Rep. Henry Cuellar
is a Democrat from Texas and the Representative for the state’s 28th Congressional District. The district lies on the U.S.-Mexican border, and includes Laredo, Texas, which is America’s largest inland port. Last Wednesday, July 24, Representative Cuellar was the keynote speaker at the GBD colloquium on the future of NAFTA,
“Enhancing Cooperation: USMCA and The Business of North America.”
The dominant question for Representative Cuellar and indeed for all of the speakers at Wednesday’s event was, will the successor agreement to NAFTA, the United States-Mexico-Canada Agreement, be ratified by all three countries and implemented? Mexico has already ratified the agreement, and it is a reasonable guess that, if the United States approves the deal, so will Canada. (More on Canada in later entries.) As for the United States, Mr. Cuellar was unequivocally positive. He said it at the beginning of his talk, and he said it at the end. And he said it just that way, “NAFTA” will pass.
At the risk of wandering into commentary, we are quite sure that Representative Cuellar is fully aware of the name of the new agreement, but for him, as for many, USMCA is a continuation of NAFTA, not its repudiation. Here is a bit more from the first part of Mr. Cuellar’s remarks at GBD.
REP. CUELLAR:
"
We are going to pass NAFTA [USMCA].
We are going to do it. I’m telling you this. The matter is, when are we going to do it? September, October of this fall. We are going to do it. And the options – I’ve always said this to my colleagues – the options are very simple. One, we can go – what President Trump said at the very beginning, you know, repeal it, get out of it. I think
he called it the worst trade agreement in history. He was wrong, and we cannot get out of it.
[That’s] option Number 1.
"Option Number 2 is stay with the status quo. That is, stay with [what] we have. Can we move forward on that? Yes, we can. But, if we look at what the ’90s were compared to now,
option Number 3 is definitely the much better. That is, we modernize it. We make it better.
And that option is what we have. So, I always tell my – especially my Democrats: It’s very simple guys. You either get out of it – I don’t think you want to do that – Number 2, you either keep the status quo or you go into something better."
Rep. Cuellar was with us at GBD for the better part of an hour on Wednesday, and he covered a lot of ground, beginning with the importance of trade to Texas. Especially the 28th Congressional District of Texas, and especially Laredo. He talked about the agreement’s contentious issues of labor, particular the enforcement of the labor provisions of the USMCA, the environment, and pharmaceuticals. And, of course, he talked about politics and timing. But his starting point was Laredo.
Laredo, Texas, which Mr. Cuellar described as “a small town of 260,000 individuals,” is America’s largest inland port. What does that mean? Well it means that some 16,000 trailers a day cross the bridges that span the Rio Grande at Laredo. It means that Laredo is at the forefront of the kind of cooperation that an integrated North American economy requires. Mr. Cuellar offered this example:
"Laredo was the first place to have joint inspections by Mexican customs on it. And it was an interesting time as we set this up. We were ready to go but … literally Mexico had to change its law to allow guns – CBP officers [to] have guns over there. … Laredo Airport became the first place in the country to have joint inspections."
Labor.
The USMCA has strong labor provisions. There seems to be no debate over that, and Mr. Cuellar said he tells his Democratic colleagues they should be hailing those provisions as a victory because they include things that Democrats have been demanding for years. But, of course, the issue now is enforcement. Can Mexico hire the necessary judges fast enough? Will it be able to implement the laws it has put on the books?
We expect to highlight the details of those changes – both in the USMCA itself and in Mexican law – in later entries. One of the points, Rep. Cuellar made was that the United States has not given Mexicans the credit they deserve for the difficult changes they have made. He also pointed out that, with the current administration in Mexico, the U.S. may be pushing on an open door where labor is concerned. “I told my friends,” Mr. Cuellar said, “look at who is in office in Mexico.
AMLO – President Andrés Manuel López Obrador – is going to be somebody that is going to do a lot for workers.
… If there is anybody that will protect workers [in Mexico] it is this particular administration.”
Pharmaceuticals.
The agreement includes “a ten-year exclusivity period for test data used to develop biologic medicines.” Such a provision is well within the requirements of U.S. law but it is a point of contention in Congress, especially between Senate Republicans and House Democrats.
Rep. Earl Blumenauer
(D-Oregon), who chairs the Trade Subcommittee of Ways and Means, has said he doubts the agreement could clear the subcommittee with the current pharmaceutical language.
Rep. Cuellar did not wade into the pharmaceuticals debate except to note that
“You can’t blame the Mexicans or the Canadians.”
The provision at issue is there because the United States wanted it. (That said, both Canada and Mexico have expressed strong opposition to any reopening of the agreement.)
Environment.
We confess we are not quite clear on precisely what Democrats want to see in this area, and so this is another issue we plan to revisit. What we can say here is that Rep. Cuellar’s comments were intriguing. He said:
REP. CUELLAR
"It’s very simple, you get the NADB Bank. – Everybody familiar with the North American Development Bank? – and you make it part of the implementing language, and if you want to see water and certain things taken care of along the border, this is one way that you can address it. It has been around since the 1990s –you know, when the original NAFTA was signed. "
The Politics
. If there is a point of agreement about the politics of USMA, it is that the Speaker of the House,
Nancy Pelosi,
holds the key. Henry Cuellar clearly believes that the Speaker wants to see USMCA pass in the House this year. She visited Laredo this past February, he said, where she spoke at a university forum. She told that audience that she had voted for the original NAFTA, but added that, with respect to USMCA, work still needs to be done on enforcing the labor provisions of the agreement. On the critical question of timing, Rep. Cuellar put it this way:
Trump
can’t push her. As you know,
Pelosi will move it when she is ready.
I think President Bush with the Columbia agreement saw that. She will move it when she feels that the caucus is ready to move on it. … It is going to pass. The question is exactly when? And I’m hoping it will be sometime in the fall, I’ll say September, October, or November, no later than December. But it won’t go into election year. That I promise you. And then we will go ahead and vote on it. So I feel very confident that we will get it done.
