Milling & Baking News - September 22, 2020 - 34

Washington

A chilling of foreign policy lingers
on agriculture's horizon
BY ROBBIN JOHNSON

however, though designed to solidify
WASHINGTON - With both political domestic political support while drivconventions - virtually - completed ing wedges between Western allies,
and Labor Day now behind, the na- may be having an opposite effect. US
tion will turn its attention to election- sanctions on Russia and some of its
eering. The prospect of many close oligarchs have tightened under PresiSenate races, a number of first-term dent Donald Trump.
Apparent Russian meddling in US
Congress members facing tough races,
money being poured into presidential and other countries' elections has
campaigns in battleground states and deepened suspicions. Several poisonmany fall sports shut down, the likely ings of Mr. Putin rivals, especially
barrage of political television adver- the most recent one involving Alexei
Navalny, have prompted strong reactisements will be mind-numbing.
Agricultural interests are un- tions in Britain and Germany. All of
likely to play a large role in these this may be drawing Western nations
political fights. There are, however, toward a common point of resistance
other developments that
will shape US agriculture's prospects in coming years. Most of these
are on the foreign policy
front.
Foreign policy tensions
historically have not been
kind to farmers. Too often, one side or the other
resorts to the "food weapon." The most obvious example was President Jimmy Carter's Soviet grain
embargo of Jan. 4, 1980.
It cost US grain farmers a ©DANEIL - STOCK.ADOBE.COM
huge market and, probably, President to an increasingly reckless Russia.
Carter that fall's election. The trouble- Though little agricultural trade with
some foreign policy concerns on agri- Russia is threatened these days, a reculture's horizon again involve Russia turn to Cold War atmospherics will
but also now China and the perennial not be helpful.
concerns over trade.
China becoming assertive
In the case of China, a great deal of
Russia's evolution
Over the past two decades, Russia agricultural exports is involved. Alhas evolved from a large grain export ready there seems to be some slippage
market into a significant grain and in promised Chinese agricultural imoilseed export competitor. It also has, ports from America under the "phase
under Vladimir Putin, evolved into one" agreement reached in January.
an authoritarian regime antithetical Human rights issues around Chinese
to much of America's long-term in- treatment of Uighers, civil and polititerests. There was probably little the cal rights issues around China's crackUnited States could have done to stem down on Hong Kong and military tenthe instability and corruption of the sions in the South China Sea and over
1990s that created the conditions for a Taiwan create many risks for a sudden
increase in confrontations that could
return to authoritarian rule.
Mr. Putin's actions in recent years, jeopardize agricultural trade.
More generally, the hope that had
guided America's China policy for
50 years - that engagement would
lead to political reform - has founRobbin S. Johnson, a fellow dered on the new reality of an autowith the Hubert H. Humphrey cratic China. As China becomes more
Institute of Public Affairs, assertive under President Xi Jinping,
is a contributing editor at US policies on trade, investment and
Sosland Publishing Company. technology have stiffened. The battle
34 / September 22, 2020

Milling & Baking News

with Huawei over 5G technology is a
good example of how quickly foreign
policy can shift from cooperation to
confrontation.
As President Trump and Joe Biden
compete for who can sound toughest
on China during this election season,
the slippery slope into confrontation
could become slipperier.
Trade update
The Trump administration has been
actively undermining the World Trade
Organization (WTO) in favor of bilateral negotiations since day one. It also
has been quick to impose tariffs both
to limit imports of sensitive products
and to generate leverage in negotiating better deals.
US Trade Representative Robert
Lighthizer often has been
at the point of that spear.
Consequently, a recent
op/ed by Mr. Lighthizer
in the Aug. 20 The Wall
Street Journal came as
something of a surprise.
While acknowledging
that the United States
could do fine in a system
of bilateral agreements,
he argued for a "reset"
of the WTO and the multilateral trading system
organized around five
principles:
1. "WTO members need to agree on
baseline tariff rates that apply to all,
with minimal exceptions."
2. "... end the free trade land grab"...
in favor of "unconditional most-favored-nation treatment to one another."
3. "... China, India and other advanced economies should follow the
same rules that bind America, the EU
and Japan."
4. "... the WTO needs new rules to
stop the economic distortions that
flow from China's state capitalism."
5. "... the WTO's dispute-settlement
system should be totally rethought."
Proponents of the multilateral
trading system that has underpinned
much of the global economy since
the end of World War II largely could
embrace these principles. It is less
clear, however, that China, India and
other developing countries are prepared to embrace such even-handed
treatment. They have enjoyed the advantages that have accrued to them
and have been reluctant to give them
up. So, it remains unclear whether
Mr. Lighthizer's proposals would
gain traction, even if there is a second Trump term. MBN
bakingbusiness.com / world-grain.com

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Milling & Baking News - September 22, 2020

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