Tariff fight could hit GOP in key Senate states

Tariff fight could hit GOP in key Senate states
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Democrats see President TrumpDonald John TrumpFacebook releases audit on conservative bias claims Harry Reid: 'Decriminalizing border crossings is not something that should be at the top of the list' Recessions happen when presidents overlook key problems MORE's escalating trade war with China as an opportunity that could help them win several Senate races in states where a trade fight would damage local economies. 

States that rely on agriculture could be hit particularly hard by retaliatory tariffs from China. That could give Democrats in states like North Dakota, Montana, Indiana, Missouri and Florida — all of which are represented by Senate Democrats up for reelection this year — a new argument to make against the president and his allies in Congress.

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The administration launched the first wave of tariffs last month on steel and aluminum, but tensions rose this week when the White House announced $50 billion in tariffs on a variety of Chinese electronics and other goods.

China responded with a broad list of U.S. goods that would face $50 billion in tariffs as well — a response that prompted a White House threat to add $100 billion in new tariffs to Chinese goods. 

The Chinese tariffs target a smattering of U.S. goods, including soybeans, cotton, corn, pork, chemicals, plastics, cattle, wheat and tobacco. 

China is one of the biggest markets for American export goods, and a top recipient of American agricultural products like soybeans, corn, grains and pork, according to the Office of the United States Trade Representative.

Soybeans and hogs are major sources of revenue in states like Minnesota, Indiana, North Dakota and Missouri. Corn is a major crop in Nebraska, Minnesota and Indiana. And Nebraska, Missouri, Wisconsin, Montana, Minnesota and Florida all feature large cattle industries.

All of those states will see Senate races in 2018, with several Democratic incumbents on the ballot in states Trump won in 2016. Republicans are warning that the economic impact of tariffs could be felt hardest in key Senate states if the trade war continues.

“The economic pain that people will feel from tariffs will be a good reminder of how important free trade is to the economy,” said Alex Conant, a GOP strategist who has served as a top aide to Sen. Marco RubioMarco Antonio RubioTrump moves forward with F-16 sale to Taiwan opposed by China The Hill's Morning Report — Trump and the new Israel-'squad' controversy Trump crosses new line with Omar, Tlaib, Israel move MORE (R-Fla.). 

“The people most at risk are the people in disproportionately red states who voted for Trump,” he said, adding that the “coincidence of the cycle” is that those states are also home to Democratic incumbents targeted by the GOP.

Democrats are on defense in Missouri, Wisconsin, Indiana, Montana, Florida and North Dakota, where Sens. Claire McCaskillClaire Conner McCaskillEx-CIA chief worries campaigns falling short on cybersecurity Ocasio-Cortez blasts NYT editor for suggesting Tlaib, Omar aren't representative of Midwest Trump nominees meet fiercest opposition from Warren, Sanders, Gillibrand MORE (Mo.), Tammy BaldwinTammy Suzanne BaldwinRecessions happen when presidents overlook key problems Trade wars and the over-valued dollar Overnight Health Care: Senate panel advances drug pricing bill amid GOP blowback | House panel grills Juul executives | Trump gives boost to state drug import plans | Officials say new migrant kids' shelter to remain open but empty MORE (Wis.), Joe DonnellyJoseph (Joe) Simon DonnellyLobbying world Trump nominees meet fiercest opposition from Warren, Sanders, Gillibrand GOP frets over nightmare scenario for Senate primaries MORE (Ind.), Jon TesterJonathan (Jon) TesterNative American advocates question 2020 Democrats' commitment House Democrats targeting six more Trump districts for 2020 Budget deal sparks scramble to prevent shutdown MORE (Mont.), Bill NelsonClarence (Bill) William NelsonAl Franken says he 'absolutely' regrets resigning Democrats target Florida Hispanics in 2020 Poll: Six Democrats lead Trump in Florida match-ups MORE (Fla.) and Heidi HeitkampMary (Heidi) Kathryn HeitkampPence to push new NAFTA deal in visit to Iowa Al Franken says he 'absolutely' regrets resigning Trump nominees meet fiercest opposition from Warren, Sanders, Gillibrand MORE (N.D.) are all running in states won by Trump. 

