[CTC] Senators: Trump called NAFTA withdrawal threat a ‘negotiating tactic,’ urged them to ‘trust’ him

[Arthur Stamoulis]

INSIDE US TRADE
 
Senators: Trump called NAFTA withdrawal threat a ‘negotiating tactic,’ urged them to ‘trust’ him

October 25, 2017 
President Trump told Republican senators in private on Tuesday he believes the U.S. must trigger a withdrawal from NAFTA to move Canada and Mexico to negotiate more seriously, adding that they should “trust” him to get a better deal, multiple senators told Inside U.S. Trade.

“The president said there was no way to get the changes we need unless we get out, then have six months to negotiate,” said one GOP senator who strongly backs NAFTA.

The senator said Trump, during a luncheon with GOP senators, didn't specify what he believed the administration would be able to win in terms of concessions from Mexico and Canada, adding, “I don't think they know.”

The only specific goal the president mentioned, the senator said, was reducing the trade deficit with Mexico. “He's obsessed with the trade deficit,” the senator said.

Sen. Pat Roberts (R-KS), a Finance Committee member who also chairs the Agriculture Committee, engaged in a discussion with the president about how initiating the withdrawal process would impact the U.S. agriculture community, senators said.

Roberts told Inside U.S. Trade Trump urged the Republican caucus not to get “too excited” about how his administration was “handling the NAFTA matter” -- to which Roberts said he responded, “I am excited.”

“Basically I’m trying to point out that if you start the clock on NAFTA [withdrawal] that’s going to send very bad signals throughout the entire farm economy,” Roberts said.

“That may be an option that the president feels he should exercise in order to get Mexico to the table to achieve what he wants to achieve, which is the trade imbalance -- I understand that -- but I think we can do it in different ways without sending shock waves all throughout agriculture,” he added.

“And then to restitch that and put it all back together it’s like Humpty Dumpty. You push Mr. Humpty Dumpty trade off the wall and it’s very hard to put him back together,” Roberts continued.

Another senator said “the president described it as a tactic to move things along that could result in withdrawal but may be designed to just result in negotiating.”

The senator added that he would not be surprised if Trump actually pulled out of the agreement, adding that in his view, “they’re way off on their trade policy.”

Trump, in response to the concerns voiced by the senators, said “trust me, we’re working on this,” multiple senators said.

One senator said the president “emphasized he knows the importance of trade but he just needs a better deal,” adding that there was “some concern out there that he may not fully appreciate how important NAFTA is to some states.”

“And he goes: ‘Yes, I fully appreciate that,’” the senator said of Trump’s response. “He said ‘I understand your concerns, trust me.’”

Asked whether he trusted the president, the senator said: “I think the president wants economic growth, absolutely. Now, reasonable people can have different opinions as to what is the best recipe for economic growth but I do totally trust that he wants economic growth.”

Roberts told Inside U.S. Trade Trump responded to his complaints by saying “stay with me, stay with me, we’re going to get a better deal, stay with me.”

“And I said ‘all right, Mr. President, I’m going to stay with you, but I just got to tell you that you said not to get excited but everybody in farm country is already excited,’” Roberts added.

Roberts said he received a similar response from U.S. Trade Representative Robert Lighthizer when the two discussed withdrawal in a recent phone call. The Kansas senator said he also discussed the administration’s NAFTA “sunset” proposal -- and the precedent that such a provision would set for future agreements -- with Lighthizer, who he said indicated to him that he wanted “all trade agreements to expire at the end of five years.”

Lighthizer, Roberts said, responded by saying “well, countries will really buy on that fifth year thinking that it might not be extended.”

“And I said to Lighthizer that what we need is people to buy now,” he said, noting that Mexico recently began buying wheat from Brazil.

“I hope they can work it out -- this idea of trying to fix the trade imbalance -- but I think you can do it on a cooperative basis as opposed to the art of the deal,” Roberts said. He said he liked Lighthizer, who he called “a good man,” but, he added, “he’s working at the direction of the president ... so there it is. We just have a difference of opinion as to how to go about things without sending shivers throughout all the farm economy right now.”

Roberts also mentioned the automotive industry, which has expressed increasing anxiety with the administration’s approach to the NAFTA talks.

A former Senate leadership staffer who was involved in passing multiple trade agreements argued that “the president has a pretty shallow reservoir of trust to draw from generally and virtually none on the topic of trade. There's simply no evidence he understands the stakes involved or the nature of the economic relationships we have with our neighbors.”

“Members of Congress uniquely understand how trade benefits businesses and workers in their districts and the president would be wise to listen to their counsel,” the former staffer added.

Another senator expressed concern that Mexico and Canada would “move on” to trade deals with other countries, adding, “We're not in as strong a position as [Trump] thinks we are.”

That feeling was echoed by Roberts, who said “everybody’s arrangements that they have right now with both Canada and Mexico are up in the air, so people start to make other plans.”

Senate Foreign Relations Committee Chairman Bob Corker (R-TN), who has sparred fiercely and publicly with Trump in recent days, called the recently announced decision to extend NAFTA negotiations into next year “a good sign,” but added, “Who knows?” when asked whether the president intends to withdraw from the deal at least as a negotiating ploy. “It depends on which day he wakes up, right?” Corker quipped.

Shortly before the Tuesday luncheon on Capitol Hill Trump talked about NAFTA at the Oval Office, where he claimed the administration was “way ahead of schedule <https://insidetrade.com/node/160745>” in enacting his trade agenda. Trump, reiterating previous comments, said the U.S. may have to pursue “a new NAFTA or a new deal. But we'll see how it turns out.” -- Jenny Leonard (jleonard at iwpnews.com <mailto:jleonard at iwpnews.com>) with Charlie Mitchell (cmitchell at iwpnews.com <mailto:cmitchell at iwpnews.com>)
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