President Donald Trump\u2019s plan to use tariff revenue to bail out farmers could be stalled by the ongoing government shutdown.<\/p>\n
Trump said last month the administration would roll out subsidies<\/a> for struggling farmers using revenue from his sweeping tariff policies. The White House will imminently announce a bailout plan that could put up to $15 billion in farmers\u2019 pockets, Reuters reported<\/a>, citing anonymous sources. Trump has said the aid would come from tariff revenues, but experts say that\u2019s far easier said than done.<\/p>\n \u201cHow to fund this bailout is very complicated, and different than it was in 2018,\u201d Joe Glauber, former chief economist at the U.S. Department of Agriculture during Trump\u2019s first term, told Fortune. \u201cYou\u2019d need Congress to reallocate tariff revenues. USDA can\u2019t just say, \u2018We\u2019re going to take all that money and give it to farmers.\u2019 That takes an act of Congress, and that\u2019s tricky when the government isn\u2019t even open.\u201d<\/p>\n Trump\u2019s move to lend a hand to farmers mirrors his first administration playbook, when the agricultural industry was similarly battered by tariffs pricing American farmers out of global markets. According to a 2022 USDA report<\/a>, U.S. farmers lost $27 billion in agricultural exports between mid-2018 and 2019.<\/p>\n Glauber explained that during Trump\u2019s first term, the administration tapped unused funds from the Commodity Credit Corporation\u2014a Depression-era agency with a $30 billion spending cap\u2014to pay farmers about $25 billion<\/a> in 2018 and 2019. But that pool has already been stretched thin by recent income-support programs, and Congress hasn\u2019t yet replenished it this fiscal year.<\/p>\n Even if the White House found the money, the logistics are daunting.<\/p>\n \u201cYou can\u2019t just flip a switch,\u201d Glauber said. \u201cThe Farm Service Agency offices that process payments are closed right now. You\u2019d have to call back \u2018essential employees,\u2019 get new regulations written, and design a whole new program. That takes time and manpower, and you can\u2019t do that without a functioning government.\u201d<\/p>\n An ailing agricultural economy<\/p>\n The American agricultural industry is reeling from the impact of Trump\u2019s tariffs, which have hiked up prices of equipment<\/a> such as tractors and fertilizer, as well as led major imports such as China to snub U.S. farmers<\/a> in favor of countries such as Argentina and Brazil with lower export taxes. China received about a quarter of the U.S.\u2019s soybean exports in 2024, but it hasn\u2019t placed any orders<\/a> for the U.S. crop since May, according to U.S. Department of Agriculture data.<\/p>\n \u201cThe frustration is overwhelming,\u201d the American Soybean Association (ASA) President Caleb Ragland said in a statement<\/a> last month. \u201cThe farm economy is suffering while our competitors supplant the United States in the biggest soybean import market in the world.\u201d<\/p>\n While Trump argues that his plan will protect \u201cour great American farmers,\u201d Glauber cautioned that payouts can\u2019t repair the long-term damage of eroded trust in U.S. reliability.<\/p>\n \u201cChecks in 2018 and 2019 covered short-term losses,\u201d he said, \u201cbut the long-run consequence was that China stopped seeing the U.S. as a dependable supplier. Brazil\u2019s market share in China jumped from about 45% to 70%. Those shifts don\u2019t reverse overnight.\u201d<\/p>\n Glauber noted that while previous bailouts softened the blow, they also created a form of \u201cmoral hazard.\u201d<\/p>\n \u201cIt buys off the loudest group of protestors,\u201d he said. \u201cFarmers don\u2019t want to survive on bailout checks\u2014they want to sell their crops. But these payments let policymakers off the hook.\u201d<\/p>\n Other economists agree another major bailout would do no favors for farmers looking to regain global market share from South American competitors.<\/p>\n \u201cIt will compensate for the immediate economic losses due to tariffs, but it doesn\u2019t necessarily improve the long-term competitiveness of agriculture on the global stage,\u201d Wendong Zhang, an associate professor of applied economics and policy at Cornell University\u2019s SC Johnson School of Business, told Fortune.\u00a0<\/p>\n Pressures on the farm economy are meanwhile mounting: Farm operations filing for bankruptcy have inched up since 2022 and have continued to rise this year, according to the Federal Reserve Bank of Minneapolis<\/a>. In the second quarter of 2025, there were 93 filings, up from 88 the quarter before and about double that of 2024\u2019s fourth quarter, though filings are still below the record in early 2020, when 169 farms filed for bankruptcy. Margins for row-crop producers have thinned amid falling prices<\/a> and high fertilizer costs. Glauber worried that even if this new package goes through, it will be another temporary fix rather than a solution.<\/p>\n \u201cYou might compensate (for) losses this year,\u201d he said, \u201cbut if trading partners see you as an unreliable supplier, they\u2019ll go elsewhere. Prices can lure them back, but trust takes years.\u201d\n<\/p>\n