THE TTALK QUOTES


On Global Trade & Investment
Published Three Times a Week By:
The Global Business Dialogue, Inc.
Washington, DC  Tel: 202-559-9316
No. 77 of 2019
TUESDAY, NOVEMBER 26, 20219

Click HERE for Thursday's China quote from Rep. French Hill.
USMCA - AN UPDATE (with Gilbert & Sullivan)

 " We are within range of a substantially improved Agreement for America's workers. Now, we need to see our progress in writing from the Trade Representative for final Review."

Nancy Pelosi
November 25, 2019
CONTEXT
Whether USMCA – the United States-Mexico Canada Agreement – is nearing the summit of Congressional approval or circling the drain is still unclear, but the flurry of rhetoric these last few days suggests a dénouement of some sort. Consider these examples. 

GBD did not publish a TTALK Quote yesterday. Had we done so, we would have highlighted this comment from Speaker Pelosi’s press conference of last Thursday, November 21:

I am not even sure, if we came to agreement today, that it would be enough time to finish, but it just depends on how much agreement we come to.

The week before last she had talked about USMA legislation as being “imminent,” and so the remark on November 21 struck many as a recalibration, an adjustment in the management of expectations. That remark however, had been in response to a question and came after she had already declared that she was “eager to get this [USCMA] done.” Whatever her intention, her “not-enough-time” comment got the world’s attention. 

President Trump suggested it might mean the end of the agreement. Fielding press questions yesterday afternoon in the company of Prime Minister Boyko Borissov of Bulgaria, President Trump said:

Nancy Pelosi should put it up for a vote because, at some point pretty soon, you’re going to have Canada and you’re going have Mexico say, “What’s going on? Send the agreement back. Let’s not make the deal.” And I wouldn’t blame them at all. And that’s okay.  We’ll just blame Nancy.

To say the least, Mexico too is a paying attention.  President López Obrador said yesterday that he will send a letter to Speaker Pelosi this week urging her to move the USMCA legislation expeditiously. Speaking to reporters, he said, “I am sure that Mrs. Pelosi and the lawmakers of the Democratic Party are going to help us.” At the same time, other Mexican officials noted that new, intrusive labor demands by the United States would be rejected by Mexico. All that said, the fact that Mexico is now technically in recession adds more than a little hot chili to the USMCA tortilla.

COMMENT
If there is one topic we would rather to stay away from, it is the effort in the House to impeach President Trump. And yet it intrudes. Arguably, the nearly inevitable vote on impeachment and the hoped-for vote on USMCA are among the two most anticipated votes for members of the House. Republicans argue that Democrats have pushed aside key issues like USMCA to make room for their obsession with impeachment. Democrats obviously reject that line, but what is not clear – at least not to us – is just how they see the intersection of the two. It is hard to ignore the possibility that the timing of the USMCA vote, if there is one, will depend as much on the larger political picture as on the issues pertaining directly to the new North American trade agreement. 

With respect to those provisions, Speaker Pelosi has put a great deal of emphasis on the labor issues. That strikes us, in a way, as an odd complaint. If USMCA was meant to improve conditions for anyone, it was American workers, especially workers in the automotive sector. The agreement increases the required North American content for automobiles, including wage-rate minimums, both of which are meant to benefit workers in that sector. This is not the place for an economic assessment of those provisions. Our only point is that, technically, they are not labor provisions. The observer is left feeling at times like the billiard sharp in Gilbert and Sullivan’s The Mikado , playing “on a cloth untrue/With a twisted cue/And elliptical billiard balls.” 

Still, it is a game that can be won, with high scores for all three economies, Canada, Mexico, and the United States.  

SOURCES & LINKS
From the Speaker is a link to a statement on USMCA issued yesterday by the Speaker of the House, Rep. Nancy Pelosi (D-California). This was the source for today’s featured quote.

Press Conference on the 21st is a link to the C-Span Video of Speaker Pelosi’s press conference on November 21. Her comment about there not being enough time to get USMCA done this year begins roughly at the 18:35 minute mark.  November 14 is a link to the transcript of the Speaker’s press conference a week earlier. 

With Prime Minister Borissov is the transcript of yesterday’s session with the press at the White House yesterday before the bilateral meeting between President Trump and Prime Minister Borissov of Bulgaria.

López Obrador Weighs In is a link to a Reuters article on this development from yesterday’s New York Times. 
In Focus is a Library of Congress Summary of the USMCA, which includes brief descriptions of the auto and the labor provisions.

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