[CTC] Democrats Reject Trump Nafta Deal Without Canada

[Arthur Stamoulis]

Couple articles below…


https://www.wsj.com/articles/democrats-reject-trump-nafta-deal-without-canada-1538072201 <https://www.wsj.com/articles/democrats-reject-trump-nafta-deal-without-canada-1538072201>

Democrats Reject Trump Nafta Deal Without Canada

By: William Mauldin 
9/27/2018

WASHINGTON—The Trump administration’s move to proceed with a new North American Free Trade Agreement without Canada <https://www.wsj.com/articles/trump-administration-plans-to-make-public-mexico-only-nafta-draft-on-friday-1537994392?mod=article_inline> is running into resistance from a group that officials had hoped would provide significant support for the revised pact: congressional Democrats.

Some traditional Democratic constituents, including unions and other labor interests, have supported efforts to address labor issues in the Nafta revision. 

But several Democratic lawmakers briefed by U.S. Trade Representative Robert Lighthizer on Thursday instead expressed discontent with Trump administration plans to advance a Nafta deal in the days ahead that drops Canada and moves forward with just Mexico <https://www.wsj.com/articles/mexico-u-s-nafta-negotiators-signal-confidence-after-marathon-sunday-session-1535372909?mod=article_inline&mod=article_inline>.

Mr. Lighthizer has signaled that Canada could rejoin the agreement later, an idea that supporters of the Trump administration’s trade policy have embraced. 

Still, members of the House Ways and Means Committee, which oversees trade, expressed disappointment that the administration was bringing them a bilateral deal with Mexico—at least for now—rather than the trilateral deal it told Congress it would begin negotiating a year ago.

“This is an abject failure,” said Rep. Brian Higgins, a Democrat whose upstate New York district borders Canada. “I don’t think there’s going to be any Democratic votes for this.”

Rep. Lloyd Doggett, a Texas Democrat, said Mexico is much more important to him but added: “I do believe that we need Canada in,” in part due to supply chains that span the continent.

Mr. Lighthizer was spending Thursday on Capitol Hill updating lawmakers on Nafta and the administration’s broad trade strategy. He was expected to update the members of Congress about plans to move forward with trade negotiations with the European Union, Japan and others.

Republicans also expressed some concerns about the latest direction on Nafta and said they hoped Canada would remain at the negotiating table and join the U.S.-Mexico deal soon.

“I think it is in their interest” to stay in Nafta, said Rep. Kevin Brady, the Texas Republican who chairs the House committee. He said that it is premature to say how Congress would react if it has to consider a U.S.-Mexico deal without Canada.

Canadian Prime Minister Justin Trudeau on Thursday reiterated his view that a “good, fair deal” on a revised Nafta is still possible <https://www.wsj.com/articles/trudeau-presses-for-right-deal-for-canada-on-trade-1537981197?mod=article_inline>. He said the Trump administration was frustrated because “Canadians are tough negotiators, as we should be.”

The initial resistance from lawmakers is a setback for the administration because many Democrats are, like President Trump, skeptical of the benefits of unfettered trade. Many embrace the Trump administration’s efforts to toughen trade regulations and raise labor standards in Mexico to prevent manufacturers from moving jobs and production abroad.

Lawmakers often react negatively to details of new trade agreements, and building congressional support usually takes at least months and sometimes involves concessions and side deals. Most trade agreements pass by narrow margins.

Mr. Lighthizer has said he had hoped his version of Nafta would gain support from a broad bipartisan majority of lawmakers. The deal would in any case require majority votes in the House and Senate to be enacted.

Democrats who have supported Mr. Trump’s approach also expressed reservations about the details of the pact with Mexico, including the enforceability of labor provisions designed to raise standards there.

“There remains major work to be done,” said Rep. Sandy Levin, a Michigan Democrat who wants Mexico to enact labor provisions.

Some labor groups frequently aligned with House Democrats have worried publicly about the enforceability of the provisions Mr. Lighthizer has negotiated with Mexico, leaving room for them to oppose Mr. Trump’s Nafta deal even though they supported the direction of the negotiations.

