Summary of "How USAID Cuts Hurt American Farmers"
Podcast: The Indicator from Planet Money
Host: Waylon Wong & Erica Barras
Release Date: February 19, 2025
Introduction
In the episode titled "How USAID Cuts Hurt American Farmers," hosts Waylon Wong and Erica Barras delve into the intricate relationship between the U.S. Agency for International Development (USAID) and American agriculture. The discussion centers on the repercussions of the Trump administration's decision to halt foreign aid, leading to significant layoffs within USAID and the broader implications for U.S. farmers.
USAID and the Trump Administration's Aid Freeze
The episode opens with the sudden termination of USAID by the Trump administration, resulting in the layoff of over 10,000 employees and contractors. Jordan Schimmerhorn, a former USAID contractor, shares her immediate response to the layoffs and her subsequent research into the agency's impact on American agriculture.
Jordan Schimmerhorn [00:38]: "I think it was a real choice to lay off 10,000 mission driven workaholics."
Without the agency’s support, approximately $500 million worth of U.S. crops were left unused, leading to significant waste as these commodities deteriorated in ports and warehouses globally.
Impact on American Farmers
Jordan Schimmerhorn embarked on a comprehensive research project to assess how USAID funding supports American farmers. Her findings reveal that USAID plays a pivotal role in purchasing vast quantities of U.S. crops for international aid and funding agricultural research across state universities.
Jordan Schimmerhorn [00:56]: "I've just been spending time trying to help build the evidence base for why USAID matters to the American people and why people throughout the country should care about it."
Despite the $2 billion annual expenditure on food aid—primarily involving rice from Louisiana and wheat from Kansas—this represents less than one percent of farmers' income from their crops. However, for specific sectors like sorghum (milo), government purchases are essential.
Michelle Erickson Jones [03:25]: "It's not like we're just giving this aid for the sake of giving dollars. We're also building those relationships because all of those bags say USAID. All of them say product of the United States."
Michelle Erickson Jones, a fourth-generation farmer from Montana, emphasizes the critical role USAID's food assistance programs play in her state's agricultural economy and international market presence.
The Food for Peace Program
A significant portion of the discussion focuses on the Food for Peace program, USAID's longest-running food assistance initiative, established post-World War II to address American grain surpluses and foster international goodwill.
President Eisenhower [04:08]: "Of food in the interest of reinforcing peace and well being of free peoples throughout the world."
Originally, the program aimed not only to alleviate hunger but also to open new markets for American agriculture and counteract the spread of communism by winning over allied nations through food aid.
Michelle Erickson Jones cites Japan and South Korea as success stories, where initial aid recipients transitioned into paying customers, thereby expanding U.S. agricultural exports.
Michelle Erickson Jones [05:41]: "Japan is one of our biggest customers. South Korea is one of the next biggest. And they are former USAID customers, one of the originals."
Legislative and Industry Responses
In response to USAID's abrupt shutdown, lawmakers from agriculture-heavy states, led by Senator Jerry Moran of Kansas, are advocating to transfer the Food for Peace program to the U.S. Department of Agriculture (USDA).
Senator Jerry Moran [07:03]: "USDA has boots on the ground and the infrastructure already in place to support the logistics for food assistance."
Moran argues that USDA possesses the necessary infrastructure to manage food aid logistics more effectively. However, Jordan Schimmerhorn expresses doubt about USDA's capacity to handle the nuanced, country-specific operations that USAID managed.
Jordan Schimmerhorn [07:48]: "Every senator wants to protect USAID's investments in their state. Turns out USAID funds a bunch of different things in a bunch of different states."
State Department's Stance and Legal Challenges
The State Department, now overseeing USAID, has indicated that it will continue programs aligned with national interests while discontinuing those that do not.
State Department Spokesperson [08:26]: "Programs that serve our nation's interests will continue. However, programs that aren't aligned with our national interest will not."
Amid these changes, a federal judge has intervened, ordering the Trump administration to temporarily lift the freeze on USAID funding pending a status report.
Waylon Wong [08:42]: "Last week, a federal judge ordered the Trump administration to temporarily lift its freeze on USAID funding."
As of the episode recording, there were no updates on the court's status report, leaving the future of USAID's funding and its impact on American agriculture uncertain.
Conclusion
The episode underscores the multifaceted role USAID plays not only in international aid but also in supporting American farmers by creating and maintaining export markets. The abrupt halt of USAID funding has ignited debates on the best way to manage food aid and support domestic agriculture, with significant implications for both national security and the agricultural economy. As legislative efforts and legal challenges unfold, the episode leaves listeners contemplating the delicate balance between foreign aid and domestic agricultural support.
Notable Quotes:
- Jordan Schimmerhorn [00:38]: "I think it was a real choice to lay off 10,000 mission driven workaholics."
- Michelle Erickson Jones [05:41]: "Japan is one of our biggest customers. South Korea is one of the next biggest. And they are former USAID customers, one of the originals."
- Senator Jerry Moran [07:03]: "USDA has boots on the ground and the infrastructure already in place to support the logistics for food assistance."
- State Department Spokesperson [08:26]: "Programs that serve our nation's interests will continue. However, programs that aren't aligned with our national interest will not."
This episode, produced by Julia Ricci with engineering by Jimmy Keeley and fact-checked by Corey Bridges, offers an insightful exploration into the intertwined destinies of USAID and American farmers, highlighting the broader economic and geopolitical ramifications of foreign aid policies.