President Donald Trump really, really wants Congress to approve the United States-Mexico-Canada Agreement (USMCA) to prove he can land a big “deal” on trade. House Speaker Nancy Pelosi (D-CA) holds the key to his dream coming true. But will she call a vote before 2019 ends? There are certainly enough Democrats ready to join with Republicans in the House to approve the agreement. And the closer US Trade Representative (USTR) Robert Lighthizer works with Congress, the greater the political appetite of Democrats to support it. But Speaker Pelosi’s foremost political objective is to put a Democrat in the White House in 2021. The question is whether USMCA ratification helps or hurts her larger strategy.
The number of Democratic members supporting USMCA is growing. Added to certain Republican votes, their support should ensure a bipartisan majority in the House. And Senate ratification is virtually certain. House Ways and Means Committee Chairman Richard Neal (D-MA) recently shared his optimism about reaching an agreement with the administration on needed changes to the USMCA text. A letter sent by 14 House Democrats to Speaker Pelosi, urging a vote on the pact, suggests latent support for USMCA. And a previous blog identified congressional districts heavily dependent on exports to Mexico and Canada, arguing that those representatives would be strongly motivated to vote for USMCA, whatever the misgivings of organized labor and other opponents.
And yet Speaker Pelosi has held up a vote until the pact is revised to meet her party’s demands on multiple issues: enforcement provisions, labor and environmental protection, pharmaceutical access, and others. Concerned about enforcement of labor reform in Mexico, Democrats insist on impartial inspections of Mexican factories suspected of violating labor standards. They criticize the environment chapter for the absence of provisions to mitigate climate change. In September 2019, more than 100 House Democrats sent a letter to President Trump demanding that the USMCA meaningfully address climate change and require the United States to remain in the Paris Climate Agreement, though Representative Neal did not sign the letter. Democrats also oppose features that might protect big pharmaceutical companies from generic competition and raise drug prices. These demands and more are the subject of negotiations between a House USMCA Working Group, led by House Ways and Means Chairman Neal, and Ambassador Lighthizer.
Adding to the pressure, Mexico ratified the text of USMCA on June 19, 2019, passing the reform bill that strengthens workers’ right to organize and to have a say on labor contracts. The new Canadian parliament to be formed after the national election on October 21, 2019, will soon vote on the pact. Canadian deliberations could overlap with the final stages of a ratification debate in the US House of Representatives.
While the Trump administration’s willingness to meet congressional demands, at least halfway, is critical to securing US ratification, that may not be enough to move Pelosi. She needs a strategy that accords with Democratic themes leading into the 2020 presidential election. Frontrunner former vice president Joseph Biden has stated that Congress should not approve USMCA until satisfactory changes on labor, the environment, and pharmaceuticals have been made. His statement allows ample room to denounce compromise language between the House USMCA Working Group and the administration. Senator Elizabeth Warren’s trade policy manifesto is replete with social demands that go far beyond the USMCA text. Senator Bernie Sanders loudly denounces virtually all trade agreements as mechanisms for enriching multinational corporations and impoverishing ordinary Americans.
If Biden is still the frontrunner when players are aligned for a House vote, his yea or nay on USMCA will likely decide Pelosi’s willingness to bring USMCA to the floor. If Warren or Sanders is ascendant, or even nipping at Biden’s heels, political incentives will call for Pelosi to keep USMCA on the backburner in 2019 and continue deliberations in 2020. In short, only the improbable combination of a decisive Biden lead and his full-throated endorsement of USMCA makes for a bright outlook.
1. The letter was led by Representatives Colin Allred (Texas) and Scott Peters (California) and signed by Representatives Kendra Horn (Oklahoma), Haley Stevens (Michigan), Anthony Brindisi (New York), Joe Cunningham (South Carolina), Lizzie Fletcher (Texas), Ben McAdams (Utah), Josh Harder (California), J. Luis Correa (California), Sharice Davids (Kansas), T. J. Cox (California), Susie Lee (Nevada), and Greg Stanton (Arizona).
2. The House Committee on Ways and Means sent letters to USTR Lighthizer on their concerns with USMCA in April and May 2019.