Trump Signs USMCA, Declaring an End to ‘the NAFTA Nightmare’

January 29, 2020 by Dan McCue
President Donald Trump speaks during an event at the White House to sign a new North American trade agreement with Canada and Mexico, Wednesday, Jan. 29, 2020, in Washington. Vice President Mike Pence is left and U.S. Trade Representative Robert Lighthizer is right. (AP Photo/Alex Brandon)

WASHINGTON – President Donald Trump signed the new North American trade deal into law on Wednesday, declaring an end to “the NAFTA nightmare” and the beginning of a “glorious future.”

During an outdoor signing ceremony at the White House, Trump said, “This is a cutting-edge, state-of-the-art agreement that protects, defends, and serves the great people of our country.”

Flanked by Vice President Mike Pence and U.S. Trade Representative Robert Lighthizer, Trump declared the day the start of “building a glorious future that is raised, grown, built and made right here in the glorious U.S.A.”

Trump made renegotiating the North American Free Trade Agreement a priority during his 2016 campaign, though trade experts say the impact of the new USMCA will be modest given that Canada and Mexico already represent the top two export markets for U.S. goods.

The trade deal ultimately received strong bipartisanship in Congress, but that bipartisanship was not evident at the White House Wednesday.

While more than 70 Republican members of Congress were on hand, not a single Democrat had been invited.

On Capitol Hill, Democratic leaders said, though they may not be on hand for the photo op, their role in crafting and passing the trade deal will still be felt across America.

“What the president will be signing is quite different from what the president sent us,” said House Speaker Nancy Pelosi, D-Calif. “We were able to make vast improvements. If we weren’t, we would not have been able to pass the bill.”

Rep. Richard Neal, D-Mass., chairman of the House Ways and Means Committee, also said the trade agreement only passed Congress because of how the Democrats forced changes in Trump’s original proposal.

NAFTA, which took effect in 1994 under President Bill Clinton, removed trade barriers among the three North American countries and commerce surged.

However, Trump and other critics said NAFTA encouraged factories to leave the United States and relocate south of the border to take advantage of low-wage Mexican labor.

The new agreement, for example, requires automakers to get 75% of their production content (up from 62.5% in NAFTA) from within North America to qualify for the pact’s duty-free benefits.

At least 40% of vehicles would also have to originate in places where workers earn at least $16 an hour. That would benefit the United States and Canada — not Mexico, where auto assembly workers are paid a fraction of that amount.

The independent U.S. International Trade Commission last year calculated that the U.S.-Mexico-Canada deal would add 0.35%, or $68 billion, to economic growth and generate 176,000 jobs over six years.

Among those cheering the USMCA Wednesday was Brody Stapel, a dairy farmer in eastern Wisconsin and president of the Green Bay-based Edge Dairy Farmer Cooperative, who said, “This is a tremendous victory for America’s dairy farmers. In preserving the well-established markets of Mexico and Canada, and providing opportunities for even more exports there, USMCA will help bring the long-term economic stability necessary for farmers to not only survive but thrive.

“The outlook is far brighter today for farmers’ businesses, families and employees, and our rural communities because of this historic agreement, which also benefits so many other parts of America’s economy. We have reason to celebrate,” he continued.

“Congress and the administration deserve praise for recognizing how critically important USMCA is and for putting divisive politics aside to make it a reality,” he said.

Also quite pleased was Zippy Duvall, president of the American Farm Bureau.

“There is definitely increased optimism on farms and ranches across America and we’re grateful for the advances, but we’re also realists eager to see results – especially for our dairy and wheat producers,” Duvall said. 

“We know it will take time for the new deals to go into effect and translate into increased sales. We’re eager to get back into full swing supplying safe, high-quality food and agricultural products around the world,” he concluded.

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