Not all criticism was directed at the Trump administration. U.S. lawmakers—notably senior Republicans—have expressed impatience with Canadian officials for not reaching a deal <https://www.wsj.com/articles/u-s-canada-face-tough-issues-as-they-resume-nafta-talks-1536097035?mod=article_inline&mod=article_inline> with Mr. Lighthizer, echoing the frustration Mr. Trump expressed <https://www.wsj.com/articles/trump-administration-plans-to-make-public-mexico-only-nafta-draft-on-friday-1537994392?mod=article_inline> Wednesday.

Democrats, who have a chance of controlling the House next year during a Nafta vote, signaled they weren’t ready to accept a two-country deal yet.
“We were never given notice that this would become a bilateral,” said Rep. Suzan DelBene, a Washington Democrat whose district borders Canada.

—Paul Vieira in Ottawa contributed to this article.



INSIDE US TRADE
 
Daily News
Ways & Means Democrats: NAFTA vote likely won’t happen until February
September 27, 2018 at 2:47 PM
 
Following a meeting with U.S. Trade Representative Robert Lighthizer, several Democrats on the House Ways & Means Committee said the earliest Congress was likely to vote on a NAFTA-like deal is February or March.
 
Rep. Lloyd Doggett (D-TX) told reporters on Thursday that Lighthizer, “in response to my question,” said that “probably the soonest that we could vote on this agreement, even if it’s just a bilateral with Mexico, is next February or March.”
 
Lawmakers also expressed frustration over what they described as vague or incomplete answers from Lighthizer about how the administration planned to move forward if Canada does not join before text of the U.S.-Mexico deal is released. That text is expected on Friday. Some also said it remained unclear what would happen if Canada wanted to join the deal later -- if, for example, the Trade Promotion Authority “clock” would restart.
 
Doggett said Lighthizer cited an analysis that must be conducted by the U.S. International Trade Commission in offering up a possible time line for a vote on implementing legislation. Under TPA law, the ITC’s report is due 105 days after a trade agreement is signed, though it can be submitted earlier. The U.S. and Mexico are hoping to sign the deal before Dec. 1.
 
“Given the ITC review and everything [February or March is] probably the earliest that we would be able to consider it, and that seems reasonable,” Doggett said. “I had some concern that there might be some last-minute effort to push something through, cutting deadlines and the like, but that’s I think a responsible and realistic position.”
 
Several lawmakers said the overall message conveyed by USTR during the meeting was that Canada should be a part of the deal, but that more progress had to be made before that could happen.
 
Asked if he would support a U.S.-Mexico bilateral deal, Doggett said the implementing legislation would provide more clarity on many remaining questions.
 
“We’ve had so many problems with implementation before, and [Lighthizer] indicated he would put out a summary near the time of announcing any agreement on what that implementing legislation will look like,” Doggett said, adding he could not say for sure whether a U.S.-Mexico deal was something he could support until the details of the implementing legislation were released.
 
“I think it was a constructive discussion. He laid out reasons why we don’t have Canada there yet, and his objective is still to get a tripartite, true NAFTA, but that there’s some major obstacles and that he didn’t feel that Canada’s been negotiating in good faith,” Doggett said.
 
Almost all committee members, he continued, “don’t believe you can have a new NAFTA without all three parties, but he made a strong case for the need for Canada to make more concessions -- to make some concessions -- in order to get there.”
 
But Rep. Brian Higgins (D-NY) said the way the administration has been “trumpeting this deal with Mexico” and excluding Canada is “unacceptable.”
 
Asked if the deal’s text would include Canada, Higgins said Lighthizer was not “clear” in his answer, though he “indicated there was no deal with Canada but the hope is that Canada will come in later on.”
 
Ron Kind (D-WI) said that he told Lighthizer he thought the USTR viewed the 2015 Trade Promotion Authority law as “more of a set of suggestions or guidelines rather than a requirement to work closely with Congress.”
“[Lighthizer] acknowledged that they need to be doing more outreach, and hopefully they will,” Kind said.
 
