Trade

By former USDA Secretary John R. Block

For some time now on the question of trade, all we have focused on is our trade war with China.  I will talk about that today.  But I also want to remind everyone that trade differences with Europe should also be in the spotlight.

China – we just completed a round of productive negotiations with China.  That discussion was only the first step.  It provides a foundation for the next round of negotiations when U.S. Trade Ambassador Robert Lighthizer will be there.  At this point, China has committed to buy more goods and services from the U.S.  They approved the imports of 5 new varieties of genetically modified crops.  They have gone back to buying soybeans but are way behind former years.  There are other unresolved issues, including China’s huge subsidies for some of their government-owned companies.  A way to protect our intellectual property is still up for debate.  I am optimistic, but it is not done until it’s done.

Turning to Europe – our trade deficit with Europe has come in at $120 billion for the last 4 years.  Last year, Europe promised to buy more from us to help balance trade differences.  They agreed to lift non-tariff barriers.  Give Europe credit for one thing – they are buying more soybeans and liquified natural gas.  However, we’re not getting very much done.  Here is what Gordon Sondland, U.S. Ambassador to the EU, had to say: “So long as the EU leadership plays the delay game, the more we’ll have to use leverage.”  Does that mean a tariff was with the EU?

We all understood that the EU Commission President and President Trump made a deal last summer: “Work together toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods.”

But here is one of the most disturbing messages from the EU – they say they are not going to negotiate any trade deals on ag products.  They don’t want GE foods.  Most of our beef and dairy products can’t get in the door because we use growth hormones.  I can say from years of experience that Europe has never been free and open to our products.  I am happy that President Trump is taking a strong stand.  We need to – good luck.

John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill.  If you would like to review his radio shows going back more than 20 years, just go on-line to www.johnblockreports.com.