[CTC] Brady: ‘Skinny’ NAFTA deal would be a lost opportunity

[Arthur Stamoulis]

INSIDE US TRADE
Brady: ‘Skinny’ NAFTA deal would be a lost opportunity

May 21, 2018 
House Ways & Means Chairman Kevin Brady (R-TX) on Monday said he would not support a pared-down renegotiation of the North American Free Trade Agreement, breaking with Sen. John Barrasso (R-WY) who endorsed such an approach earlier that day.

“I think, frankly, we’re too close to a comprehensive modern NAFTA that addresses a broad range of challenges and opportunities in energy, telecom, digital trade and agriculture that ought to be part of a modern agreement,” he told reporters on Monday. “I don’t want to miss this opportunity by aiming too low.”

Barrasso, the chairman of the Republican Policy Committee, told CNBC that he would prefer a renegotiated NAFTA not have to go through Congress <https://insidetrade.com/node/163107>. U.S. Trade Representative Robert Lighthizer last week told the House New Democratic Coalition that he was not interested <https://insidetrade.com/node/163052> in a pared-down NAFTA.

Talk of a “skinny” NAFTA that has picked up as the administration faces the prospect of not being able to close the negotiations in time for the current Congress to consider a deal. House Speaker Paul Ryan (R-WI) had initially set a May 17 deadline for the administration to submit its notice of intent to sign a deal, but has since backed off that date <https://insidetrade.com/node/163056> by noting that the 2015 Trade Promotion Authority has some flexibility in its time lines.

Brady downplayed any deadlines by saying that the best-case scenario would be a deal the current Congress could consider, but that the second-best scenario was closing the negotiations this year and allowing the next session of Congress to vote on the pact.

“I think it’s important they stay at the table,” Brady said. “Look, the best scenario is a pro-growth modern NAFTA that can pass [Congress] this year. But the next-best scenario is a modern pro-growth NAFTA that all three parties agree to this year that we can begin the process of the TPA going forward. I think while there are substantive issues left, they’ve made significant progress. And I think all three parties are capable of closing this out.”

In a floor speech on Monday, Senate Finance Committee Chairman Orrin Hatch (R-UT) also dismissed a deadline for finishing the NAFTA talks.

“While speculation about time lines is natural, let me be clear, as I have said from the beginning of these talks, the most important thing for determining when and how Congress will vote on an eventual NAFTA outcome is the quality of the agreement,” Hatch said. “I understand that the current negotiations are about an existing agreement that American businesses and workers rely on in dealing with two of our largest trading partners. And I understand that continuing negotiations means a level of uncertainty about these important relationships will persist. Nevertheless, it is critical that the administration takes the time necessary to get these negotiations right. I believe the administration understands that.”

Brady twice told reporters on Monday that he is urging the administration to “stay at the table” with Canada and Mexico.

“I continue to urge the administration to stay at the table with Canada and Mexico in a modern ad pro-growth NAFTA,” he said. “I think it would be a significant win for the U.S. economy and together with Canada and Mexico as our trading partners we can compete and win. Our local businesses and workers can compete and win against China, Europe and the rest of the world as well. So, we’re urging them to stay at the table.”

In a similar vein, 32 Republican senators on Monday wrote a letter to Lighthizer <https://www.cornyn.senate.gov/node/4659> urging him not to withdraw from NAFTA as a means to force Congress to decide between a renegotiated NAFTA or no deal at all.

“We are concerned about recent media reports suggesting that you may be considering an ultimatum strategy to pressure Congress into accepting an updated NAFTA, including through threats to withdraw from the original agreement,” the letter said. “In the past, you have suggested that your goal is to achieve overwhelming bipartisan support for a modernized NAFTA. We believe this goal is only achievable through a strategy to constructively engage Members of Congress as required by TPA and without attempting to force a choice between negative outcomes. In our view, a take-it or leave-it strategy could have negative unintended effects that jeopardize American jobs and economic growth. When discussing NAFTA modernization legislation with Congress, we ask the Administration employ a strategy that emphasizes collaboration, rather than conflict.”

Senate Majority Whip John Cornyn (R-TX) spearheaded the letter. Inside U.S. Trade on Friday reported that Cornyn and several of his Republican colleagues would send the letter <https://insidetrade.com/node/163096> to Lighthizer.

The letter was also signed by Sens. Johnny Isakson (R-GA), Pat Roberts (R-KS), James Lankford (R-OK), Lamar Alexander (R-TN), Joni Ernst (R-IA), John Boozman (R-AR), Pat Toomey (R-PA), John Barrasso (R-WY), Deb Fischer (R-NE), Mike Rounds (R-SD), Ben Sasse (R-NE), Jerry Moran (R-KS), Lindsey Graham (R-SC), Todd Young (R-IN), Thom Tillis (R-NC), Ron Johnson (R-WI), John Thune (R-SD), Mike Enzi (R-WY), Chuck Grassley (R-IA), Roger Wicker (R-MS), Tim Scott (R-SC), John Hoeven (R-ND), Steve Daines (R-MT), Mike Crapo (R-ID), Bob Corker (R-TN), John McCain (R-AZ), Ted Cruz (R-TX), Jim Risch (R-ID), Mike Lee (R-UT), Bill Cassidy (R-LA) and Cory Gardner (R-CO).

Ten of the 14 Republicans on the Senate Finance Committee signed the letter: Cornyn, Isakson, Roberts, Toomey, Thune, Enzi, Grassley, Scott, Crapo and Cassidy. -- Brett Fortnam (bfortnam at iwpnews.com <mailto:bfortnam at iwpnews.com>)


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