The End of the Trail: RealEcon Makes Its Final Stop of 2024 in Oregon

The RealEcon team at CFR visited Oregon in early December as our final listening tour stop of 2024. We made stops in Portland, The Dalles, Salem, and Roseberg, and talked to state representatives, economic development officials, the CEO of a multinational company, farmers and rural development officials, local journalists, community college students, the president of a Native American tribal development corporation, and the executive director of a forestry association. We also toured a family-owned timber mill that produces veneer.

Trade is vital to Oregon’s economy, with one-fifth of jobs tied to goods flowing in and out of the state. Computers and electronic products are the state’s most exported goods, with Intel its largest exporter. Agricultural products—such as cherries, pears, wheat, and wine—and seafood—including shrimp, Dungeness crabs, salmon, whiting, hagfish, and albacore—are also important.

Interestingly, most of the seafood consumed in the state is imported, while most of what is caught in Oregon is exported. That is in part due to dietary preferences: for example, Americans tend not to eat hagfish, but in Korea it is a highly sought-after delicacy, making the Korean market indispensable. If high tariffs forced Oregan to sell more of its seafood domestically, the industry would need assistance and a massive marketing campaign to encourage Americans to change their dietary habits.

Columbia Sportswear and Nike are headquartered in Oregon and owe a great deal of their success to trade. Those companies sell a high percentage of their goods to markets all around the world. Although they mostly design their products in the United States, the majority of their manufacturing is done in other countries. According to one person, despite the advantages of shorter supply chains and lower shipping costs, manufacturing those goods in the United States is not feasible, as the permitting process to build new factories is arduous and there is not enough domestic labor to fill the required jobs.

Oregon’s rich natural resources and fertile land make agriculture a vital industry for the state. Cherries, pears, apples, blueberries, wheat, and hazelnuts are among the main produce grown, and in many cases exported. One grain distributor we spoke to exports 95 percent of his product. A cherry grower explained that because growers can get top dollar for the best fruit through exports, they are able to sell the rest of their output domestically, where otherwise it would not be cost-effective.

Some of the challenges facing agriculture that we heard about in Oregon include labor shortages, regulation, and poor port infrastructure. Due to a lack of local labor for seasonal work, Oregon producers often turn to migrants, but we were told that strict visa requirements make doing so costly and difficult. To meet those requirements, farmers need to predict in the spring how many workers they will require in the fall to be considered for the limited number of relevant visas available. Moreover, H2A visas for picking and H2B visas for processing are not interchangeable, so growers cannot use the pickers who are already on the farm to help with processing. All of that makes labor much more costly. In addition, the port in Portland no longer accepts produce for shipping in containers, so companies must instead go to ports in Washington or California, which are more expensive.

As in other states, we heard appeals for more rural investment in schools, roads, broadband, and other infrastructure. Although the people we talked to acknowledged that a lot of federal money is available for rural communities, they found it difficult to access those funds as the application and reporting processes are onerous. Many rural communities do not have the manpower, time, and resources needed to apply.

Federal government policies also impact Oregon’s Native American tribes. Specifically, a representative from one tribe explained that the Joe Biden administration’s decision to change the policy that required tribes to undergo a two-part process to purchase and take into trust non-ancestral lands has done unintended damage. Tribes are now buying other tribes’ properties and competing against each other for land. That policy has also decreased taxable land, limiting revenue for the state.

Oregon’s storied timber industry has its own unique perspective on trade and globalization. In the 1990s, half of the state’s lumber mills closed, resulting in thousands of jobs lost in rural communities. Massive lumberyards that previously spanned the Oregon coast moved to Asia due in part to low labor costs, low costs of entry, and tax advantages. Some companies have built timber mills on massive ships floating in international waters, enabling them to avoid taxes. The Canadian government’s subsidization of logs for its timber industry, which reduces 75 percent of costs for producers, makes it difficult for American timber companies to compete.

Trade and globalization are not the only challenges facing Oregon’s lumber industry. Fires have increasingly plagued Oregon’s forest. One person we spoke to attributed the increase in fires to changes in climate and the lack of people in forests (who could put out a fire if they saw it). Another person argued that the fires are the result of not clearing out forests properly. Environmental regulations were also cited as a challenge to the timber industry. For example, we heard complaints about the prohibition on cutting down trees in a one-hundred-mile radius of a spotted owl—a regulation going back to the Bill Clinton administration—especially when, it was argued, the spotted owl’s existence is more threatened by the non-native barred owl.

Oregon was the final stop of RealEcon’s 2024 listening tour. Since March, we have traveled to Florida, Wisconsin, western Pennsylvania and New York, Arizona, and Massachusetts and New Hampshire, all to help us understand what Americans across the country think about U.S. involvement in the international economy. The team is extremely grateful to everyone across the country who helped set up meetings and took the time to provide us with their insights, which have given us invaluable perspective on U.S. engagement in the international economy and how Americans view it. We hope to dive more deeply into the themes we heard on our tour and to factor them into our work in Washington, DC, on international economic policy.