The Trump administration has said it will provide up to US$12 billion in aid to U.S. farmers to protect them from the trade war the president began earlier this month by placing tariffs on approximately US$34 billion of Chinese imports.
China immediately hit back with a 25 percent tariff rate on 545 US products, also worth a total of US$34 billion, targeting farm exports in midwest states that supported President Donald Trump most during the 2016 election.
The world’s largest trading nation has canceled many orders for U.S. soybeans and other agricultural products since the trading spat started months ago.
Secretary of the U.S. Department of Agriculture, Sonny Perdue will be distributed as a commodity subsidy and does not require congressional approval.
"This obviously is a short-term solution that will give President Trump time to work on a long-term trade policy," Perdue said.
In a speech in Kansas City, Missouri on Tuesday, the president defended his trade policies.
“We have to do it," Trump said, criticizing both China and the European Union for supposedly treating the U.S. "unfairly" in trade deals over the years. Over Twitter, Trump threatened to retaliate with tariffs against any country not treating the country "fairly on trade negotiations."
"But it's all working out," the president assured the crowd, "just be a little patient," he added.
The president is on a Midwest tour this week campaigning for Republican congressional candidates running in the upcoming U.S. midterm elections in November.
However, Republicans generally resist such large-scale federal subsidies that the president is proposing and are criticizing the farmer bailout.
"This trade war is cutting the legs out from under farmers and the White House's 'plan' is to spend $12 billion on gold crutches," said Senator Ben Sasse, a Nebraska Republican.
"Tariffs are taxes that punish American consumers and producers," said Kentucky Republican Senator Rand Paul, an original Tea Party movement member. Paul tweeted, "If tariffs punish farmers, the answer is not welfare for farmers — the answer is remove the tariffs."
Democratic U.S. Representative Jackie Speier of California, a major agricultural state, told the president over twitter, "OK @POTUS - you created this mess with your trade war and now you are going to spend $12 billion to placate the farmers that voted for you," she tweeted.
President Trump had hundreds of U.S. made products put on display at the White House on Monday to ring in his newly declared July 16-22 "Made in America Week," celebrating "craftsmen, innovators, and producers."
The U.S. head of state also threatened to slap another US$500 billion in tariffs on Chinese exports in an effort to preserve U.S. industry.
Several Latin American presidents and delegates gathered on in Mexico on Tuesday to deepen commercial and trade deals amongst their individual countries in order to counteract Trump’s trade attacks.
Leaders of the Pacific Alliance, comprising Mexico, Chile, Colombia, and Peru, agreed with the Mercosur bloc — Brazil, Argentina, Uruguay, and Paraguay — to explore new ways of economic trade and cooperation.