Trump’s NAFTA replacement moves one step closer to final ratification

Members of the Senate Finance Committee on Tuesday morning approved President Donald Trump’s revised North American Free Trade Agreement, bringing the deal one step closer to ratification after a lengthy and contentious process.

The committee moved to advance the bill with a vote of 25-3. Two Republicans, Sens. Pat Toomey of Pennsylvania and Bill Cassidy of Louisiana, voted against it, along with Rhode Island Democratic Sen. Sheldon Whitehouse.

While lawmakers from both parties lauded the trade deal and urged its passage during Tuesday’s hearing, a number of Republicans hit the administration for changes made after months of secretive negotiations with House Democrats. Whitehouse argued the environmental provisions pushed by members of his party don’t go far enough.

Senate Republican leaders hope to move the trade pact closer to full passage in the days ahead, despite a procedural hurdle that will slow down consideration of the bill — and an impending impeachment trial that could halt the debate indefinitely. Yet the rebranded US-Mexico-Canada Agreement is expected to pass with broad support from both parties when it does come to the floor.

Finance Committee Chair Chuck Grassley quipped during Tuesday’s hearing that the winding road toward ratifying the agreement has “tested my patience at times,” pointing to Trump’s broad use of national security tariffs on foreign steel and aluminum. Canadian and Mexican officials demanded that the tariffs on their countries be lifted before codifying the trade deal, which Trump agreed to do after much urging on Grassley’s part.

“I don’t know how many White House meetings I attended where that was an issue,” Grassley said. “I kind of got tired of hearing the words, ‘I like tariffs.'”

Departure from free-trade orthodoxy

In several ways, the deal departs from the free trade orthodoxy the Republican Party had embraced in recent decades. Support from the AFL-CIO, the United States’ largest federation of unions, and staunch trade skeptics like Sens. Sherrod Brown of Ohio and Elizabeth Warren of Massachusetts only highlights that fact.

Grassley, who has been a steadfast advocate for passing the deal, admitted “there are some aspects of this bill that I don’t particularly like” in his opening statement. “But as I reflect on how we got here, I’m proud of the hard work of many individuals that made it possible to achieve a strong agreement, and a bill that could garner broad support.”

Some Republicans take issue with the deal’s new auto manufacturing and labor requirements, as well as the administration’s move to strip controversial patent protections for biologic drugs — a longtime GOP priority in trade negotiations — from the pact. But the party largely stuck with Trump when the USMCA came up for a vote in the House, where members overwhelmingly approved it with a vote of 385-41 before the holidays. Only two Republicans voted against it.

“It is a good agreement. It is not a perfect agreement,” Texas Republican Sen. John Cornyn said Tuesday. And Cassidy, the Louisiana Republican who voted against advancing it from the committee, said he was “very disturbed” that the Senate had so little input in the process. But no Republican was more critical of the agreement than Toomey, the Pennsylvania free-trader, who has vocally opposed it since it was first signed.

“It’s the first time we’re ever going to go backwards on a trade agreement,” he said Tuesday.

“There’s no economic growth here,” he added, slamming it as a deal “designed to restrict trade and investment.”

A sunset provision

Toomey also hit the inclusion of a sunset provision — “This thing goes poof in 16 years,” he said — and attempted to amend the legislation to require both houses of Congress to affirmatively vote on the matter before the USMCA can expire.

Nebraska Republican Ben Sasse, who recently joined the Finance Committee, said he agreed with Toomey’s complaints but argued it is still necessary to pass the agreement to help farmers.

Sen. John Thune of South Dakota also recognized shortcomings but said senators should not “let the perfect become the enemy of the good.”

Senate Majority Leader Mitch McConnell initially said the Senate would consider the trade pact only after the chamber’s impeachment trial concludes. But his thinking changed after House Speaker Nancy Pelosi decided to hold onto the articles of impeachment rather than sending them to the Senate while lawmakers seek a deal on the rules for the trial.

GOP leaders aimed to bring the trade agreement to the floor for a vote as soon as this week, but a ruling from the Senate parliamentarian has made that timing unlikely. The parliamentarian decided Monday that the USMCA implementing legislation needs to be considered by all of the relevant committees — including not just the Senate Finance Committee, but also six other panels.

The bill will have to go through the Health, Education, Labor, and Pensions Committee; the Environment and Public Works Committee; the Senate Appropriations Committee; the Foreign Relations Committee; the Budget Committee; and the Commerce, Science, and Transportation Committee. The mark-ups don’t have to happen in any particular order.

Under the rules for consideration of trade agreements, lawmakers cannot amend the USMCA in those mark-ups, so it simply depends on an up or down vote in each committee. But it takes time to schedule hearings; the decision could delay a floor vote by a week or more.