Ohio farmers are worried. But a guy named Sonny has swung by in his RV to reassure them. Sonny Perdue, the US Agriculture Secretary, is on an RV tour of several “flyover” states, reassuring farmers along the way that tariff tiffs will not harm them.
As the soybean industry assailed President Donald Trump today for launching a trade war with China, U.S. Agriculture Secretary Sonny Perdue said Trump assured him that farmers in Ohio and across the country “will not be allowed to be the casualty in a trade dispute.”
After an appearance before farmers here, Perdue acknowledged “there is legitimate anxiety out here” because of China’s announcement it plans to impose a 25 percent tariff on imports of soybeans, a move which could cripple Ohio farmers who exported nearly $700 million of soybeans to China last year.
Ohio farmers aren’t the only ones worried. Several Midwestern states, including Iowa, are leading producers of soybeans. Others, like Wisconsin, while not leading producers, still consider soy an important crop.
Speaking to reporters, Perdue cautioned that the new tariffs unveiled in the past two days by the United States and China “are announcements” which “are not going to take effect” immediately.
“Our goal frankly is to get China to the table to discuss some of the unfair trading practices,” Perdue said.
Perdue’s statement suggests the White House does not intend to let matters escalate to the point where these devastating tariffs would take effect.
Trump says trade wars are “easy to win.” FiveThirtyEight purports to have a simulation where you can test this for yourself. I played a few rounds and indeed found it fairly easy to win (where winning means matching or exceeding the gains expected from free trade). That said, I may have simply gotten lucky in my opponents. With the opponents I got, sticking almost entirely to a free-trade strategy, but choosing high “vindictiveness” if I did retaliate, seemed the way to win. Most times, though, players did not win, even when they won.
In 58 percent of the games we analyzed, the winner was worse off than they would have been under free trade.
This trade game is essentially a repeated prisoner’s dilemma — a workhorse model of game theory that captures the tradeoff between mutually beneficial cooperation and individually beneficial betrayal.
How well does this simulation reflect reality? I’m not sure. Could it be a model designed to make trade wars harder to win than they really are? Perhaps.
In rust-belt states like Ohio and Wisconsin, Trump has been losing support from white working-class women, while retaining it among white working-class men. The rust belt and soy belt overlap some, while the soy belt also includes other swing states, like Iowa and Minnesota.
In their present predicament, denizens of Soyville, USA, might be too nervous to feel joy at sight of Perdue’s RV, but at least our US Ag Secretary is offering them some reassurance for now.