To get the NAFTA reboot through Congress, President Trump will need Democratic votes.
The USMCA – the United States-Canada-Mexico Agreement, the trade deal that will serve as an update to NAFTA – has been signed by the heads of government of those three countries.
But the deal was negotiated before the U.S. midterm elections in November when Democrats took control of the House. And Congress has to ratify trade deals that the United States will be a party to before they can take effect. And the president and congressional Democrats don’t often get along! This could become a problem for the White House.
Enter President Trump, most famous before winning the 2016 U.S. presidential election for his supporting role in the 2002 romantic comedy Two Weeks Notice, who is now getting involved in whipping votes for the deal. The president is gonna rely heavily on his boys, the House Republicans, to move it. But even if he gets every GOP vote, it will still require Democratic support to gain a majority.
And yet that Democratic support is no sure thing. To begin, the deal will only get a vote in the House if Speaker Nancy Pelosi allows one. Bloomberg reports:
Pelosi is expected to only move the deal through the House if she can find a critical mass of her caucus supporting it and if she extracts concessions unrelated to trade from the White House in return, senior congressional aides say.
The administration is trying to build that critical mass. U.S. Trade Representative Robert Lighthizer, President Trump’s chief trade negotiator, has spent time on Capitol Hill meeting with House Democrats to try to assuage their concerns about the deal – particularly its provisions on the environment, pharmaceutical drug prices, enforcement and labor.
Democrats, meanwhile, have been holding hearings to explore those concerns. And on Tuesday those concerns focused on the USMCA’s labor provision. The House Ways & Means subcommittee on trade heard testimony from unions, think tanks and trade associations on this topic, and more than one witness said:
1. Mexico’s low manufacturing wages, which have weighed down wages across the North American continent, must be raised, and
2. this needs to be done before the American labor movement will lend its support to the USMCA.
Rep. Dan Kildee (D-MI) asked Josh Nassar, legislative director of the United Autoworkers, about Mexico’s wage and labor obligations under USMCA. Here’s what Nassar said:
"I think people need to understand how bad it is in Mexico. There’s a BMW plant there, for example, and the workers there were signed to a contract that they never saw and the plant wasn’t even operating yet. Because you have these company unions that dominate in Mexico. That is why wages are so low – they’re closely associated with the government.
"Is this really gonna break it up? Is this gonna break up that system? I can’t tell you that it will. And that is why we need to see action first. And not just promises, but actual action."
He went on:
"A lot of the pressure to keep the Mexican laws so weak comes from US corporations. And it’s not a matter of fact at all that US companies have done poorly by NAFTA. Many have done quite well. It’s workers in all three countries that have done poorly. That’s a fact."
And this is only on how USMCA handles labor rules. Sounds like the Trump administration may have some work to do to win Democratic support for its trade deal.
If you've got the time and this is your kinda thing, watch the whole hearing here: