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By Tim Nerozzi
President Trump crowed that he had delivered on a campaign promise that will deliver “cash and jobs” to U.S. workers by successfully renegotiating the North American Free Trade Agreement.
Trump Also Tweeted:
What it Means:
The United States-Mexico-Canada Agreement, nicknamed “NAFTA 2.0,” is the first overhaul of North American trade policies in 25 years.
“The President is keeping his promise to renegotiate NAFTA, and this achievement is a mutually beneficial win for North American workers, farmers, ranchers, and businesses,” said the Office of the United States Trade Representative on the its official website. “When finalized and implemented, the agreement will create more balanced, reciprocal trade that supports high-paying jobs for Americans and grows the North American economy.”
After over a year of negotiations, the White House said the new deal will be especially helpful to American dairy farmers, who had faced import limits from Canada, and automobile workers. Moving forward, automobiles will only qualify for tariff exemption if 75 percent of its components are made within the country. The new pact also stipulates that at least 30 percent of work on automobiles must be conducted by workers making at least $16 an hour starting in 2020, increasing to 40 percent in 2023. This should make higher-paid American workers more competitive but it may also increase the cost of vehicles.
Per the agreement, Mexico has decided to give workers the right to unionize – which should drive up wages and prices – and take steps to eliminate gender discrimination in the workplace.
In addition, the pact has more safeguards for intellectual property rights and extends copyright protection to 70 years past the death of the author.
Why It Matters:
The Trade Representative Office has said that the new agreement is necessary for “creating a more level playing field for American workers,” “benefiting American farmers, ranchers, and agribusinesses,” and “supporting a 21st Century economy.”
The only things standing in the way of the new USMCA are a vote from the United States Congress and the signatures of President Trump, Canadian Prime Minister Trudeau, and Mexican President-Elect Obrador.
If the trade agreement is not passed before the midterm elections later this year, Trump may be in trouble. If the midterms swing in favor of Democrats, they may be liable to kill the bill to avoid letting Trump score points with the American public.
What People Are Saying:
On Twitter, Trudeau was slightly less flamboyant. From his official account, he posted a photo of his meeting with the Quebec team at the Canadian national caucus, saying that the new USMCA would create “jobs and opportunities” for “Quebecers and all Canadians.”
President-Elect Lopez of Mexico also known by the nickname “AMLO” was silent online, not yet mentioning the trade deal on his official social media.