The Wrath of Grapes

 California farmers destroying their own vineyards

Argentine vessel loaded with soybeans for China

          Rare earth extraction in China

The Wrath of Grapes

The Withering Grape in the Coal Mine

In northern California, it started with an oversupply of wine-making grapes, then a drought followed by massive wildfires, then the vineyards began to return while much of the crop growth retained a nasty smokey flavor that ultimately subsided, but American farmers became the brunt of retaliatory tariffs, the sign of resistance to Trump’s bullying tactics. Shortages of seasonal farmworkers – the immigration reality – and soaring insurance costs exacerbated bad to worse. Vineyards were torn out, representing a permanent downsizing of California’s crops, as those California almond and pistachio farmers were also finding themselves the brunt of global anger at American efforts to shove US policies down the throats of the rest of the world.

Take a walk into a Canadian supermarket and check out the wine/liquor department. You won’t find California wine or Kentucky bourbon anywhere. It is now considered unpatriotic for any

Canadian resident to buy any product made in the United States. Europe and China are more than ready to buy Canadian products and fill Canadian shelves without prohibitive tariffs. Trump had a slightly edited Reagan speech to use as his next excuse to slam Canada.

In the latest trade battle skirmish, you can tell that China already had detailed plans to tame Donald Trump’s misguided beliefs that he could control global trade to suit his purposes. Indeed, expecting Trump’s reelection, China learned the lessons of Trump 1.0, ready to counter their projection of what Trump’s 2.0 would likely look like. And boy was Beijing right on the money. Instead of seeking some sort of compromise from to Trump’s expected efforts toward global economic hegemony, China had a detailed action plan to counter Trump’s every move.

As the only other major military and economic superpower, China was not about to play by Trump’s rules. They had their military base in their landfilled air base in the Spratley Islands, and they were quite ready to confront regional fishing boats, plying on their normal local fishing grounds, with force. They asserted control over much of the East and South China Seas. Additionally, they had upgraded their military to challenge American superiority and were the direct beneficiaries of any new military technology developed by Russia.

Further, the Chinese leadership counted heavily on their perception that Donald Trump was destroying his own country in order to reinforce his own quest for autocracy, although Trump seemed devoid of the expertise to run his own land. Even Trump’s cabinet officers were considered a joke to China. Globally, as the United States was withdrawing its soft diplomacy through foreign aid, China was stepping in, from its Belt and Road trade-linking infrastructure initiative to out-and-out charitable giving.

But the next reaction was to Trump’s levying a 100% tariff on Chinese imports – that was part of a $700 billion annual trade between the powers, of which more than 2/3 was represented by US imports – which drew a carefully pre-planned Chinese decision not to buy any US soybeans (a loss of $20 billion to US farmers in the Midwest), filling their need with soybeans from Argentina, a nation which simultaneously got a currency bailout commitment (if they cooperated) of tens of billions of US dollars. It’s an understatement that US farmers were pissed, and a Trump pledge to use taxpayer dollars to fund a make-good payments (as happened in 2017 per Trump 1.0) failed to mollify the agricultural constituency. Most Republicans.

As noted by Scott Horsley, writing for the October 16th NPR: “Despite a bumper crop this year, [soybean] farmers are losing money as a result of rising costs and falling crop prices… This is a bitter harvest season for many American farmers… There's nothing wrong with their crops, which are bountiful. But even as grain elevators overflow with freshly picked corn and soybeans, farmers are losing money on every bushel. And there's not much relief in sight.

“Economist Shawn Arita of North Dakota State University says the crop sector is being hit by a ‘triple whammy… You have high production costs. You have low crop prices. And then you also have the trade situation that exacerbates the condition’… Brady Holst is one of the farmers being hit. He raises soybeans, corn and wheat in western Illinois. Holst typically sends part of his harvest down the Mississippi River and on to overseas markets like China. But thanks to the trade war, China isn't buying any U.S. soybeans this fall. That boycott is putting more downward pressure on already low crop prices.

“‘You used to just have to worry about weather,’ says Holst. ‘But seems like in the last 10 years, you basically have to worry about what's going on with politics here in the U.S. and then geopolitics in the world. Because you see so many things going on that affect how farmers are doing business.’” As Trump rattled his economic saber at China, Beijing’s next, preplanned response was instantly implemented.

Reality gave China a “trump” card: they controlled 70% of the Earth’s supply of rare earths, metals that have become necessities in all aspect of electronics and avionics manufacturing, from computers and automotive parts to jet fighters. So, by severely limited export of those essential elements, they could bring Western manufacturing to its knees. As this was on the table as Trump traveled to Asia to make nice… another expected Trump capitulation when his bullying failed. In advance of Trump’s trip, Treasury Secretary and his fellow cabinet officers were already negotiating the terms of Trump’s surrender to reality.

I’m Peter Dekom, and I am still waiting for someone with the requisite expertise to tell me what benefits the United States, as a whole, has generated from Trump’s misguided tariff policy.