Can dysfunctional Washington function?

by Stephen Wagner
Jim Wiesemeyer returned to Lancaster in mid-February to talk about Washington to a group of pork and poultry producers, a program hosted by Penn-Ag Industries. Wiesemeyer also contributes articles to various farm publications and participates in agri-broadcasts as his time permits. He spends much of his time in Washington D.C., keeping a farmer’s ear to the ground, and speaks often about farm issues and farm policy.
“We have synchronized growth in the U.S., merchant markets and the world,” he said. “How does that translate to agriculture? Demand. Not only do you have countries wanting protein…they have the ability to pay.”
What could make this picture less rosy in the years ahead? Inflation, interest rates and possibly the tax cuts if they overheat the economy, which is not a likely scenario. President Trump is trying to change Washington, but neither party wants to be changed. “I don’t believe that Trump is a Republican, but rather he is more of a Populist Libertarian,” Wiesemeyer said. “It’s the beginning of a third political party, in my judgment.”
The geo-political flags may well have an impact not yet seen. You can have the best growth market for poultry and hogs ever seen, and an international event could wipe you out. Trade is the key focal point. “A lot of people ask me ‘why when the interest rates and the economy are so good is the dollar going down?’ The answer is that Europe hasn’t even started raising their interest rates, so the market is going along with the Euro,” he said. “We’re in a China-centric world. Twenty years from now, China is going to be number one in the economic environment.”
“An agriculture downturn,” Wiesemeyer continued, “lasts four to seven years. So we’re right in a period where we see this bottoming, then you start going up. John Deere released their quarterly results recently, and sales were greater than expected. There is a distinct correlation between sales of John Deere farm equipment and net farm income.”
Wiesemeyer is often asked why Washington is so uncivil. He explained it by pointing out that if a political party deems better results in the near future at the ballot box, they will be in no hurry to compromise. “The election experts, who were so wrong in not predicting a Trump victory, are now predicting that Democrats will win in a wave in the fall elections,” he said. He also noted that we have the most women candidates in House and Senate races ever. Wiesemeyer sees continued control of the Senate for Republicans, and greater uncertainty for a similar outcome in the House.
On Trump’s third day in office, he withdrew from the Trans-Pacific Partnership agreement. “He has struggled to leave the North American Free Trade Agreement (NAFTA),” Wiesemeyer reminded his audience. “But a secret to our President Trump is that his bark is worse than his bite. And that is why I think there will be a successful NAFTA negotiation. Regarding the China-U.S. trade issues, we’re in what’s called a Section 232 [of the Trade Expansion Act of 1962] investigation. China is a big part of that with steel and aluminum. That could come back to be a very big negative for U.S. agriculture if they retaliate against our soybeans and poultry.”
If a Farm Bill is passed this year, Wiesemeyer thinks “it will be the first time since 1954 that an all-Republican Washington…passes a bill. We are, for the first time in my lifetime, going through fundamental changes in dairy policy. I think that finally we are going to get an effective safety net for both the smaller and the larger operators.”

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