In separate Thursday, May 9 press calls, two South Dakota lawmakers — U.S. Representative Dusty Johnson (R-SD) and Senator Mike Rounds (R-SD) — addressed this week’s trade talks with Chinese diplomats in Washington D.C., and the effects of current Chinese trade agreements on South Dakota farmers. Both lamented the strain that trade realities put on soybean farmers in particular.
“The Chinese have only bought half as many soybeans as they did last year… [the farmers] are getting anxious for a deal,” Johnson said.
A sore point in ongoing talks with the Chinese delegation, Rounds said, was the matter of the U.S.’ “intellectual property” and “trade secrets.”
Rounds accused some Chinese interests of being eager to obtain American “trade secrets” in a number of industries, sometimes leveraging access to Chinese markets in exchange for the information. China has been a member of the World Intellectual Property Organization, an agency of the U.N. that seeks to protect intellectual property rights globally, since 1980.
The conflict is only one of many in the U.S.’s ongoing trade conflict with China. The Trump administration recently threatened a 15 percent tariff spike — from 10 percent to 25 percent — on Chinese goods if trade agreements more amenable to American interests were not met this week. The increased tariff rates are set to be implemented on Friday, May 10.
Some observers, such as Economist Chad Brown of the Peterson Institute for International Economics, have claimed that increased tariffs will have the opposite of their intended effects.
In a May 5 tweet, Brown said, “The impact of the 2018 tariffs has been passed on to US consumers in the form of higher prices. China is NOT bearing the burden of Trump’s tariffs…”
In a 2018 study titled “The Impact of Trade and Tariffs on the United States,” Economist Erica York of the D.C. financial think tank “Tax Foundation” said, “Trade barriers such as tariffs raise prices and reduce available quantities of goods and services for U.S. businesses and consumers, which results in lower income, reduced employment, and lower economic output.”
Johnson said that tariffs for tariffs’ sake are a bad idea, but also said extreme measures may be required when dealing with the powerful Chinese government.
“When you have a hardball competitor like China, the only thing they understand is hardball,” he said.
Rounds said that of the South Dakota farmers he has spoken to, most said “they’re in [Trump’s] corner…,” and supported his administration’s trade negotiation strategy.
“When I talk to the producers in South Dakota, they say they’d love to get a trade deal,” Rounds said, “but we need to get a fair trade deal.”