Out with the old: Trump to kill existing NAFTA text to push Congress to approve USMCA

WASHINGTON — The original NAFTA deal is back on top of Donald
Trump’s hit list, with the U.S. president declaring he intends
to terminate the 24-year-old trade pact — a move designed to
pressure lawmakers on Capitol Hill to approve its recently
negotiated successor.

Trump, Prime Minister Justin Trudeau and former Mexican
president Enrique Pena Nieto signed the new U.S.-Canada-Mexico
Agreement — USMCA, although the federal government in Ottawa
has rechristened it CUSMA — during an awkward ceremony at the
outset of G20 meetings Friday in Argentina.

Trump was on board Air Force One on his way back to Washington
late Saturday when he announced that he would notify Congress
of his intention to terminate NAFTA, a long-threatened move
that would give lawmakers six months to approve its replacement
once formal notice is delivered.

“I will be formally terminating NAFTA shortly,” the president
said. “Congress will have a choice of the USMCA or pre-NAFTA,
which worked very well. You got out, you negotiate your deals.
It worked very well.”

I will be formally terminating NAFTA shortly

A number of Democrats in Congress, empowered by their new
majority in the House of Representatives, say they don’t like
the new agreement in its current form, warning it will require
more stringent enforcement mechanisms for new labour rules and
protections for the environment in order to win their support.

Massachusetts Democrat Elizabeth Warren, a member of the Senate
Armed Services Committee and one of more than a dozen names
believed to be eyeing a presidential run in 2020, has added her
name to the list of lawmakers who say they won’t support the
new agreement in its current form.

Elizabeth Warren, a Democrat from Massachusetts, speaks at
American University in Washington, D.C., U.S., on Thursday, Nov.
29, 2018.
Andrew Harrer/Bloomberg

“As it’s currently written, Trump’s deal won’t stop the serious
and ongoing harm NAFTA causes for American workers. It won’t
stop outsourcing, it won’t raise wages, and it won’t create
jobs. It’s NAFTA 2.0,” Warren told a luncheon audience last
week during a foreign policy speech in Washington.

She cited a lack of enforcement tools for labour standards,
drug company “handouts” and a lack of sufficiently robust
measures to cut pollution or combat climate change,
particularly in Mexico.

“For these reasons, I oppose NAFTA 2.0, and will vote against
it in the Senate unless President Trump reopens the agreement
and produces a better deal for America’s working families.”

As currently drafted this deal will put Florida seasonal
vegetable growers out of business

Some Republicans see problems, too: Florida Sen. Marco Rubio
tweeted his fears that the current agreement gives agricultural
producers in Mexico an unfair advantage.

“As currently drafted this deal will put Florida seasonal
vegetable growers out of business,” Rubio wrote. “It allows
Mexico to dump government-subsidized produce on the U.S.

“Going forward America will depend on Mexico for our winter
vegetables. Unacceptable.”

Trade experts have long suspected Trump, who has made beating
up on NAFTA a central feature of his political career, might
play the termination card in an effort to light a fire under
the deal’s critics.

In a blog entry posted shortly after the agreement was signed
Friday, Cato Institute trade analyst Simon Lester appeared to
anticipate Trump’s move — although he acknowledged it would
have made a lot more sense if the Republicans still had control
of Congress.

Donald Trump, Canada’s Prime Minister Justin Trudeau, right, and
Mexico’s President Enrique Pena Nieto, left, participate in the
USMCA signing ceremony, Friday, Nov. 30, 2018 in Buenos Aires,
Pablo Martinez Monsivais/AP Photo

“The Democrats are in a different position,” Lester wrote.

“Many of them don’t like NAFTA to begin with, so a withdrawal
threat wouldn’t feel so threatening. Furthermore, a withdrawal
threat could lead to an internal GOP war over trade policy,
which would be wonderful for the Democrats. This all puts the
Democrats in a pretty good spot to make demands.”

Shortly after Friday’s signing, U.S. Trade Representative
Robert Lighthizer insisted that the deal was negotiated with
bipartisan support from both Democrats and Republicans, and
expressed confidence it would survive the congressional
approval process.

“I think we will get the support of a lot of Democrats, a very
high number of Democrats, absolutely — I have no doubt about
it,” Lighthizer said. A number of the their concerns will be
addressed in the implementing legislation that will have to be
brought forward for ratification, he added.

“I’m in discussions with a variety of Democratic leaders on
those points and they will be very much involved in the process
moving forward and will have a strong influence on how we put
things together, because I want them not only to vote for it, I
want them to be happy.”

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