump but they were enthusiastically supportive of him. It’s one more indication that he’s treating us like flyover country. When you are messing with someone’s pocketbook at a time when they are already hurting, that does not bode well.”
Agricultural exports now consistently account for about 20% of farm income. That’s considerably higher than exports’ share of the total economy, which has varied from about 11% to just below 14% over the past decade.
China in 2017 passed Canada (which is locked in trade disputes with Trump over renegotiating the North American Free Trade Agreement) as the largest market for American agricultural exports. And soybeans, which China conspicuously targeted for retaliatory tariffs, this year will surpass corn as the crop that American farmers are planting on the most acres — the first time it has exceeded corn in at least 35 years, according to the US Department of Agriculture. Soybeans and corn rank one-two as the most highly exported American crops; China has tagged both, along with wheat, beef and pork, as targets for offsetting tariffs if Trump implements his threatened levies on a wide array of Chinese imports.
Adding to the pressure, the trade tensions are rising when many farmers are already scuffling. Though the recovery in energy production (particularly natural gas) boosted overall job growth in 2017 across small town and rural communities, agriculture itself has been suffering through a cycle of excessive production and weak prices: The Agriculture Department’s Economic Research Service recently projected that farm income this year would slump to its lowest since 2006. Ironically, even as Trump is threatening China, one of Agriculture Secretary Sonny Perdue’s principal responses to the squeeze has been to pledge to increase American agricultural exports.
Republicans’ rural base
All of this pressure is concentrating on exurban, small town and rural communities that have become central to Republican electoral power. As Tom Davis, a former Republican representative from Virginia and chair of the National Republican Congressional Committee, often says, the GOP’s center of gravity “has moved from the country club to the country.”
The extent of the shift is captured in data analyzed by Bill Bishop, the author of a highly regarded book on geographic and political polarization (“The Big Sort”) and co-founder of The Daily Yonder, a nonprofit website that examines rural issues.