USMCA Trade Deal May Hit Snag

USMCA Trade Deal May Hit Snag

The US-Mexico-Canada Agreement (USMCA) has had a long and winding road as it has worked its way through Congress. In 2018, President Trump was able to negotiate a new deal with Canada and Mexico after calling the North American Free Trade Agreement (NAFTA) the “worst” trade deal in American history.

Almost immediately after the Democratic House’s impeachment in December, the House passed the USMCA on a bipartisan vote right before Christmas. Democrats and labor unions spent a year addressing their concerns before obtaining concessions from Trump. Democrats say the agreement improves the enforcement of labor standards and deters companies from moving jobs to Mexico.

In addition, the USMCA helps American farmers by increasing access to Canadian dairy markets and updates the rules of digital trade.

Senate Rules Create a Delay to Passage

Though the Republican-led Senate hopes to get a full vote this week on the USMCA, that may be hard, if not impossible, to do. The deal’s various provisions require different Senate committees to review and approve the deal before it heads to the floor for a final vote.

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On Tuesday, the Senate Finance Committee voted 25-3 to approve the USMCA. A procedural rule in the Senate will require the approval of six other committees that have specific jurisdiction over key aspects of the agreement.

Those committees are:

  • Health, Education, Labor, and Pensions
  • Environment and Public Works
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  • Foreign Relations
  • Appropriations
  • Commerce, Science, and Transportation
  • Budget
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It could take several weeks for all the committees to complete their approvals, even though they cannot change any of the content. The committees have yet to announce when they will schedule a hearing to review the USMCA.

Impeachment Could Also Delay USMCA

In addition to committee schedules, the agreement could also be delayed if the House forwards the Articles of Impeachment to the Senate. However, House Speaker Nancy Pelosi (D-CA) has withheld the articles in an attempt to force the Senate to bend to the House Democrats’ will to hold what they would consider a “fair” trial.

Senate Majority Leader Mitch McConnell (R-KY) has stated the House will not pressure the Senate into falling in line with its agenda.

Senate Finance Chairman Chuck Grassley (R-IA) said he believes the impeachment is “going to be a problem.” He further stated:

“but the real problem is the extent that we don’t know when we are going to get the Articles of Impeachment. When those articles enter into the Senate chamber that has priority over everything else. If I wanted to speculate, and if they don’t come over for another week or 10 days, we can get this (USMCA) done. If the articles of impeachment come over it could be two, three, four weeks before we can get this done.”

When the USMCA is approved, Trump will gain a big win on trade policy leading up to the election as well as remove uncertainty in the economy.

If Congress does not approve the USMCA, Trump has said the United States will pull out of NAFTA.

By Don Purdum, Freelance Contributor

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