Trade war hits state’s House elections

Jon Camacho is a fourth-generation San Joaquin County almond farmer who says he will “have to borrow money to stay alive” if he doesn’t get a slice of the $12 billion the Trump administration is promising to farmers affected by the president’s tariff wars with trade partners.

One of Camacho’s biggest buyers is China — or it was, until President Trump imposed taxes on a range of Chinese imports, and Beijing responded by slapping tariffs on U.S. farm products, including almonds. With the Chinese market drying up, there’s a glut of U.S. nuts, and the price of Camacho’s product is plummeting.

As first proposed, however, Trump’s assistance package wouldn’t cover almond growers. Or citrus growers, who also make up a big share of California’s farmers — and are looking to Trump-friendly Republican congressmen for help.

Camacho’s congressman, Rep. Jeff Denham, “listens and he seems down to earth,” said Camacho, who has voted for the Turlock (Stanislaus County) Republican in the past. But if Camacho doesn’t get federal aid for his 10-acre farm in Ripon, he said, Denham “will lose my vote” in his bid for a fourth term.

Camacho’s promise is a sign of how Trump’s trade wars could affect Republicans in Central Valley congressional districts that the GOP needs to win in November to have a good chance of keeping control of the House. GOP incumbents are being squeezed between supporting Trump and his agenda, and doing right by the farmers they represent.

Trump says he intends to offer $12 billion in aid to farmers whose crops are being hit with tariffs of up to 51 percent on their products. The foreign taxes were in response to tariffs that Trump ordered on products from countries including China, Mexico, Canada and members of the European Union because of what he called unfair trade practices.

Trump says the strategy is sure to work and has pleaded with farmers and others in the U.S. who are being hit by retaliatory tariffs to be patient.

“You’ve got to stick it out,” he said last week at a rally in Kansas City, Mo. “The farmers are going to be the biggest beneficiaries. Just be a little patient.”

In the meantime, the U.S. Department of Agriculture said, producers of “soybeans, sorghum, corn, wheat, cotton, dairy and hogs” would qualify for direct aid. That leaves out top California exports like almonds and oranges.

No state is affected by the trade war more than California. It exports more than $45 billion a year in agricultural products, $28 billion of that to China. Many of the state’s biggest growers are in congressional districts that have long been held by Republicans, and they’re pressuring the current batch of incumbents to work the White House for aid.

“This is a Republican administration,” said Dennis Nuxoll of the Western Growers Association, which represents California farm interests in Washington and opposes Trump’s tariffs. “The key to this is Republicans.”

In the spotlight are House Majority Leader Kevin McCarthy of Bakersfield, whom Trump has called “my Kevin,” and Rep. Devin Nunes, R- Tulare, chairman of the House Intelligence Committee and one of the president’s most vocal defenders. Other integral players include Denham, a member of the House Agriculture Committee, and Rep. David Valadao, R-Hanford (Kings County), a dairy-farm owner.

Denham and Valadao are facing tough re-election fights, and even Nunes, whose district has more Republicans than Democrats, has a credible challenger. McCarthy has an easier path to re-election, and he hopes to become speaker if Republicans hold the House.

One expert says the aid the Trump administration is offering to farmers won’t come close to covering their trade-war losses — no matter where they live.

“I don’t think there is any way that $12 billion will make whole these big commodities,” said Daniel Sumner, a professor of agriculture and economics at UC Davis and director of the university’s Agricultural Issues Center.

He estimates that California agriculture could lose up to $4 billion in produce crops like tree nuts and citrus because of other nations’ retaliatory tariffs. The state’s almond farmers are especially worried about the $500 million worth of their product that they export annually to China.

“There is a point in this tariff war where the damage cannot be undone,” said Elaine Trevino, president of the Almond Alliance of California, which represents 450 members of the industry. “If we were to see that China market close, that could be huge.”

A leader of California’s citrus industry, which exports $130 million worth of oranges to China annually, said growers are already feeling the impact of tariffs. Joel Nelsen, president of California Citrus Mutual, which represents 2,500 of the state’s 3,500 growers, has a simple request for the California congressional delegation:

“All we need them to do is tell the administration, ‘You need to work this out to help my constituency,’ ” Nelsen said. “Work something out.”

Some Republicans are starting to push back on the administration, careful to strike a balance between not alienating Trump and his itchy Twitter finger and responding to their constituents.

“Without free and fair trade, our Central Valley growers need emergency aid to stabilize our agriculture,” Denham said Wednesday. “I’m fighting to ensure our specialty crop farmers receive equal aid to protect our farms and our economy. Ultimately, our farmers need access to more markets and free trade. ”

On Tuesday, 10 California House members — including Denham, Valadao and Nunes — signed a letter to Agriculture Secretary Sonny Perdue warning that retaliatory tariffs have already cost their constituents $2 billion.

“We strongly urge that specialty crop farmers be given the same forethought as other tariff-impacted commodity sectors,” the House members wrote. “Specifically, they should receive a share of the $12 billion mitigation funding that is adequately proportional to the damage they will face from retaliatory tariffs.”

Valadao, who has spoken to Vice President Mike Pence and Perdue, told The Chronicle that “these broad tariffs are having serious consequences on farmers.”

While the aid package “will provide interim relief for some farmers,” Valadao said, “we must recognize that this is not a long-term solution.”

His Democratic election opponent, T.J. Cox, was not impressed.

“All these guys are doing is writing letters. That’s not leadership. Those letters go directly in the round file,” said Cox, who owns an almond processing plant in Madera. “What they should be doing is get together a valley coalition and drive a bunch of tractors down Pennsylvania Avenue and start advocating directly to the White House.”

Nunes and 19 other House Republicans urged Trump last week to negotiate directly with Chinese President Xi Jinping. “We are confident that if you personally engage with President Xi, you would reinvigorate the negotiations and develop meaningful solutions,” they wrote in a letter to the president.

Nunes told The Chronicle in an email that “while the aid for farmers is useful, I don’t believe farmers want aid — they want to be able to sell their goods freely without discrimination. And we’re working hard to make China abide by those rules.”

The Democrat challenging Nunes in November, Fresno County prosecutor Andrew Janz, says the Republican incumbent is siding with Trump at the expense of his district.

“Any first-year econ student knows that creating a trade war is not a way to open up your markets,” said Janz’s campaign manager, Heather Greven. “Everybody knew this would be a disaster for Tulare and Fresno counties.”

Farmers like Camacho are stuck in the middle of the politics. Over the past month, Camacho has watched the price of almonds drop 30 cents from the $2.45 a pound he received last year. He budgets a baseline of $2 a pound to break even. Hitting that target is looking less likely every day.

“I understand that President Trump is trying to do the best thing for our economy, and I support that,” Camacho said. “But it is definitely affecting me. In my situation as a smalltime farmer, without any aid, I will be in trouble.”

Joe Garofoli is The San Francisco Chronicle’s senior political writer. Email: jgarofoli@sfchronicle.com Twitter: @joegarofoli