Sep 30, 2018

Don't hold your breath on NAFTA

Illustration: Rebecca Zisser/Axios

Today is NAFTA deadline day, and it's down to the wire. It's the date that a deal supposedly has to be done, with or without Canada. Something's getting sent to Congress, and it's either going to be a bilateral deal with Mexico or it's going to be a full-fledged renegotiated pact including Canada.

"I love deadlines. I love the whooshing noise they make as they go by."
— Douglas Adams, "The Salmon of Doubt"

The details: A deal is reportedly very close, but there's no indication that President Trump has any desire whatsoever to sign a deal with Canada. On the other hand, there's also no indication that there's any appetite in Congress for a bilateral deal with Mexico.

  • If a US-Mexico deal gets sent to Congress today, that's not the end of the line.
  • The deadline just allows the deal to be signed by outgoing Mexican President Enrique Pena Nieto, rather than by his populist successor, Andres Manuel Lopez Obrador.
  • But US-Canada negotiations will continue, in the hope that the final differences between the two sides can be bridged.
  • Worth noting: The lead Canadian negotiator, Minister of Foreign Affairs Chrystia Freeland, is expected to give up her speaking slot at the UN on Monday, where she's angling for a seat on the Security Council, due to (presumptively still ongoing) NAFTA talks.

The big question: What happens if a deal with Canada can't be done? Trump wants to cripple the Canadians and kick them out of NAFTA, but he doesn't have fast-track authority to take an action that drastic.

  • He'd need Congress, in other words, including representatives from northern states with deep, long-standing trade ties to Canada.

Answers on a postcard please: What's stronger, the supply chains connecting the U.S. and Canada or the apron strings connecting congressional Republicans to Trump?

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