Trump's trade war may have helped Democrats win the House

Minnesota's 8th Congressional District, which runs along the US-Canada border, has one of the highest concentrations of iron miners in the country. Republicans took it from Democrats in Tuesday's mid-term election amid a surge in the industry propped up in part by President Trump's tariffs on China.

Minnesota's 2nd Congressional District, which stretches south of the Twin Cities, includes a large concentration of soybean producers. Republicans resolved that district Tuesday after the Democratic candidate campaigned on the idea that the president's policies were devastating its farmers.

"Family farmers in our district saw reliable markets disrupted by impulsive and unpredictable trade decisions," said Democrat Angie Craig, who unseated Rep. Jason Lewis (R). "I heard a lot of the same things: They're a member of the trade war."

Democratic candidates across the country tried to leverage fears about Trump's trade policies in their campaign pitches to voters. In Senate races, most Democrats who tried running on those sentiments are lost. But in House races, such candidates fared much better and may have helped swing control of the Democrats, underscoring the mixed political ramifications or one of the administration's key economic policies.

"It's very clear, based on how we have lost seats in the Upper Midwest, that declining agricultural markets are likely to be led to the overturning of the GOP majority in the House," said Joe Brusuelas, an economist with RSM, an international accounting firm. "It's hard to imagine that these seats would have flipped anyway."

Democratic congressional candidate Cindy Axne beat incumbent Rep. David Young (R) in Iowa. (Scott Morgan / Reuters)

In March, Trump slapped 25 percent of tariffs on steel and aluminum imports to the United States, followed by two separate rounds of tariffs – one on $ 50 billion in products and another on $ 200 billion in products – on China.

China, Mexico and other foreign governments have retaliated by imposing their own tariffs on U.S. exports, in many instances in areas where they might hurt the president's domestic political fortunes.

They targeted Midwestern farms that export to Chinese markets, Harley-Davidson motorcycles manufactured in the Rust Belt, and even bourbon produced in Senate Majority Leader Mitch McConnell's home state of Kentucky, among other businesses in Republican-controlled states.

In several key races, especially at the statewide level, those who have failed to effectively hurt the president or his party. Sen. Joe Donnelly (D-Ind.), Who tried to manage immigration and other issues, said the administration's policy had "gone too far" and was hurting businesses in Indiana. He lost by 8 points.

Other Senate Democrats with similar fates. Sen. Heidi Heitkamp (D-N.D.), who declined the trade war's impact on the state's many soybean farmers, lost by double digits. Sen. Claire McCaskill (D-Mo.) Expressed alarm that the White House tariffs were on the verge of putting a nail out of business but was handily defeated by state Attorney General Josh Hawley (R). Moreover, the New York Times found that Republicans maintained control of 17 of the 25 districts most reliant on agricultural jobs.

"This was supported by foreign governments that had supported Trump, and it simply did not work," said Jock O'Connell, economist with Beacon Economics. "These areas, by and large, stuck with the President and their Republican members of Congress."

But in other races, several analysts, candidates and campaign aides said, frustrations over the trade may have helped push Democratic candidates over the top. They pointed in particular to races along the Upper Mississippi Valley, which encompasses northwest Illinois, northeast Iowa, southeast Minnesota and southwest Wisconsin.

Two of Democrats' House pickups came from Iowa, where Abby Finkenauer beat incumbent Rep. Rod Blum (R) and Cindy Axne beat incumbent Rep. David Young (R). J.D. Scholten, a Democrat running against Rep. Steve King (R), lost but came closer than Democrats had in the last several cycles against King, a 15-year incumbent.

Farmers in Iowa districts who have voted Republican and supported Trump before they were this year "because of the tariffs," said Aaron H. Lehman, President of the Iowa Farmers Union.

"In Iowa, critics of the administration's trade policy, I really did in this election," Lehman said. "Some of the Republicans were very critical of the president's stance, but they had to be very delicate in their criticisms – ultimately that showed up on Election Day as well."

In Northern Illinois, Democrat Lauren Underwood, 32, criticized the impact of Trump's trade war on local soybean farmers and pulled off a surprise upset over an incumbent Republican. In Minnesota, Democrat Dean Phillips defeated GOP incumbent Erik Paulsen in the 3rd District, while the Democrat Craig beat Lewis in the 2nd District after losing to him in 2016.

"I think it helped immensely with agriculture support," Kevin Paap, president of the Minnesota Farm Bureau Federation, said of Craig's victory over Lewis. "I heard from members, I like that and understands and supports trade."

Soybeans are a major. export, especially to China. The tariffs have turned Chinese demand "anemic," according to an analysis by the Agriculture Department. U.S. soybean exports to China fell from more than 2.5 million tons in September 2017 to 67,000 tons in September 2018, it found.

About 61 percent of voters said in a Gallup poll last week that U.S. trade and tariff policies were "extremely important" to their vote, although health care, the economy, immigration and other issues. Exit polling consistently found health care, rather than trade, to be the most important issue to voters.

There were some areas where Trump's tariffs may have been rather than his party's candidates. Minnesota's Iron Range, in the northern part of the state, is in the midst of an "economic revival," the Minneapolis Star Tribune reported this summer, in part because Trump's tariffs have pushed the cost of domestic steel and driven up profits. That revival played a large role in helping Republican Pete Stauber win a seat that Democrats had held since 2011, according to Stauber staffers.

"The president's agenda is definitely resonated in this mining-heavy district," said Caroline Tarwid, Stauber's press secretary.

Farmers who are "die-hard" Trump supporters were largely unhappy because of the trade issue, said Anne Schwagerl, a 33-year-old soybean farmer in Minnesota. In general, she said, Trump voters were persuaded by the president's pitch that the trade was a temporary measure to create better trade deals.

But that argument was less persuasive to those who already had their doubts about Trump.

"For some moderates who pay their operating loans," Schwagerl said. "For anyone who is a moderate, it was hard to buy the 'short-term pain for long-term gain' argument."