While at the Group of 20 summit in Argentina, President Donald Trump on Friday joined leaders from Canada and Mexico to sign the USMCA deal, which is basically an updated version of the North American Free Trade Agreement (NAFTA) — this time with a new name.
Calling the former agreement a “disaster,” Trump hailed the new deal as “groundbreaking.” The president shook hands at the signing with Canadian Prime Minister Justin Trudeau and outgoing Mexican President Enrique Peña Nieto (who is being replaced on Saturday by new president Manuel Lopez Obrador).
Just signed one of the most important, and largest, Trade Deals in U.S. and World History. The United States, Mexico and Canada worked so well together in crafting this great document. The terrible NAFTA will soon be gone. The USMCA will be fantastic for all!
— Donald J. Trump (@realDonaldTrump) November 30, 2018
But there’s much work to be done before the deal can go into effect. To start with, there seems to be little agreement on even the name of the deal. President Trump unilaterally named the agreement USCMA. Trudeau calls it “the new NAFTA” — though official documents will likely refer to it as the “CUSMA,” putting Canada first. Mexico has also played with the name, going with MUSCA at times.
Watch live: Prime Minister Justin Trudeau participates in a signing ceremony for the new North American Free Trade Agreement. https://t.co/gveErSjrK5 pic.twitter.com/H5hJy8gGcR
— CanadianPM (@CanadianPM) November 30, 2018
More substantial issues also remain. Trudeau said the steel and aluminum tariffs the Trump administration slapped on Mexico and Canada in May will have to be lifted. Furthermore, lawmakers in all three countries have to sign off the deal, which might prove to be a major hurdle in the United States, with the Democrats taking control of the House of Representatives in the midterm elections.
House Democrats are demanding changes to the deal, calling for stronger labor and environmental protections, closing the loopholes in existing protections written into the agreement.
Earlier this month, Rep. Bill Pascrell (D-NJ), who is expected to chair the Ways and Means Trade subcommittee, said that changes to enforcement mechanisms would be necessary before the deal gets through the House.
Also, the U.S. International Trade Commission has yet to release its report on how USMCA/New NAFTA will affect the U.S. economy.
That report is expected sometime between January and March, and lawmakers are almost certain to hold off on voting on the deal until they see those numbers. Without a law that allows for its implementation, the deal will die on the vine.
Signaling a more widespread Democratic opposition to the agreement, Sen. Elizabeth Warren (D-MA) in a speech on Thursday slammed the deal, blaming it for news of jobs cuts announced at General Motors earlier this week.
“For decades, the leaders of both parties preached the gospel that free trade was a rising tide that would lift all boats,” said Warren. “Great rhetoric — except that the trade deals they negotiated mainly lifted the yachts — and threw millions of working Americans overboard to drown.”