Federal aid to paper over trade war losses motivated by “presidential politics”

New reporting Thursday from Maine Public reveals that key lobster industry stakeholders who suffered the most direct losses from Trump’s failed trade war with China were left out of the administration’s attempts to brush aside the damage he’s inflicted on Maine’s lobster industry. 

Live lobster dealers and processors, who process, ship, and pack lobsters called the federal aid package a “slap in the face” to be “not included in this whatsoever.” Even some lobstermen eligible to receive aid called the deal “pandering” while those hit hardest continue to suffer from the fallout from Trump’s failed trade war.

Maine Public: Lobster Dealers, Processors Say They Were Left Out Of Federal Aid Deal — And Some Blame Politics

By: Fred Bever
September 10, 2020

Key Points:

  • A federal award of some $50 million to Maine lobstermen to compensate for losses created by the U.S. trade war with China is upsetting live lobster dealers and processors who were left out of the equation. Even some lobstermen are questioning the formula — and some observers see one key motivation behind the decision: presidential politics.
  • Over the course of the tariff tit-for-tats between the United States and the Chinese since 2017, the value of U.S. lobster exports to China dropped precipitously. Now, as part of a broad seafood harvester relief program, the U.S. Department of Agriculture will offer lobstermen a 50-cent-per pound payment for their landings in 2019 — or as much as $50 million for the state's overall harvest last year.
  • "My issue with it is it's hitting the wrong year. We had a good price last year, regardless of the trade issue," says Long Island lobsterman Steve Train. Train notes that in 2019, lobstermen saw the best boat price ever recorded, averaging $4.82 a pound. The USDA assistance might make more sense, he says, if it was based on 2017.
  • "But if the formula they use says we lost money because of the trade thing then that's the formula they use. But yeah, it seems like...pandering."
  • Live lobster dealers and processors, meanwhile, are incredulous that they were left out of the equation. After all, they are the ones who process, pack and ship the product, and who suffered the most direct losses from the trade war.
  • "I'm not saying that the fishermen shouldn't be allocated funds based on that,” says Shawn McEwen, CEO of Sea Salt Lobster Wholesalers in Saco. “But it's really a slap in the face for the dealer network and the other people that were exporting to be not included in this whatsoever."
  • McEwen says lobstermen may have seen intermittent price variations at the dock since 2017, but when the Chinese tariffs first hit, it was like turning out a light. The company lost millions of dollars in sales and was forced to lay off two shifts.
  • One advocate for the wholesalers said in a blog that the lobstermen were not the ones to feel the pain from the tariff war. McEwen says at the very least, the USDA and White House appear to be poorly informed about the true dynamics of the lobster industry. He also thinks there may be some politics at work. "There's lot more lobstermen than there are dealers. That's a lot of votes."