Minnesota Democratic Sens. Amy KlobucharAmy Jean KlobucharCastro qualifies for next Democratic primary debates Eight Democratic presidential hopefuls to appear in CNN climate town hall Biden, Buttigieg bypassing Democratic delegate meeting: report MORE and Tina SmithTina Flint SmithReid says he wishes Franken would run for Senate again Senate Democrats introduce bill to combat foreign influence campaigns Durbin says he has second thoughts about asking for Franken's resignation MORE are running for reelection too, although their seats are considered more secure for Democrats after Hillary ClintonHillary Diane Rodham ClintonThe exhaustion of Democrats' anti-Trump delusions Poll: Trump trails three Democrats by 10 points in Colorado Soft levels of support mark this year's Democratic primary MORE won Minnesota in 2016. And Nebraska Republican Sen. Deb FischerDebra (Deb) Strobel FischerThe 23 Republicans who opposed Trump-backed budget deal Landmark US-Russia arms control treaty poised for final blow GOP senator introduces bill banning 'addictive' social media features MORE is also not seen as in serious danger in her red state.

Many of the top soybean-producing states depend on exports to China. North Dakota, for example, sends two-thirds of its soybean production to China. Tariffs on those imports could raise prices, prompting Chinese buyers to choose soybeans from other markets.

“If you’re a soybean farmer, you’ve got to be nervous about this,” said Mark Zandi, the chief economist at Moody’s Analytics. 

The Chinese trade war also puts a strain on Montana, a top producer of wheat. From 2016 to 2017, China was the third-largest purchaser of hard red spring wheat. According to the Montana Grain Growers Association, Montana sold 7 million metric tons of that crop to China last year.

Trade and business associations in these rural states are sounding the alarm, warning that tariffs imposed by China could hurt key industries and have a negative impact on state economies.

That puts Republicans running for Senate in a tight spot as they grapple with whether to stick with Trump on tariffs or break with the president in favor of their respective states’ industries. 

“Owning Trump’s position means owning any potential trade war,” a Democratic strategist working on a top Midwestern Senate race told The Hill

That tension is already apparent in the North Dakota Senate race, where Heitkamp is running against Republican Rep. Kevin CramerKevin John CramerCastro, Steyer join pledge opposing the Keystone XL pipeline EPA proposes rolling back states' authority over pipeline projects GOP senator held up Trump aide's confirmation to get info on border wall contracts MORE.

Cramer addressed the tariffs in a tweet on Wednesday, calling for a “more measured approach” and criticizing the “impulse” that “created unnecessary turmoil.”

But Democrats pounced on that statement, pointing to the text of an earlier, later deleted tweet, where Cramer took a stronger tone by declaring his “opposition to tariffs that have the potential to harm North Dakota’s [agricultural market].”

Democrats running in competitive House races are starting to put pressure on vulnerable Republicans there, too. 

Former Rep. Brad AshfordJohn (Brad) Bradley AshfordJustice Democrats endorses two progressives challenging Democratic incumbents White men now the minority in pool of House Democratic candidates: analysis Pelosi sees defections from an unusual quarter — the left MORE (D-Neb.), who’s mounting a comeback for his Omaha-based seat, seized on the clash to link his opponent — GOP Rep. Don Bacon — to Trump’s trade war. In a tweet on Wednesday, he called on the agriculture sector to “express your opposition to Trump’s trade wars” by voting against Bacon.

Bacon answered on Friday with a statement that asked the White House to “find a solution to this tariff war with China” that both protects American intellectual property from China — a stated goal of Trump’s tariffs — while also allowing “Nebraska’s export agriculture economy of $6.4 billion to remain competitive and flourish.”

The White House has sought to downplay any political concerns related to the tariffs, pointing to the growing economy.

Top Trump economic adviser Larry Kudlow told reporters Friday that the administration’s “political success will rise and fall with the economy.”

“The economy is doing rather well now and I expect it to do even better, so I don’t necessarily with [agree] all the pundits about how bad the midterms are going to be for the GOP,” he said. 

“I’m not a tariff guy, but sometimes you need to use tariffs to bring people to their senses.”

Industry leaders are trying to convince the White House to scale back those tariffs, and Kudlow admitted that it’s “possible” Trump is using the tariff proposal as a negotiating tactic. Those leaders are encouraged by recent exemptions granted from steel tariffs.  

But Conant expressed the concerns of many Republicans who worry the market instability and potential adverse effects of the tariffs could muddle the GOP’s economic message in the fall. Before the tariff fight, Republicans had hoped that an economic boom following the GOP tax cuts would help blunt Democratic enthusiasm.

“If trade wars were good for the economy, we’d have them all the time,” he said.

“Democrats want the midterms to be about Trump’s behavior. Republicans want them to be about the economy and economic policies. If the economy goes south, Republicans have nothing to run on.”

Vicki Needham and Sylvan Lane contributed.