Only in Washington could the Speaker of the House announce articles of impeachment against the president one minute, then join him in celebrating a bipartisan agreement over North American trade the next.
Political necessity can engender strange behavior. We don’t pretend to know why it took House Speaker Nancy Pelosi 15 months to offer what have been described as minor tweaks to the United States-Mexico-Canada Agreement, or USMCA, allowing for its passage. Nor do we know whether she saw some political advantage to doing this in the middle of an impeachment process that is, at best, politically risky for Democrats.
But we do know ratification of the USMCA would be a good thing, and we urge Congress to do so quickly.
Indeed, it’s hard to find anyone desiring to speak against this agreement, which would replace NAFTA as the document governing the exchange of goods and services among the three North American neighbors.
As with so many recent trade matters, it was born out of presidential hyperbole, with President Donald Trump casting aside NAFTA as being one of the worst trade agreements ever. That was not true, as evidenced by how much the USMCA mimics NAFTA. But the new agreement offers a much-needed upgrade to that earlier agreement, which was signed before the internet age. It does much to protect the auto industry from the type of low-wage exploitation critics say has led manufacturers to move south of the border.
The USMCA requires the three countries to adhere to the standards of the International Labor Organization’s Declaration on Fundamental Principles and Rights at Work. In terms of automobile manufacturing, 75% of components must be manufactured in one of the three countries, and 30% of the autos must be built by people making at least $16 per hour. In 2023, that will rise to 40%.
This serves two purposes. It makes it less attractive for U.S. manufacturers to move to Mexico, but it also improves the lives of Mexican workers already employed at such plants.
The agreement also contains environmental protections, complete with enforcement mechanisms.
Mexico’s living standards increased greatly during NAFTA’s tenure. They have a long way to go to rival standards in the U.S. or Canada, but it’s clear that a more prosperous, environmentally conscious Mexico would ease a number of problems, including undocumented immigration.
But the most important reason to ratify the USMCA is that it would inject a strong dose of certainty into business transactions among the three nations. It would re-enthrone the principle of free trade in those relationships, replacing costly tariffs and uncertainties.
That’s a recipe for prosperity, and it may be what the continent needs to keep the current economic expansion going a while longer.
Now that all the objections have been cleared, Congress should take a few moments out from impeachment hearings and quickly ratify this agreement. Then, the administration should work hard to complete similar trade agreements in other parts of the world, including China.