A library’s worth of books will be written about the historic 2016 presidential election. One thing they all will agree on is the fact that President-Elect Donald Trump was carried to victory on the strength of the rural vote.
With Trump in the White House and Republicans in control of both houses of Congress for at least the next two years, it could mean major shifts for the farm equipment and agricultural sectors. Here’s what to expect out of the new administration:
- Regulations: It’s safe to say no federal agency did more to drive rural turnout than the U.S. Environmental Protection Agency (EPA). The list of grievances is long, but the highly controversial expansion of the “Waters of the U.S.” is atop it. Farmers and ranchers across the country fought against the expanded jurisdiction EPA sought for the Clean Water Act like never before and achieved a temporary victory when the courts intervened to delay implementation of the rule. Trump singled out the Waters of the United States (WOTUS) rule in particular as one he would most likely target once in office. The Trump administration is unlikely to introduce new regulations for farmers and manufacturers and indeed may roll back some of the most cumbersome rules from the Obama era.
- Trade: Commodity and manufacturing exports are of particular importance to AEM members and their customers, which is why Trump’s anti-trade rhetoric on the campaign trail was so alarming. Agriculture is one of the few sectors where America enjoys a trade-surplus, and upsetting the current environment could spell tough times for many commodities.
Economic analysis by the American Farm Bureau Federation estimated passage of the Trans-Pacific Partnership (TPP) alone would add $4.5 billion to farm income. However, the TPP is likely dead, along with a European trade deal that had been under negotiation. The question now is how far President-elect Trump would go in disrupting current trade accords.
- Renewable Fuel Standard (RFS): Trump expressed support for the RFS while campaigning for president, and his Iowa director was the former state director for a pro-ethanol group and the son of current Iowa Gov. Terry Branstad, another proponent of the RFS. While his administration is likely to continue to follow the path set forth by congress in the 2005 and 2007 energy bills, we can also predict the new EPA will be far more receptive to the views of the oil industry.
- Infrastructure: Though a Trump infrastructure plan might not necessarily hit the $1 trillion price tag he promised, the president-elect has signaled an intention to pursue some type of package. Beyond the obvious advantages to farmers and ranchers of the more efficient movement of commodities through inland waterways, ports and rural roads, the level of support demonstrated by these areas could help entice support for other initiatives, such as expanding wireless broadband connectivity.
For the most part it is still too early to tell what the priorities will be for a Trump presidency on several issues critical to agriculture. It is a promising sign that Vice President-Elect Mike Pence, who represented an ag heavy district in Congress and served as governor of an ag state, appears to have been given the lead on developing the administration’s ag policy.
Official Washington remains somewhat uncertain of how Trump – who rode to power in one of the most unconventional campaigns in recent memory – may try to make good on his campaign promises and navigate traditional Washington institutions, like Congress. The first few months of the new administration should yield significantly more insight as to what a Trump presidency will mean for manufacturing, agriculture and the entire economy.
AEM DC Office Perspective