
Yesterday, Regional Strategic, Ltd. was asked to evaluate the effect shutting down the United States Agency for International Development (USAID) would have on demand for agricultural commodities in a specific area of the Midwest. We had to decline the project. After looking at available data, we found that, in shutting down the USAID website, the administration had denied citizens and the business community the ability to evaluate what had been lost and plan for the alternatives that remained.
The question is not trivial. It appears that USAID acquired approximately $1.8 billion in U.S. food products to support its activities in 2022. Every $100 million spent on food production and processing in the upper Midwest generates approximately
- $100 to $120 million in value-added economic activity within the Midwest
- $55 to $70 million in labor income
- $30 to $65 million in corporate profits and tax revenue
- 1,000 jobs
Any of these estimates could be increased 18 times to accommodate the $1.8 billion demand loss from eliminating USAID. All of these totals would go up if the impact was evaluated across the entire United States.
Clearly, local regions that are heavily invested in commodity production and processing would like to evaluate what portion of existing demand is being taken off the table:
- Every $100 million reduction in 2022 Iowa corn purchases in Iowa would have been equivalent to idling over 75,500 acres of 200-bushel corn
- A similar reduction for wheat in Kansas would have been equivalent to idling over 310,000 acres of 37-bushel wheat
The sudden lack of data with which to evaluate these impacts on local areas is a business issue. It is a family welfare issue. It is an employment issue. It is a public policy issue.
This is not limited to the situation involving USAID. In the first two weeks of the present administration, data access has been restricted in the areas of health care, climate, and weather forecasting where those data run counter to the administration’s political inclinations. This is bad for business, and it is dangerous.
Health data is being restricted at a time when the United States is experiencing a growing bird flu epidemic, Africa is experiencing renewed Ebola outbreaks, and drug-resistant tuberculosis is becoming more prevalent worldwide. Any one of these situations could rapidly become an international health problem. Any one of these is a personal safety issue. Each of these could rapidly become a workforce issue.
Weather and climate data are critical for construction, shipping, food production, tourism, energy distribution, and many other industries. Data on income, trade, consumption expenditures, and demographics are critical to any business doing market, workforce, or facility siting analysis. In any of these cases, businesses that rely on private vendor subscriptions are not immune, as their private vendors all depend upon public data sources as foundations for their models.
Given the rapidity of data “Disappearances” in the first two weeks of the administration, we don’t expect it to stop. There is plenty of information that contradicts the administrations political proclivities in the Bureau of Economic Analysis, the Bureau of Labor Statistics, the Census, the Energy Information Administration, the International Trade Administration, the Department of Agriculture and other agencies. We anticipate that many of these sources will disappear or become restricted in the coming months. Restriction of any one of these would have major implications for significant portions of the economy.
The situation is made more critical by online data access and delivery. Thirty years ago, data histories for all these sources were published and available in libraries across the country. That is no longer the case. Unless restrictions are anticipated and data is downloaded, catalogued, and stored, even data histories will be unavailable. The reduction in publication and distribution costs has resulted in more and better data over the intervening period, but it has also put citizens and business at risk under the current administration.
There has always been public data that made elected officials uncomfortable. The current difference is that the administration is not willing to address and live with its discomforts – opting instead to eliminate the evidence of its contradictions.
THIS IS A BUSINESS ISSUE. It is time for businesses to step up to help resolve it.
Those are my two cents. Spend them as you will.