Dec 16, 2019

Mexicans throw 11th hour curveball at Trump's biggest trade deal

Nancy Pelosi and Ways and Means Committee Chairman Richard Neal during a news conference on the USMCA trade agreement, Dec.10. Photo: Mark Wilson/Getty Images

Democrats have a "tentative plan" to vote Thursday on the trade deal President Trump negotiated with Mexico and Canada to replace NAFTA, per a senior House Democratic aide, but Mexican officials are complicating those plans.

Driving the news: "Mexico's top trade negotiator plans to return to Washington ... to express his outrage over language in the U.S. bill to implement the new North American trade agreement," Politico's Sabrina Rodriguez reports.

  • "Mexico was blindsided by the inclusion of language in the implementing bill that would allow the Trump administration to deploy full-time diplomats to Mexico to make sure the country is upholding labor standards, Jesús Seade, Mexico's undersecretary for North America, said Saturday."

The big picture: Mexico has already ratified these changes to the deal. The nightmare scenario for Trump and Democratic leadership is that domestic pressures force the Mexican government to take drastic action, like saying they'll block U.S. inspectors from Mexican factories. That would severely complicate a deal that was set to easily pass Congress.

Between the lines: The U.S.-Mexico-Canada Agreement (USMCA) will probably still fly through the House at the end of this week. Trump has crafted a deal that no traditional Republican would have supported in the pre-Trump era, and Nancy Pelosi is keenly aware of that. She has jettisoned the promised process to ram the deal through before the end of the year.

  • It's also good politics for Pelosi to sandwich a Wednesday impeachment vote in between two governing votes: a Tuesday vote to fund the government and a Thursday vote to pass the USMCA.

The bottom line: Democrats who've worked on trade deals for decades say they doubt that any other Republican president in the foreseeable future would support a deal like the USMCA. The USMCA is a deal tailor-made for organized labor and protectionist Democrats. That Republicans are willing to vote for it is a testament to the awesome power Trump wields over his party.

  • Pelosi reportedly told her caucus that Democrats "ate their [Republicans'] lunch" on USMCA.
  • But the ensuing debate over whether she did in fact eat their lunch misses the point. Trump didn't care about traditional GOP trade priorities and he made Republicans irrelevant to the negotiations.
  • Trump correctly identified that Republicans would step in line, no matter what he decided. And leaving aside Pat Toomey, the lonely voice of free trade in the Republican Senate, Trump read his party right.

Go deeper: Business groups express growing dissatisfaction with USMCA compromise

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House passes USMCA free trade deal

Photo: Mark Wilson/Getty Images

The House voted 385-41 Thursday to pass a revised version of the U.S.-Mexico-Canada Agreement (USMCA), a trade pact President Trump negotiated to replace the North American Free Trade Agreement.

Why it matters: Completing the trade deal has been one of President Trump's biggest policy goals in 2019. House Democrats' decision to back it earlier this month highlights how they want something concrete to bring home to their constituents ahead of the new year as well, even after voting to impeach the president on Wednesday night.

Go deeperArrowDec 19, 2019

Robert Lighthizer tells Mexico: USMCA "attachés" are not "labor inspectors"

U.S. Trade Representative Robert Lighthizer. Photo: Rodrigo Arangua/AFP via Getty Images

U.S. Trade Representative Robert Lighthizer said in a letter to a top Mexican trade negotiator Monday that the full-time diplomats, or attachés, designated to uphold labor standards in the version of the United States-Mexico-Canada Agreement (USMCA) sent to Congress are not "labor inspectors."

Why it matters: Mexico’s Undersecretary for North America Jesús Seade flew to Washington on Sunday to confront U.S. officials over the inclusion of language that would appoint attachés to implement labor reform in Mexico, accusing the Trump administration of blindsiding them. The intervention has thrown a wrench in the House's tentative plan to vote on the North American trade deal on Thursday.

Go deeperArrowDec 16, 2019

Sanders blasts USMCA free trade deal for not mentioning climate change

Sen. Bernie Sanders said at the Democratic debate on Thursday night that the USMCA free trade deal that President Trump negotiated is a "modest improvement" over NAFTA, but that he will not vote for it because it will not stop outsourcing to Mexico and does not mention climate change.

Why it matters: The House overwhelmingly passed the USMCA on Thursday after Democrats secured certain labor provisions. Passing the deal is one of Trump's top policy goals of 2019 and is tailor-made for protectionist Democrats, but Sanders — who has long opposed free trade agreements — still plans to vote against it when it reaches the Senate.

Keep ReadingArrowDec 20, 2019