Since President Trump negotiated an overhaul of the North American Free Trade Agreement with Canada and Mexico, the U.S. Chamber of Commerce and its allies have held more than 1,000 meetings with members of Congress urging them to pass it.
The lobbying will only intensify during lawmakers’ traditional summer recess, CEO Tom Donohue promised Thursday during a news briefing with trade associations representing the retail, agriculture and manufacturing industries.
Company executives and small-business owners will confer with members of Congress in their districts, hoping to show them in person how individual factories and stores rely on supply chains that cross the boundary lines between the U.S. and its neighbors and need the revised treaty for stability.
The U.S.-Mexico-Canada Agreement, or USMCA, as the administration has dubbed it, represents about $4 billion a day in trade — a total $1.4 trillion a year. While the terms of the deal were set in 2018, it wasn’t ratified by Congress before Republicans lost control of the House during mid-term elections, complicating its approval prospects.
“This deal is critical to all our members, to our broader economy and to the long-term prosperity of our country,” Donohue said. “Getting approval of the USMCA will require bipartisan cooperation. That is the only path forward. While there may be gaps between Republicans and Democrats, these gaps can clearly be bridged.”
Though Democrats support updating the the Clinton-era North American Free Trade Agreement, Speaker Nancy Pelosi said her party wants to ensure the new deal has enforcement mechanisms and will benefit working families, protect the environment and lower prescription-drug costs.
“We want to pass this bill,” she said at a news conference in late June, holding out the possibility that her caucus would seek “surgical” revisions to the agreement itself before moving legislation enacting it. “We do not want to pass this agreement just slightly different from NAFTA with a little sugar on top and say, ‘See, we did something different.'”
Approving the treaty sooner rather than later is particularly critical with the 2020 presidential election drawing closer, Donohue said.
“Everything that moves is touched by the USMCA and by its predecessor, NAFTA,” from blue jeans to asparagus and auto parts, said Matthew Shay president of the National Retail Federation, whose members employ 42 million Americans.
Sophisticated, complex supply chains would be “dramatically disrupted if we didn’t move forward with the USMCA,” he said. “There are certainly going to be some disagreements over details. There always are. That’s not a surprise, and we shouldn’t let the process of sorting out some of those details disrupt the overall objective of accomplishing this trade deal.”
The deal is just as important to U.S. farmers, with roughly 20% of American crops dedicated to exports, which have already been curbed by the U.S. trade fight with China.
Growers need ratification to solidify their top two markets outside the U.S. and open opportunities for shipments of dairy, eggs and wheat, said John Bode, president of the Corn Refiners Association.
If Congress fails to approve the USMCA, he said, “it will be very hard to negotiate new agreements with other countries. The gaps that stand between USMCA and ratification are bridgeable. We critically need bipartisan collaboration.”
Donohue said the group is prepared to provide political cover to vulnerable lawmakers who back the deal.
“If they don’t do the right thing,” he said, “they’re not going to necessarily worry about hearing from us. They’ll have to worry about hearing from their voters.”
Passage would be a significant win for Trump, who promised to replace the NAFTA agreement during his 2016 campaign and could tout his success as he fights for re-election.
“Since NAFTA’s adoption, the U.S. was losing jobs and losing plants like nobody has ever lost before,” he said in a July 12 speech at an aerospace plant in Milwaukee, Wis.
Its replacement “will be the most modern, cutting-edge trade agreement in history, with the strongest protections for the American worker ever put in any trade agreement,” Trump added, citing Mexico’s agreement to tough new labor and environmental standards. “That was the single-most important thing to me.”
Among other provisions, the USMCA requires that at least 40% of manufactured cars originate from factories that pay more than $16 per hour. Manufacturers will be required to produce 75% of a vehicle in North America to avoid tariffs, up from a prior 60%.
“Almost one in five auto jobs were lost under NAFTA,” the president said. “The USMCA will close the biggest loopholes that caused the mass exodus.”
