Yup; the City Slicker from the Borough of Queens blew-in to Wisconsin a couple days ago and maybe got his shoes dirty. But I doubt it. This was all for show because things have become increasingly uncertain in farmland world. By and large, farmers continue to support the president. Why? Trump gets it. The truth is not in his actual policies but in his showing-up to address their fears. How to make farmers think he sees them; the people that live in fly-over country.
For as long as I can recall I have not held any particular fondness for the Communist Red-Chinese government. They have raised the theft of intellectual property to an art form and have bamboozled the trade negotiators of every administration for just as long; including Trump 1.0 and now Trump 2.0 as well.
If I had a rational discussion with a Trump supporter I would hear a case that the recent troubles felt by family farmers and ranchers are simply short-term nuisances that are necessary to challenge long-standing, unfair trade practices by foreign countries; China in particular.
And I suppose that my interlocutor would likely suggest that it is only "strong medicine," such as an aggressive tariff strategy, followed-on by subsequent renegotiation that would result-in better more structurally-sound and long-term trade deals. Fair-enough.
Yes, American agriculture is a complex subject; nevertheless, my immediate neighborhood is an almost exclusively agricultural community. We own a farm and farm policy is of personal interest. Consequently, and anecdotally, I hear and have some tingly sense that patience may be wearing thin. Hardly for all but certainly for some.
And I am not alone; numerous agricultural economists and trade orgs - who know more about this than I do - would argue that Trump policy-making initiatives have resulted in no small amount of financial strain for American family farms.
Specifically, the strong medicine and its side effects include: lost export markets, rising input costs, financial instability leading to bankruptcies and dependency upon federal subsidies.
Let's dissect each.
Mr. Trump has famously expounded-upon his love of tariffs; thusly when your only tool is a hammer every trade issue is treated like a nail. The extensive use of tariffs - particularly Section 232 of the Trade Expansion Act - has led to retaliatory measures from major trade partners, including China. This impacts an expansive list of stuff ranging from auto parts to semiconductors. While most certainly the president and possibly my interlocutor might erroneously persist with the notion that foreigners pay these tariffs and make us wealthy beyond belief; the truth is that import companies pay them and pass the cost on to US businesses and consumers. Just like a sales tax, tariffs make imported goods costlier. Another unintended and equally unfortunate outcome is loss of market share.
For decades China has been the undisputed heavyweight champion when it came to buying American soybeans. It is a fact that the Chinese used to be the largest buyer of our beans than the rest of the world combined. From the end of May through November of last year China did not purchase a single American soybean, choosing to do business with other countries instead. As a result of Trump's import taxes China responded with an imposition of their own duties along with a boycott of American beans. Sales, along with domestic prices, plunged. Meanwhile, American agricultural exports to Canada decreased by more than $1 billion largely as a consequence of Canadian boycotts of American products.
Farm economists now point to the acceleration of a structural shift in markets with China permanently diverting its agricultural purchases to competing nations. Even after a handful of temporary trade truces were reached American farmers today have a significantly reduced share of the global market.
What about input costs? The president would tell you that tariffs are intended to protect domestic manufacturing. And while that might be a necessary and useful tool to shield boutique specialty industries; when applied in broad swaths these trade taxes increase the cost of raw materials used to manufacture heavy machinery.
Not surprisingly, manufacturers like Deere are faced with higher production costs due to tariffs on metal, microchips and other component parts which are passed on to farmers in the form of higher prices for Deere tractors, harvesters and combines. Even Trump knows this as the administration relented and temporarily reduced the offending taxes impacting agricultural equipment from 25% to 15%.
And then, of course, Donald Trump made a unilateral decision to go to war with Iran resulting in the closure of the Strait of Hormuz. This set in motion a cascade
of destabilizing events that have dangerous consequences for global
stability, security and the world's economy. This has spiked energy costs and disrupted the the global supply of nitrogen and urea. Some fertilizer prices are up 47% year-over-year. For us here in the northern hemisphere the manure hit the fan before spring planting. What were they thinking?
Putting-on my financial guy hat, I am now witness to a perfect storm of reduced export commodity prices and skyrocketing operational costs conspiring to squeeze profit margins.
According to the American Farm Bureau Federation, last year, America's crop farmers lost $34.6 billion and farm bankruptcies surged to numbers not seen since 2020. In farm states like Iowa, Nebraska, South Dakota, Minnesota and Wisconsin there is now a sharp uptick in family farm bankruptcies and foreclosures.
To cushion the gut punch from his unilateral trade war Trump has authored the distribution of billions upon billions of direct aid including a $12 billion market facilitation package and the Farmer Bridge Assistance Program.
These payments are a lifeline to keep farmers afloat; nevertheless, they smell peculiarly of Soviet-style central economic planning. Or garden variety welfare; you pick.
From a purely economic perspective none of these subsidies assist the local rural economy. Almost all of it went to multinational fertilizer and seed syndicates and large corporate landlords. Moreover, welfare payments distort market economics resulting in an unstable environment where farmers become dependent on federal intervention rather than stable global commerce. See previous paragraph.
So when I opened with the observation that the president's visit was mostly for show ask yourself if following Mr. Trump's departure did anything change for Wisconsin farmers?
Have lost export markets returned? Have import duties gone away? Has the price of fertilizer, diesel or purchased and leased equipment come down? The Strait of Hormuz might reopen tomorrow; yet because things are so horribly broken any return to normalcy will take a year or more. That does nothing to stem the immediate rise in bankruptcies and foreclosures for family farms.
Farmers like to joke about why they don't gamble or place wagers in the prediction markets. They'll tell you every season already comes with enough business crippling risks to satisfy anybody's passing itch to speculate. Ham-fisted government policy getting in the way simply exacerbates the risks. Increasing dependency on the federal dole to mask flawed policy in both trade and war is a failed strategy by any historical measure.
Farming is hard work and unlike an IPO or private equity wealth comes slow and steady. America's family farms are not experiencing some transitory short-term hardship; they are disappearing. Bankruptcies were up 55 percent in 2024, 46 percent in 2025 and 70 percent already by May of this year. It will be interesting to follow how support for the president holds-up amongst farm producers for the remainder of his term.
Time will tell....
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