When President Donald Trump signed a new agreement to replace NAFTA, a lot of people who depend on borderless commerce — many of them Midwest exporters of manufactured and agricultural goods — breathed a sigh of relief. After 15 months of arduous negotiations, the specter of harmful trade barriers rising on our northern and southern borders was finally gone.
So we thought. But a year later, the United States-Mexico-Canada Agreement has yet to come into effect. That’s mainly because the U.S. Congress has yet to approve it. The main inaction is in the House. Speaker Nancy Pelosi, who in November said, “I would like to see it done this year,” has since indicated the House probably won’t stick to that schedule.
But Pelosi should use all means at her disposal to see that it does. Rep. Mike Quigley, D-Ill., tells us, “I think we have time, and we have bipartisan support.” What is needed, he says, is a recognition by House members that in trade deals, “you don’t get everything you want.” Compromise is the name of the game.
The new accord, also signed by Mexico’s then-President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau, doesn’t live up to Trump’s boast of being “the largest, most significant, modern and balanced trade agreement in history.” But it would preserve a free trade zone that has boosted trade, promoted economic efficiencies and lowered costs for consumers. And the USMCA includes some useful improvements over the 1994 NAFTA deal.
So let’s all agree: This trade pact isn’t perfect — as if others are. But it’s better than the status quo, and better than any plausible alternative.
Putting off approval until 2020 would make Democrats complicit in the needless trade uncertainty that Trump has created.
His tariff policies in particular discourage investment and hiring, and make business planning far more difficult than it should be. Leaving USMCA on the shelf also could provoke the mercurial president to simply abandon NAFTA, a step that would create chaos in the North American marketplace.
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American farmers, whose net farm income has plunged by 50% since 2013, have enough trouble lately with bad weather and low prices. They don’t need the additional stress of wondering whether they’ll be able to sell to Mexico and Canada — which together bought $2.8 billion worth of Illinois’ agricultural goods last year.
USMCA also would help Midwest factory workers — and increase their numbers. The Washington Post reports that: Automakers would face the biggest changes once the new agreement takes effect. The USMCA requires more made in the USA content and mandates that 40% of each vehicle be produced by workers earning $16 per hour — a provision that is likely to draw jobs away from lower-wage Mexican workers.
Pelosi’s delay in advancing the trade deal invites Republican criticism that the Democratic-controlled House is too obsessed with impeachment to take care of other matters that have a more direct bearing on the lives of most Americans.
Pelosi has insisted that her members “can walk and chew gum.” But right now it looks as though they are forfeiting an easy achievement in their pursuit of something unattainable — Trump’s removal.
An analysis by the International Trade Commission, an independent federal agency, concluded that it would stimulate economic growth and job creation across “all broad industry sectors within the U.S. economy.” The total yield, by the agency’s calculation: a $68.2 billion increase in gross domestic product and 176,000 additional jobs.
Last week, Trump complained to news reporters that the USMCA was “sitting on Nancy Pelosi’s desk.” The speaker retorted that she’s waiting some final decisions from Trump’s U.S. trade representative.
Maybe so. Maybe, too, she could ask one of her staffers to get final answers. Fifteen months after Trump cut this deal, all those Midwest farmers and factory workers aren’t looking for House Democrats’ excuses. They’ve waited too long for a simple action.
Going into an election year, Democrats can look distracted by impeachment and inattentive to Americans’ economic concerns. Or they can take the USMCA win and prove the doubters wrong.