Midwestern farmers eye USMCA deal for relief amid China trade war
Uncertainty within the market is why some farmers in Nebraska are urging Congress to pass the proposed trade deal known as the United States Mexico Canada Agreement (USMCA).
The leaders of the United States, Mexico and Canada have already signed the most important trade deal in a generation. Mexico and Canada, not China, are currently our two largest trading partners. For the sake of America’s economy and workers, this deal needs to get done.
The only obstacle is political obstruction by congressional Democrats more intent on depriving President Trump of a win than bestowing one on the American people.
This is politics at its worst, and that’s saying something.
The United States stands to make immense economic gains from this comprehensive renegotiation of the deeply flawed 1994 North American Free Trade Agreement (NAFTA). The importance of the U.S.-Mexico-Canada Agreement (USMCA) is widely recognized on both sides of the political aisle, yet more than nine months after the signing ceremony, it lingers in Congress, unratified, undebated and uncertain.
As a “non-self-executing treaty,” both Houses of Congress have to pass the USMCA before it can take effect. Like all treaties of this magnitude, the deal deserves careful debate. But, given its broad popularity, the process should be much further along by now.
The question isn’t whether the deal is worth making, but rather why House Speaker Nancy Pelosi is preventing debate. Various Democratic lawmakers have suggested that they might wish to tweak certain aspects of the agreement, but so far they’ve largely avoided even learning about the details.
The reasons for ratifying the USMCA as quickly as possible are readily apparent. NAFTA was poorly negotiated, typical of an era of very bad trade dealings by American leaders that hurt the people they should protect the most.
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Sen. Rob Portman of Ohio and Rep. Jim Banks of Indiana — two Republicans from the heartland constituencies hit hardest by NAFTA’s shortcomings — both published very persuasive arguments this past week explaining why the USMCA is so beneficial for the United States.
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They point to the higher wages and labor protections that will be, for the first time, imposed on Mexican factories that produce goods for the U.S. market. Many Mexican auto workers, for example, will have to earn at least $16 per hour in order for the cars they make to qualify for tariff-free export to America. That will decrease incentives to offshore American manufacturing jobs and give workers in Detroit a fair chance to compete.
American farmers, meanwhile, will gain easier access to Canadian and Mexican markets — something they’ve been seeking in vain for decades.
But while Trump was the mastermind behind the USMCA, it’s not just Republicans who are convinced of the agreement’s merits, or at least eager to keep the ball moving forward. In July, 14 House Democrats signed a letter to Pelosi urging her to let the House vote on the USMCA before year-end.
We need to replace NAFTA, and Democratic leadership is the only thing standing in the way.
The principles behind this deal are neither partisan nor ideological — getting a better deal for American workers and requiring more robust labor and environmental protections from our trading partners are goals that the 2020 Democratic presidential candidates have explicitly endorsed, including Massachusetts Sen. Elizabeth Warren, even as she rejects the USMCA.
The Warren example sheds a revealing light on Pelosi’s obstructionism. It’s clear as day why Warren is opposing USMCA. She’s running for president against the man whose vision and determination made the deal a reality. Of course, she opposes it.
Warren’s cover story is that she thinks the USMCA is too lenient on pharmaceutical companies, but there’s no evidence the deal would actually raise drug prices for Americans. In any event, the place to bring up such concerns would be during open debate in Congress, where they could be addressed in the final deal, assuming Warren could get enough of her colleagues to share her tongue-in-cheek skepticism.
The same logic is at work with Pelosi. She is stalling, refusing to set a date, and dodging questions about whether it protects workers and the environment — despite the fact the USMCA has the most robust labor and environmental protections of any major trade deal the United States has ever signed.
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Like Warren, Pelosi’s opposition is just politics at its worst — and that’s saying something. If Pelosi really believes the protections are insufficient, then she and her allies should suggest modifications, or even pass USMCA and request that the U.S. trade representative work with our partners to improve the deal going forward.
The only reason Democrats are dragging their feet on the USMCA is because they wish to deny Trump a hard-fought win as we approach an election year. That Machiavellian approach is not what America’s economy and workers need right now. We need to replace NAFTA, and the Democratic Party’s leadership is the only thing standing in the way.