The Trump administration has pitched the bailout as a short-term measure designed to help U.S. farmers survive the trade spat with China. The Chinese government this July imposed retaliatory tariffs on a range of U.S. exports, including 62 percent tariffs on U.S. pork products.
To help affected farmers, the Agriculture Department has said it will buy $1.2 billion of surplus food from farmers for distribution to food banks across the country, including $559 million in pork products. Earlier this week, USDA officials told The Washington Post that Smithfield is on the list that can apply to sell under this new program.
The USDA has also started sending direct cash payments to farmers affected by the trade downturn, and will spend an additional $200 million to promote U.S. exports in foreign markets.
Grassley has not yet talked to the White House about changing the rules to exclude Smithfield from the bailout, but he is considering doing so and may take action at a later date, said Michael Zona, a spokesman for Grassley. The GOP Senator is looking into reported connections between WH Group and the Chinese government -- ties some congressional lawmakers probed when Smithfield was acquired in 2013.
“[Grassley] cares a lot about fundamental fairness when it comes to these programs,” Zona said. “And it appears that taxpayer money will go to a state-owned enterprise as a result of that state’s tariffs.”
Smithfield has not confirmed that it is applying for bailout money, but a spokeswoman said earlier this week that “any approved vendor that can supply the requested product can bid for the contract.” Smithfield did not immediately respond when asked about Grassley’s remarks.
Grassley, a farmer who owns land in Iowa, has been critical of the Trump administration’s trade war but confirmed last month that he will himself be requesting money under the bailout program.