Senate Panel Approves USMCA, Moving It One Step Closer to Ratification

January 8, 2020 by Dan McCue
Sen. Charles Grassley (R-Iowa) speaks at the U.S. Capitol in Washington D.C. on September 27, 2018. (Tom Williams/Pool/Sipa USA/TNS)

WASHINGTON – The Senate Finance Committee on Tuesday gave its approval to the new U.S.-Mexico-Canada trade agreement, moving it a step closer to ratification.

The 25-3 vote by the committee sent the trade deal, also known simply as USMCA, to the full Senate.

The House approved the agreement in a bipartisan vote.

During the 2016 campaign, President Donald Trump described the 1994 North American Free Trade Agreement or NAFTA, as a killer of American jobs and vowed to repeal and replace it.

Among other things, the new deal includes enhanced protections for auto industry workers, updated digital trade rules, and increased access for U.S. farmers to the Canadian dairy market.

“USMCA will bring much needed certainty and real benefits to America’s farmers, workers and businesses,” Finance Committee Chairman Sen. Chuck Grassley, R-Iowa, said Tuesday at the start of the bill markup.

“In terms of competition, the USMCA boosts American businesses by modernizing our current trade agreement, which predated internet commerce, to protect the flow of digital trade and to better safeguard intellectual property,” said Sen. Maggie Hassan, D-N.H. “The agreement also cuts red tape for small exporters by allowing electronic filing of customs forms, an important provision for a small business state like New Hampshire.”

“In addition…the deal cuts costs for small businesses by increasing the share of shipments to Canada and Mexico with duty-free status. Further, the USMCA removes long-standing trade barriers that have prevented dairy farmers in New Hampshire and other states from accessing the Canadian market,” she said.

However, before reaching this point, the agreement was substantially amended by House Democrats to improve enforcement of labor and environmental standards.

That allowed most Democrats in Congress to support the agreement, and helped sway doubters like Sen. Ron Wyden, D-Ore., the ranking member of the Senate Finance Committee.

On Tuesday, Wyden described the last few years as a time of “one trade gut punch after another,” referring to President Donald Trump’s trade war with China.

By contrast, he said, the new USMCA would provide “real certainty and predictability to Americans who want to grow things here, who want to make things here … and who want to ship those products around the world.”

In a tweet before the vote he specifically acknowledged the efforts of House Speaker Nancy Pelosi, saying the changes she was able to secure put “American workers first” while implementing “real trade enforcement.”

Like Wyden, Sen. Sherrod Brown, D-Ohio, had been a USMCA skeptic, but ultimately voted in favor of it. 

Brown said, “We know why corporations move jobs overseas – they can pay lower wages and exploit workers.

“The only way to stop that race to the bottom is by raising labor standards in every country we trade with. That’s why Ranking Member Wyden and I authored a completely new way of holding corporations accountable, our Brown-Wyden worker protection provision,” he said. “Brown-Wyden is the first improvement to enforcing the labor standards in our trade agreements since we’ve been negotiating them.

“We still have more work to do to make our trade agreements more pro-worker, but I am voting ‘yes’ for the first time on a trade agreement because, by including Brown-Wyden, Democrats have made this agreement much more pro-worker and set an important precedent that Brown-Wyden must be included in every future trade agreement,” he said.

Three Senate Finance Committee members voted against the deal Tuesday. They were Sens. Pat Toomey, R-Pa., Sheldon Whitehouse, D-R.I., and Bill Cassidy, R-La.

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