[CTC] White House focused on state, local efforts to push Congress on NAFTA

[Arthur Stamoulis]

White House focused on state, local efforts to push Congress on USMCA
August 09, 2019, Inside US Trade

The White House is focusing its efforts to convince Congress to ratify the U.S.-Mexico-Canada Agreement on state and local campaigns, hoping to gin up grassroots support among voters who will pressure lawmakers to support President Trump's signature trade pact, according to a senior administration official and a USMCA coalition representative.

The administration is expected to soon step up its push for USMCA passage as Congress' August recess draws to a close and the window for the White House to submit the USMCA implementing this fall remains open. The senior administration official said cabinet secretaries will soon be out campaigning for USMCA support. The traveling secretaries will be the newest feature of the White House's outreach effort, which has included extensive engagement with industry, local leaders and elected officials.

Trump and Vice President Mike Pence already have forged a kind of USMCA campaign trail. Pence has made a series of speeches extolling USMCA in Pennsylvania, Iowa, Michigan and a host of other locales -- more than 15 trips in all, the official said. The president, meanwhile, has touted the deal during recent rallies in Florida, North Carolina, Pennsylvania, Wisconsin and Michigan.

The White House's intergovernmental affairs team is working to secure statements of support from local elected officials, receiving more than 2,000 such to date, the administration official said.

Industry coalitions, meanwhile, continue to play a critical role in the push for USMCA ratification. The groups are reaching out to constituents about the benefits of the trade pact and urging them to contact their representatives and demand a vote on the deal. Agriculture, auto, manufacturing and pharmaceutical industry groups are all involved, one coalition representative said. Those groups' members are also speaking directly with members of Congress.

The U.S. Chamber of Commerce, the National Association of Manufacturers and the Pass USMCA Coalition are all working closely with USTR to get the right information to constituents, the coalition representative added.

Specifically, the Pass USMCA Coalition has been tracking meetings held by elected officials to make sure constituents have the opportunity to voice their opinions on USMCA, said former Rep. Erik Paulsen (R-MN), an honorary co-chairman of the group.

"Members want to hear from constituents that this is supported," he said in an interview with Inside U.S. Trade.

Chamber President Tom Donohue last month said his group would be “activating our grassroots network and talking to key districts and states to get lawmakers to 'yes' sooner rather than later.”

"We are going to ramp things up in a major way over the August recess. It's much more effective to catch these guys and gals at home," Donohue said.

The administration is targeting Democrat-held congressional districts where Trump won in 2016, according to a Washington, DC-based USMCA coalition representative. "The real power coalition in the House is the New Dems and the 'Trump Dems," the representative said.

Democrats in Trump districts need a legislative victory to cite when campaigning, and passing USMCA would give them that, the coalition representative said, claiming the caucus does not have many other achievements to tout. USMCA "gives them something to run on rather than run against something," the representative said.

But whether Democratic leaders are willing to give Trump and the Republicans that perceived victory remains an open question. Former Rep. Charles Boustany (R-LA), in an interview with Inside U.S. Trade, said he was skeptical that House Speaker Nancy Pelosi (D-CA) would want to give Trump a win -- and the closer a USMCA vote gets to the 2020 election, the more perilous its chances become.

"From a political standpoint, I don't understand why the Democrats would give him a victory on a signature issue," he said.

Lighthizer works the Hill
U.S. Trade Representative Robert Lighthizer has fostered a strong working relationship with Pelosi as well as Senate Finance Committee ranking member Ron Wyden (D-OR), several sources said, giving congressional Democrats confidence that the USTR is receptive to concerns being voiced by the caucus.

Boustany said Democrats probably have more confidence in Lighthizer than any other recent USTR. Paulsen said the amount of personal time and effort Lighthizer has put in on Capitol Hill has spurred that confidence on both sides of the aisle.

But Lighthizer and Agriculture Secretary Sonny Perdue are the only cabinet members visibly working the halls of the Capitol to get support for USMCA, according to Boustany and industry sources. Other administration officials are "persona non grata," Boustany said, singling out Cabinet secretaries including Commerce Secretary Wilbur Ross, who the House recently held in contempt of Congress over census questions.

According to Boustany, the acrimonious relationship between some Cabinet secretaries and Congress limits the administration's ability to whip up USMCA support, whereas during the Obama administration's push to get the Trans-Pacific Partnership ratified it was common for lawmakers to receive phone calls from several secretaries each day. Lighthizer also cannot put his sole focus on USMCA, as his plate is full, Boustany said, noting in particular ongoing high-stakes negotiations with China.

The White House legislative team is working in lockstep with USTR, the senior administration official said, with Office of Legislative Affairs personnel meeting regularly with Congress.

Lighthizer has been working to address House Democrats' concerns with biologics, labor, environment and enforcement provisions in USMCA, dealing with a working group set up by Pelosi. The two sides are continuing to talk during the August recess, exchanging ideas and "paper" but USTR has yet to respond to Democrats' proposals with detailed counterproposals, congressional aides said.

A grand bargain?
Looming over those negotiations is the possibility that USMCA could be tied to another legislative effort, one that would give Democrats a clear victory in exchange.
"Everybody thinks there is an X-factor she will want in return for moving on USMCA," the coalition representative said.

An industry source suggested USMCA could end up being linked to healthcare, immigration or infrastructure legislation. A "grand bargain" involving USMCA and another congressional priority is becoming increasingly likely if the trade deal is going to be moved on this fall, the source said.

The administration and Democrats could try to strike a deal that addresses lawmakers' concerns on biologics through drug pricing legislation, sources said. USMCA requires the parties to ensure 10 years of exclusivity for biologics. Many Democrats have claimed that the deal could result in higher drug prices, a notion the administration and congressional Republicans contest. The U.S. exclusivity period for biologics is 12 years, and USMCA would not require a change in U.S. law, they say. It would, however, require that Canada and Mexico increase their biologic exclusivity periods, which stand at eight and five years, respectively.

The coalition representative suggested that it could make more sense to tie USMCA to an infrastructure package because such legislation would include funding for projects in congressional districts that lawmakers could point to as victories. Infrastructure could be a more palatable legislative companion than drug pricing because the latter would require extensive negotiations between House Democrats and Senate Republicans, which may not be required with an infrastructure deal.

Paulsen said he did not think USMCA ultimately would be linked to other legislative priorities, saying there was support for the deal if it is kept away from other political issues.

Rep. Henry Cuellar (D-TX), one of the House working group leaders and an ardent USMCA supporter, recently left open the possibility that Pelosi could decide to move forward on USMCA without a majority of her caucus -- scrapping the informal "Hastert rule" that says legislation can move in the House only if most of the majority party supports it. But getting Democrats, especially those on the House Ways & Means Committee, on board will be crucial as the legislative process plays out, Boustany said.

Trade agreements typically go through a "mock markup" before the administration formally sends Congress an implementing bill. The process allows lawmakers to communicate to the administration what language would gain approval in a final bill. Democratic leaders will want broad agreement among the party's rank-and-file, so the mock markup process does not become "uncontrolled" and expose deep divisions, Boustany claimed. Ways & Means Democrats, he said, are "going to set the stage and win over other Democrats in the caucus. If you don't have that, you run the risk of the markup blowing up.”

The White House cannot submit the USMCA implementing bill until both chambers of Congress return from the August recess. USMCA supporters are hoping for a late-September or early October vote. The closer the trade vote gets to the election, the more precarious its passage becomes, Paulsen and Boustany said. If Democratic presidential candidates vocally oppose USMCA, Pelosi may not want to move forward with it, Boustany added. -- Brett Fortnam


Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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