Mexico has increased the minimum wage for its workers, but that may not be enough to satisfy Democrats who wanted more extensive reforms in that country before they support President Trump’s U.S.-Mexico-Canada Trade agreement.
Effective Jan. 1, Mexico’s minimum wage will rise to the equivalent of about $5 a day, compared with $7.25 an hour in the U.S. In certain northern border regions, the rate will be $9 a day. However, the USMCA deal, which would replace the existing North American Free Trade Agreement, stipulates that at least 40 percent of factory workers involved in auto components must make $16 an hour. Mexico’s announcement of its new wage rates makes no mention of auto wages or any rate that high.
Will that cut it for congressional Democrats? “Short answer, no,” said Mark Greenbaum, spokesman for Rep. Bill Pascrell, D-N.J. The deal will be voted on next year, after the Democrats regain control of the House.
Rep. Nancy Pelosi, D-Calif., who is expected to return as speaker, earlier this month told reporters that “central to going forward [on USMCA] is that Mexico is supposed to pass a bill that would address the wages and working conditions of Mexican workers.” Her office did not respond to requests for comment Wednesday.
Mexico did make other moves to address labor issues, such as ratifying section No. 98 of the International Labour Organization Convention, guaranteeing collective bargaining rights, in September.
The Trump administration is already facing a difficult path to getting USMCA approved, as the deal has faced criticism from both sides of the aisle. Republicans like Sens. Marco Rubio of Florida and Pat Toomey of Pennsylvania say they cannot support it in its current form without more free-market reforms. Sen. Elizabeth Warren, D-Mass., has called on Trump to re-open negotiations with Mexico and Canada.
The president has tried to up the pressure on Congress by threatening to formally pull out of the NAFTA before USMCA is approved, giving lawmakers the choice of OK’ing the replacement deal or leaving the U.S. without one.
Major trade associations like the Chamber of Commerce and the American Farm Bureau Federation have announced they’ll push for USMCA’s passage too, despite earlier reservations.
It’s likely lawmakers can be swayed, though. While many have been critical of USMCA, few have come out and said they are dead set on opposing it. Lawmakers argue that a lot depends on how the deal’s implementing language is written, the one area where Congress can still alter the deal.
