[CTC] Inside the NAFTA ‘war room’: Law firm says deal needs 70-80 more Democrats on board

Tue Aug 6 04:46:26 PDT 2019

Inside U.S. Trade

Inside the USMCA ‘war room’: Law firm says deal needs 70-80 more Democrats on board
By Anshu Siripurapu
08/05/2019

The Trump administration will have to win the support of as many as 80 more Democrats to ensure passage of the U.S.-Mexico-Canada Agreement, Dickinson Wright trade lawyer Dan Ujczo tells Inside U.S. Trade, warning of a “bump and blame” scenario in which a vote on the trade deal gets pushed until after the 2020 presidential election.

Ujczo, whose firm maintains a USMCA “war room,” said the whip count has been holding steady for the past six months -- between 70 and 80 Democratic votes short of passage.

“We think it’s a heavy lift, and it’s really going to depend on will the labor and enforcement two working groups -- will [the] AFL-CIO get on board with that?” he said, referring to the working groups set up by House Speaker Nancy Pelosi (D-CA) to negotiate with U.S. Trade Representative Robert Lighthizer on key areas of concern for Democrats -- labor, environment, enforcement and biologics.

“So I think if we can clear that hurdle, that whip count becomes a lot more close, and then Speaker Pelosi can wrangle the last few votes that she needs,” he said. “That’s kind of what we’re watching for.”

The Senate is not likely to pose a major hurdle, he added, unless the pharmaceutical industry is unhappy with the provisions in the deal. Ujczo said the biologics issue would be the most difficult to address, suggesting it might be dealt with outside of the agreement.

“Biologics could be a problem,” he said. “And I think Speaker Pelosi’s going to have to decide, and I think if you get labor on board, she’ll say, ‘look, … we can do some kind of bargain where we agree with USMCA on labor and enforcement and environment, and we’ll work with the administration throughout the fall and going into 2020 on some kind of affordable prescription drug bill.’ So, there’d be some kind of bargain outside of the USMCA. That’s where I think you may see a deal come together.”

Ujczo said he believed concerns over Mexico’s ability to adequately carry out its labor reforms could be resolved, as could the issue of enforcement using a mechanism akin to a proposal advanced by Democratic Sens. Ron Wyden (OR) and Sherrod Brown (OH). That proposal would boost Mexico’s enforcement personnel and capacity, with U.S. help, and allow countries to deny preferential treatment for goods coming from facilities that are found in violation of USMCA labor standards. The Office of the U.S. Trade Representative is working on an enforcement approach that borrows heavily from the Wyden-Brown proposal, Inside U.S. Trade reported last week.

“I think at that point, it’s going to be tough for AFL-CIO to say that’s not good enough,” he said.

Ujczo said his firm’s war room draws on information from lobbyists in Washington as well as from offices across the country.

“A lot of times, the best intelligence that we’ve been given candidly is when people are talking to legislators back home in the district,” he said. “And then we also have, you know, charts where we’re tracking votes and who wrote a letter for what.”

He suggested some other analyses of USMCA’s changes underestimate the number of votes still needed because they automatically count Democrats in districts won by President Trump as yes votes.

“If you’re a freshman Democrat in a Trump district, you’re not worried about Trump so much, or your Trump voters; what you’re worried about is, you’re going to do whatever the speaker tells you to do,” he said. “That’s what freshmen do; you know what I mean? That’s just the way it works.”

Though a grand bargain between Democrats and the administration could be struck, Ujczo said it was equally likely that both sides will “blame and bump” a vote until after the 2020 election.

“You can kind of see, easily, where each side says -- Trump says, ‘Look, I got you USMCA, Pelosi won’t pass it.’ She can say, ‘It’s not good enough, he can’t close a deal.’ Each of them have a campaign issue, and the money just keeps coming in for 2020,” Ujczo said. “And then you get this done in the lame duck or early in the next presidency. For me, just my instinct, I think that’s the direction we’re headed, because I just -- outside of this budget deal, I have seen no evidence that the White House and Congress can work together to get something done, and with each passing day that becomes less likely.”

The August recess could also throw a wrench into the deal, Ujczo said, as members hear from unhappy constituents back home.

“The other thing that’s undoubtedly going to happen is that these members go home, and they’re at their county fairs, the Italian fest, and the Greek fest, and they’re back home in their district -- they’re going to hear more and more about issues that they don’t like in USMCA,” he said. “Like seasonality has come back up in Georgia and Florida’s delegations on the produce [and] we hear things like country-of-origin labeling and … it could be death by a thousand cuts. But it won’t be death by a thousand cuts, it’ll be delay by a thousand cuts. It could put USMCA into the hospital until after the election.”

Rep. Stephanie Murphy (D-FL), a member of the House Ways & Means committee, said last month that she continued to press the issue of seasonality with Lighthizer and working group members. USTR had initially sought to include provisions in USMCA that would give seasonal growers, who currently lack standing, access to trade remedy proceedings. The proposal was ultimately dropped after Mexico said it was a redline. Murphy and others continue to push for legislative fixes as well.

Challenges aside, Ujczo still maintained that a compromise in the fall was possible, though he remains a skeptic.

“If I had to gamble, I’d say I would join the rest of the Beltway crew and say we’re getting a deal in October,” he added. “It does look like everything’s pointing there, but there’s just something that says to me, I think blame and bump is just as likely and that’s kind of where I am on it. I just don’t know. Unless there’s some [bargain] -- and if it’s a bargain, it’s going to have to be a bargain outside of USCMA, like I said. So, it’ll be maybe prescription drugs, maybe infrastructure, and I just don’t see them doing that. I just don’t see it.”

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.citizenstrade.org/pipermail/ctcfield-citizenstrade.org/attachments/20190806/04d0abc3/attachment.html>