President Trump is Bankrupting Farmers
Eighty-four farms have filed for bankruptcy in Wisconsin, Minnesota, North Dakota, South Dakota and Montana during the time period of 2017 – 2018, more than double when compared to 2013 and 2014.
The bankruptcy filings are due to lower prices on corn, soybeans, milk and beef according to reporting by the Star Tribune. The increases in bankruptcy filings are due to the retaliatory tariffs employed by Trump’s administration since the Chinese market has shut itself off from the soybean market, milk, and beef.
This, after GM has announced shutting down factories and hundreds, if not thousands of employees are being laid off.
I originally wrote about this issue as it relates to dairy farmers paying the price for the Trump tariffs and that post is seen below.
The Star Tribune report could be read via this link.
Alexander Hernandez, Esq.
Now Trump Has Pissed off the Farmers
Because of Trump’s self-created trade war, farming groups are now responding with an anti-Trump campaign (get in line).
So far, the results of the trade war have not been positive, and now it is affecting farmers. What’s the response? A $12 billion bailout.
Now, let me interject with my own experience as a bankruptcy attorney for almost twenty years. When a client comes to see me, it’s because bankruptcy is the last step. Bankruptcy clients have already tried to get out of debt on their own. You know how? By getting into more debt.
So, we could just throw more money at the farmers, and by the way, I still remember when the word “bailout” during the Obama administration was a bad word, and some would even call this “government handouts,” but here is an idea–go back to how it was!
You know how I know this is a good idea? Read the first line of this blog- the farmers are on a anti-Trump tariff campaign and guess who knows about farming? Farmers!
The American Farm Bureau Federation and the National Pork Producers Council is investing $2.5 million, money they probably don’t have and could think of other ways to spend, just to show the negative effects the tariffs are having on the farming industry. The campaign is being organized by the Farmers for Free Trade Organization.
Unfortunately, we know Trump’s answer to this- more tariffs! That strategy is as effective as being in a bar at 3 a.m. and thinking another round of tequila is a good idea! It’s not!
The Law of Supply and Demand, which was probably taught to me before I even entered junior high, sums this up easily. Yet, when I wrote numerous articles on my motorcycle blog (mcatty.com) about Harley Davidson getting hit by the tariffs, of course, the Charles Manson-like supporters (yes, I will be using that analogy more often) did what they always do- attack! I wrote back to one individual that this is not just about motorcycles, but pork, fruits, jeans, and bourbon. His genius response was “more barbeque for me.”
Again, the Law of Supply and Demand. Google it. If other countries retaliate (which they are) with tariffs, less people are buying so prices go down and the farmer loses money and he is overstocked. If you are having problems selling ten pigs, then logic dictates you don’t need one hundred pigs at the moment. It’s not rocket science.
So, what do we do now? We create a false economy. How?
The United States Department of Agriculture is going old school, and what I mean by that is that they are using a Great Depression-era law where they will purchase directly from farmers and then distribute the food to food banks. Keep this up and you won’t need to Google “Great Depression” because you will be experiencing it.
Now, it is a great idea to stock up food banks because they could always use more help, but guess where the money is coming from? Go back and reread paragraph three on borrowing.
The money is being borrowed from the Treasury Department. Isn’t that government spending? Why else do you think there are plenty of Republicans calling this “welfare.”
China, Canada, and Mexico are the largest buyers of goods from the U.S. farming industry, yet, we entered in a trade war with them. Here’s another analogy- this is comparable to having a great day with your spouse and for no logical reason at all, you decide now is a great time to pick a fight and bring up something from the past. How did that work out?
I could only begin to imagine how much $12 billion would help in infrastructure. We never seem to have money for anything like education, health care, and taking care of our vets, but we seem to find money (by borrowing) when we need to.
Here’s something to ponder- Mexico purchases approximately twenty-five percent of the cheese the U.S. exports. Can Mexico survive without cheese? Yes! Can Wisconsin survive without selling their milk which is turned into cheese? No!
Wisconsin in 2017 lost five hundred dairy farms and Harley Davidson already has one motorcycle boot out the door. Potentially, Wisconsin is the next Detroit, Michigan.
Alexander Hernandez, Esq.
Alexander Hernandez represents clients in the areas of Chapter 7 Bankruptcy, Family Law/Divorce, and car and motorcycle accidents.
(904) 712-5565 or (305)-688-LAWS (5297).