Trump to force Congress to find NAFTA replacement
President Donald Trump put pressure on Congress to approve his new trade deal with Canada and Mexico, saying late Saturday he intends to terminate the original North American Free Trade Agreement.
That would leave Congress with two options: approve the United States-Mexico-Canada Agreement, or risk having no trade deal in place.
“I will be formally terminating NAFTA shortly,” Trump told reporters aboard Air Force One on his way home from the G20 summit in Argentina.
“We get rid of NAFTA. It’s been a disaster for the United States. It’s caused us tremendous amounts of unemployment and loss and company loss and everything else,” he added.
Trump, along with Canadian Prime Minister Justin Trudeau and outgoing Mexican President Enrique Peña Nieto, signed a new deal on Friday after more than a year of negotiations.
But their respective legislative bodies still need to approve the agreement, known as USMCA, before it goes into effect.
Trump can formally withdraw from NAFTA six months after he notifies the other two parties. He will need Democrats to support the USMCA, especially in the House where the party will take control in January.
White House officials have expressed optimism that a new wage requirement for auto workers, as well as a provision addressing Mexican workers’ rights would bring Democrats on board. But some party members remain unconvinced that those provisions are enforceable.
Rep. Nancy Pelosi, who Democrats have nominated for House speaker next year, called the deal a “work in progress” on Friday. She said it isn’t something Democrats “can say yes or no to” just yet.
Ohio Democratic Sen. Sherrod Brown said Sunday on CNN’s “State of the Union” that he wants the new agreement to have stronger labor standards and protections against outsourcing.
“The work is not done yet,” Brown said. “I understand the President said it’s final. The President needs to talk to Congress on this. We can go back to the table with the Mexicans and the Canadians and do stronger labor standards.”
Some Republicans are skeptical of the USMCA, too. Pennsylvania Sen. Pat Toomey said this week that the new deal isn’t as good as the original NAFTA, but that he could support it with a “few tweaks that move it in the direction of a more pro-trade agreement.”
Congress can suggest small changes to be made to the legislation without sending the three parties back to the negotiating table. They are likely to wait for an economic impact study from the United States International Trade Commission before voting on the deal. The commission has 105 days, or until mid-March, to release the report to Congress.
At a two-day hearing held last month, the ITC heard from a number of groups that would be affected by the deal. Some auto makers are concerned that a new rule requiring more of a vehicle’s parts to be made in North America could be complicated and costly to comply with. Apparel makers said a new provision could make it harder to manufacture clothes inside the region, and fruit and vegetable growers argued that the deal does nothing to protect them from lower-priced produce coming from Mexico.
Dozens of industry groups, ranging from manufacturers to farmers, have lobbied the administration to remove separate tariffs on steel and aluminum imports before the USMCA goes into effect. They argue that the taxes could cancel out any benefits generated by the new trade deal.