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President Trump’s effort to rework a major trade deal with Canada and Mexico is showing signs of faltering on Capitol Hill, straining under complaints from lawmakers of both parties who won’t commit to backing the plan.
Mr. Trump reached agreement with Canada and Mexico last year to update the 1994 North American Free Trade Agreement.
But Congress must approve the deal, and the White House has been unable to mollify critics.
In the latest obstacle, key Republican senators including Finance Committee Chairman Charles Grassley (R., Iowa) have insisted that Mr. Trump lift steel and aluminum tariffs imposed on Canada and Mexico as a precondition to any congressional vote.
Mr. Grassley said Thursday that he had made the case directly to Mr. Trump at a recent meeting, but the President refused to budge.
Mr. Grassley predicted Mr. Trump would have no choice but to give in if he wants the North American Free Trade Agreement replacement deal to advance.
“The tariffs are going to come off because the President has a good agreement,” Mr. Grassley said.
“It’s just a matter of his realizing that nothing’s going to happen until the tariffs go off. And so the tariffs come off if he wants to get a win.”
White House advisers, including U.S. Trade Representative Robert Lighthizer, are refusing to cancel the tariffs until Canada and Mexico accept quotas on their metals exports.
The tariffs were imposed last year in response to a flood of Chinese steel that depressed global prices and dented the fortunes of American steelmakers.
The Trump Administration now wants quotas as a fallback defense against shipments from China making their way to the U.S. market via Canada or Mexico.
For Canada, too, the tariffs are the biggest sticking point to consideration of a deal.
Prime Minister Justin Trudeau’s government, weakened by domestic political controversy, faces voters in October.
The revised trade deal would require more automobile components to be assembled in North America to avoid import penalties, impose higher wage provisions, open up Canada’s dairy sector, and include stricter rules for intellectual property and Internet commerce.
Support from House Democrats would be crucial for the new trade deal to advance, but they have raised a host of issues.
Some liberals have said the deal is a nonstarter because of a provision related to prescription drugs — a stance that has irked fellow Democrats who are more oriented toward free trade.
House Speaker Nancy Pelosi (D., Calif.) can single-handedly determine the pact’s fate by deciding whether to put it to a vote.
She said she needs to see stronger enforcement provisions in the deal before agreeing to embrace it.
“We need to see enforcement. I’ve said it all along. It’s no mystery,” Ms. Pelosi said. Ms. Pelosi is referring to a common complaint from Democrats and labor groups, which is that they want to know what specific penalties Mexico and Canada might face if they flout the rules.
The unresolved issues have left the process up in the air.
White House officials have said they will work with lawmakers to try to address concerns, but they rule out reopening the trade deal to satisfy Democrats’ demands for tougher labor, environmental, and enforcement provisions, because identical versions must be approved by Mexico and Canada.
If U.S. lawmakers don’t eventually pass the deal, Mr. Trump has threatened to try to terminate the existing NAFTA, a prospect that concerns lawmakers from both parties and the business community.
“I don’t think trying to jam Congress is a good idea,” said Sen. John Cornyn (R., Texas).
He said the deal currently doesn’t command the votes to pass, partly because of the tariff issue.
But Trump Administration officials are in the middle of several trade-related fights elsewhere, and it’s unclear how much time they have been willing to devote to the Canada and Mexico deal.
Mr. Trump declared victory on the Mexico and Canada talks last year, when he notched a tentative agreement with leaders from both countries, but the deal is not complete until it is ratified by Congress.
In the House, liberals have coalesced against provisions codifying exclusive rights to a class of drugs known as biologics for 10 years, something they say makes the entire deal a nonstarter.
At the same time, administration efforts to woo organized labor thus far have fallen short.
Source: Toledo Blade