As for the “clock” under TPA law, and whether it would restart if Canada does join the deal, Kind said “It’s not clear. It’s been frustrating. Obviously, many of us are pushing for a trilateral to come back, but we also want a good deal. And I made the point too that a lot of what’s happening in the negotiations with Canada was a self-inflicted wound. When you unilaterally impose tariffs against some of our closest friends and allies, and declare them a national security threat to the United States, I wouldn’t expect them to come to the table in good faith negotiations and cede to all our demands.”
 
The U.S., Kind continued, “created a terrible political domestic environment” for Canadian representatives to contend with.
 
“The last thing they need to do is to go back to their constituents and it appears that they’re succumbing to a bully across the border. This is something the administration has created in this negotiation,” Kind asserted.
He added that Lighthizer did not definitively say there was a path forward on Section 232 tariffs.
 
The lawmaker said he also asked the USTR “about Mexico, whether there are any chapters or provisions that are not completed yet, and I didn’t get a good response from him on that.”
 
“So, I’ve got to follow up with him,” he added. “There was no response to that question. So, I want to follow up. I’m hearing that this thing is not completely put to bed. There are some remaining issues that need to be resolved.”
Rep. Bill Pascrell (D-NJ), ranking member of the trade subcommittee, said the USTR made clear “they are trying to do the best they can in terms of getting to a Mexico agreement,” but added that this week was simply one step in a multi-tiered process.
“So, we are really at the end of stage one. Stage two we are getting into specifics. Stage three is when congress approves and the president signs. This thing is now moving into February of next year,” Pascrell contended. “I don’t see a vote coming before then.”
 
“The question is the first period ends Sunday -- Canada is not part of that. We will have some kind of text with Mexico but when we go into the next phase when we are trying to figure out language of enforcement -- things like that -- we will continue to try to be negotiating with Canada and my feeling is that we can do this legally under the present law if we bring Canada into this thing later, which we should have as a major objective,” he said.
 
“Nobody on either side wants us to capitulate to Canada,” Pascrell continued, though he also warned against “insulting Canada.”
 
On Wednesday, President Trump said he rejected a one-on-one meeting <https://insidetrade.com/node/164505> with Canadian Prime Minister Justin Trudeau because Canada was dragging its feet in trade talks with the U.S. A spokeswoman for Trudeau, however, said no such meeting was ever requested.
 
Pascrell said that he thought Lighthizer was “doing the best that he possibly can” and said he lamented other distractions. “I wish he was the engineer driving the train rather than simply doing all of the hard work, then having someone on sidelines yelling from the mezzanine,” Pascrell said.
 
Rep. Judy Chu (D-CA) said she understood USTR’s “dilemma” with Canada because Ottawa has taken a hard line in some key areas, such as a cultural carveout aimed at protecting its creative industries.
 
“I raised the issue of the cultural carveouts, which is very one-sided and hurts our U.S. creative industries such as television and movies, which is important to me representing Los Angeles,” she told Inside U.S. Trade. Asked if she felt that progress could be made in the coming months on the issue, Chu responded: “Well, actually, what I got the sense was that the ambassador was very frustrated with his dealings on these issues and on the issues of dairy and so forth. I’m not sure if there can be progress in the short run.”
 
Asked whether she would support a U.S.-Mexico deal, she said “it remains to be seen. Chu added that the “principle” behind NAFTA was trilateral. “So, the principle is important,” she said.
 
Lighthizer, she continued, “made the point repeatedly that he has been in negotiations with Canada for 14 months and they've not made much progress on five main issues including dairy and cultural carveouts.”
 
Rep. Suzan DelBene (D-WA) reiterated concerns <https://insidetrade.com/node/164342> that USTR’s notice to Congress last year was for a trilateral -- not bilateral -- deal.
 
“We were never given notice that this would become a bilateral,” she said.
 
Asked if she got the sense from Lighthizer that Canada and the U.S. were working toward a solution, DelBene said “I think if he had a solution with Canada as well then he would have had talked to us about that today.” -- Isabelle Hoagland (ihoagland at iwpnews.com <mailto:ihoagland at iwpnews.com>)
 
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