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CHINA AND AMERICAN COTTON
"When you fly into Lubbock International Airport, you're going to land in the largest cotton patch in the world."
Rep. Jodey Arrington
February 27, 2019
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Jodey Arrington, a Republican from Lubbock, Texas, is relatively new to Congress. He was first elected in 2016; so he is now in the first year of his second term. Still, he has packed a wealth of experience - including government experience - into his 47 years, having served, for example, in the administration of President George W. Bush and before that in the office of Governor Bush.
He is a member of the House Committee on Ways and Means and as such was one of those who questioned the U.S. Trade Representative, Ambassador Robert Lighthizer, when he appeared before the Committee on February 27. The hearing was well into its second hour when Mr. Arrington began his inquiry. He began with a boast:
Let me just say, Mr. Lighthizer, West Texas is the food, fuel, and fiber capital of the United States of America. We feed and clothe the American people. We fuel the American economy. That's fossil and renewable. And we provide energy independence and food security. And I'm proud to represent our hard-working farmers and ranchers, and their concerned.
In time, Mr. Arrington got to his question, which focused on the prospect for China significantly increasing its purchase of American cotton. We'll return to that in a moment. First, however, it is worth underscoring those concerns he was talking about. These few sentences from Mr. Arrington provide an outline:
Times are desperate. ... Over the last few years we've seen a decline of over fifty percent in farm income in the United States ag. industry. That's the steepest decline since the Great Depression. Forty percent, roughly, increase in bankruptcies, and I'm sad to report that farmers have the highest suicide rate in the United States of any profession, five times the national average.
Mr. Arrington was also clear, however, that, notwithstanding these conditions, the farmers and ranchers of West Texas support President Trump. He said:
They'll stand with him right up until they have to sell the family farm. ... They love him, and they appreciate him. They know that he's fighting for them.
The Cotton Situation. Turning specifically to cotton, Mr. Arrington said: "We [in West Texas] produce about a third of the cotton that we export out of the United States. But we've lost 50 percent of our market share in China."
Then came the question for Ambassador Lighthizer:
Can you talk about cotton being mentioned in our purchase commitment discussions with the Chinese, please?
The ambassador's response was clear and unequivocal. "In terms of the purchase commitment, he said, "absolutely cotton is a factor."
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If there is a U.S.-China deal - and surely at some point there must be - it will include new purchase commitments from China. And cotton will be included. As Ambassador Lighthizer noted in his response to Rep. Arrington, "It's something China needs, has traditionally bought, and it's easy to buy more of it."
All true. But on the other side of the ledger is fact that the core of the current dispute with China is not agriculture but China's industrial policies, especially those affecting hi-tech industries, technology transfers, and the theft of U.S. intellectual property. In short, the negotiators can't get to the purchase agreement issues until they have first forged some agreement on those largely non-ag issues. And we noted in an earlier entry, pressure is mounting on the Administration not to lift the tariffs on China without, in S
enator Wyden's words, "evidence on the ground of real change."
Representative Arrington may well be in the same camp as Senator Wyden. In the lead up to his question about cotton commitments, the Texas congressman said,
"We want the equitable, reciprocal, and enforceable structural reforms that you talk about." And for our part, we do not doubt the sincerity of that statement.
Still, moving U.S.-China trade to something that might be called equilibrium or normal is a long-term process at best. Managing that process, much less achieving its goal, is going to involve many, many difficult conversations - and not just between U.S. and Chinese negotiators. There are lots of different groups in the United States affected by U.S.-China trade in lots of different ways. Those groups too may need to engage in some difficult conversations, if not for the next agreement, then for the one after that.
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A China Hearing takes you to the YouTube video of the Ways and Means hearing on U.S.-China trade, which was held on February 27, 2019. This was the source for today's featured quote and indeed most of this entry. The exchange between Representative Jodey Arrington and Ambassador Lighthizer begins roughly at 1 hour 18 minutes.
A Test for Tariffs is a link to the TTALK Quote for March 13, which focused on Senator Wyden concern that the tariffs on imports from China not be lifted prematurely.
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©2019 The Global Business Dialogue, Inc.
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Washington, DC 20006
Tel: (202) 463-5074
R. K. Morris, Editor
Joanne Thornton, Associate Editor
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