Donald Trump, as a candidate, promised to withdraw from the Trans-Pacific Partnership trade agreement. He delivered within one month of taking office. He also promised to renegotiate or withdraw from the North American Free Trade Agreement. Despite taking criticism from all sides, he has now delivered with the announcement of a new U.S.-Mexico trade agreement.
NAFTA, a trilateral trade deal the president once called “one of the greatest economic disasters,” contributed to our country’s growing, $800 billion goods trade deficit. In fact, today’s $70 billion U.S. goods trade deficit with Mexico used to be a $5.3 billion surplus in 1992 – before the deal was implemented.
While the 24-year-old agreement between the United States, Canada, and Mexico was meant to promote U.S. exports, it ultimately exported much of our auto, electronics, machinery, and other industries. Hundreds of thousands of American workers lost their jobs or received lower pay. Communities across Middle America were economically gutted.
In 2016, then-candidate Trump said he would renegotiate “a better deal for our workers.” Recently, he delivered with a new plan to reverse offshoring, create jobs here at home, and strengthen our relationship with Mexico. President Trump and Mexican President Enrique Pena Nieto agreed on mutually beneficial measures that will grow both nations’ economies and support American manufacturing, agriculture, workers and businesses.
The U.S.-Mexico agreement supports local vehicle production by increasing the percentage of auto content made in the U.S. or Mexico from 62.5 percent to 75 percent. It encourages well-paying American jobs and increased wages for Mexican workers to reverse the damage of cheap foreign labor. Other provisions protect American intellectual property, improve duty-free trade of food and agriculture, and increase transparency. The president has proven himself and the stage is set for Canada to either agree or be left out.
Since his early days in office, Trump outlined priorities for trade policy that include a stronger American economy, a focus on the American worker, enforcement of trade laws, and negotiations that ensure trade competitors do not take advantage of the United States. His deal with Mexico addresses each of those priorities — and the stock market has climbed to new heights in response.
As Canadian officials restart negotiations for inclusion, Trump will honor those same principles, doing what others have only talked about. Let’s not forget that in 2008, then-candidate Barack Obama said he would renegotiate what he called a “devastating” NAFTA. He did not do so. Early this year, Democrat members of Congress asked the president to “take a tough stand” on renegotiation.
Canada and the United States have shown a sincere commitment to bridging the remaining challenges in renegotiation. Negotiations during the past 13 months have stalled on the issues of the Chapter 19 dispute resolution provision, exemptions for Canadian cultural industries, and the lowering of access barriers to the Canadian dairy market for American Farmers. However, resolution to these politically thorny issues between the two nations are on the horizon. With the success of the U.S. deal with Mexico, Canada should be optimistic about their role in a renegotiated trade deal.
The president previously secured several other agreements on behalf of American workers, including one to reduce trade barriers with Europe and another with South Korea to bolster American manufacturing. With his latest news, he continues to prove he will fight for Americans’ interests, support our businesses, and stand for our industry at home and abroad. Thanks to Trump’s leadership, we are closer than ever to a modernized, pro-worker trade deal.
Dan DiMicco is former CEO and chairman of Nucor steel company. He served as a trade adviser to Donald Trump during Trump’s 2016 presidential campaign.
