President Donald Trump’s scheme to terminate NAFTA in order to force Congress to choose between his new NAFTA or no trade deal at all is backfiring as Senate Republicans warn him not to do it.
In December, Trump boarded Air Force One after signing a slightly tweaked version of NAFTA he likes to call the USMCA and told reporters that he will soon withdraw the United States from NAFTA to give Congress a choice between his deal or no deal at all.
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“I will be formally terminating NAFTA shortly,” Trump said. “Then Congress will have a choice of approving the USMCA, which is a phenomenal deal. Much, much better than NAFTA. A great deal. It’s caused us tremendous amounts of unemployment and loss and company loss and everything else. That’ll be terminated. And so Congress will have a choice of the USMCA or pre-NAFTA, which worked very well.”
Actually, NAFTA currently supports 14 million jobs in the United States and all three nations, Canada, Mexico, and the United States, benefited economically from it.
Trump is trying to take credit for a trade deal by changing a couple little things in the old deal and slapping a new name on it. But getting it ratified by Congress is going to be difficult because Democrats control the House. Plus, Mexico and Canada would both have to ratify it as well.
If Trump kills the current deal in a temper tantrum because Congress won’t ratify his new one, he would blow up the economy, and that is scaring Senate Republicans enough that they are warning him not to do it.
According to Reuters:
Senator John Cornyn, a Texas Republican, told reporters it would be “immeasurably harder if the president decided to withdraw from NAFTA and then tried to jam Congress.”
Cornyn said U.S. Trade Representative Robert Lighthizer told senators that it was not his decision and he would pass their concerns onto Trump. Lighthizer declined to comment after meeting with senators for more than 90 minutes.
Senator Charles Grassley, who chairs the Finance Committee that overseas trade issues, said after the meeting that the issue of withdrawing from NAFTA was discussed “and we all said that that would be a bad thing to do.”
Asked why he opposed a withdrawal, Grassley added: “I think it is very unrealistic in any environment to think you’re ever going to get Canada and Mexico back to the bargaining table.”
Republican senators also oppose the auto tariffs in Trump’s new deal, which would hurt car manufacturing in certain states, particularly red states where automakers employ thousands of their constituents in South Carolina, Alabama, and Tennessee.
Senator Chuck Grassley (R-Iowa), opposes the tariffs because “they don’t have much to do with national security.”
Senator Lamar Alexander (R-Tenn.), meanwhile opposes Trump’s tariffs on steel and aluminum, which are also hurting automakers.
“They are making it harder to build cars in Tennessee,” he said. “You can’t build more cars and have more jobs in the United States if you have the highest priced steel.”
If Trump decides to withdraw from the deal, Senate Republicans would be forced to block his action, which they can legally do since trade deals are ratified by Congress and enforced through legislation. Trump could be humiliated by his own party if he defies their warning, which would put both Republicans and Trump in a difficult spot in 2020.
Therefore, Trump would be wise to listen because the alternative would be disastrous for our economy and his re-election chances. But since when has Trump ever been wise? After all, he shut down the government for 35 days over a wall.
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