Monday, April 29, 2019

Will Trump Blow Up North American Trade to Beat the Democrats?

President Trump’s push to revamp North America’s trade rules ( USMCA ) is hitting a roadblock in Washington as Democrats and labor groups demand changes, reports The Wall Street Journal.

As Congress returns from recess this week with a full plate of priorities, House Speaker Nancy Pelosi (D., Calif.) and other prominent Democrats have signaled they won’t allow a vote on the administration’s new agreement with Canada and Mexico without certain changes, according to The Journal.

Democrats said they want to make it easier to enforce new rules designed to strengthen labor rights in Mexico, saying a lack of worker protections there is hurting wages and job prospects for U.S. workers.

Got that, the Democrats want to dictate terms of employment in Mexico!

In other words, they want to make it more difficult for firms to operate in Mexico, which would benefit U.S. unions.

Then there is this. From The Journal:
[W]ith the U.S. election season approaching, some Republicans and trade experts said Democrats may be seeking in part to deny Mr. Trump a political win—or at least to exact a heavy price for advancing the deal.
Trump could choose the crazed atomic bomb solution and just blow up North American trade.  More from The Journal:
Under trade law known as “fast track,” Mr. Trump could submit USMCA to the House and Senate for an up-or-down vote with no amendments allowed. Still, in 2008 Mrs. Pelosi changed House rules to prevent such a vote on a free-trade agreement with Colombia, and aides said she likely would do that again if the Trump administration doesn’t address Democratic concerns on USMCA.

Threats by Mr. Trump to withdraw from Nafta could lead to a deal on USMCA with the Democrats, former officials say, but such tactics could also threaten the very existence of North America’s free-trade zone.

“I take the president at his word,” said Mr. Cox, the Republican political operative. “He said he’ll tear it up.”
Best guess: Democrats block the passage of USMCA but Trump does not push the nuclear button. The current NAFTA agreement stays in effect.

-RW



1 comment:

  1. "Democrats said they want to make it easier to enforce new rules designed to strengthen labor rights in Mexico, saying a lack of worker protections there is hurting wages and job prospects for U.S. workers."

    A cynic might note that, through their trade-agreement stance, the Democrats want to make it harder for Mexican workers to find employment in Mexico, thereby helping US unions, and through their immigration stance, make it easier for Mexican workers to find employment in the US, thereby hurting US unions.

    ReplyDelete