Many in agriculture are wondering what the future holds under a Joe Biden Administration, especially when it comes to trade. Randy Russell is a former USDA Undersecretary and the current President of the Russell Group in Arlington, Virginia. He spoke during a recent CME Group webinar and says things will look a lot different than they did during the previous four years.
“The Trump administration focused, as you guys know better than anyone, very heavily on using tariffs as a means to an end. By that, to get people’s attention and get them to the negotiating table. They certainly used it on the steel and aluminum tariffs with Canada and Mexico. Made some threats on Korea before we had the KORUS agreement put in place. They negotiated a phase one agreement with Japan. The administration certainly imposed significant tariffs on China and many of those remain.”
He does give the administration credit for the Phase One trade deal with China. Russell says the next four years may be more about cooperative efforts, especially when it comes to dealing with China.
“I think, relative to China, with a new Biden Administration what you might see is two things: one is an effort to try to put more pressure on China by working with our allies, working with our trading partners to try to put some pressure on China. Number two is, I think you might see them try to reduce some of the tariffs or even eliminate some of the tariffs, I’m not saying all the tariffs, and see if there is a reciprocal action on the part of the Chinese to try to lower the temperature in the relationship.
He looks at trade from the Chinese perspective and says it’s very different from the U.S. way of doing things.
“It doesn’t matter who’s president in their eyes. They are on a path over the next 20 to 30 years to get to a certain point economically. And, up until this point, I think it is pretty clear that they’ve stolen our technology, they’ve restricted our foreign investment, they have clearly taken aggressive actions against Hong Kong in the South China Sea, they’ve had human rights violations in the northwest section of China, and those are all going to be very vexing issues for the Biden team when they come in.”
He says China is going to continue to be a “vexing problem” for many administrations in the years to come.