The Office of the U.S. Trade Representative’s U.S.-Mexico-Canada Agreement counterproposal to House Democrats is being kept under wraps due to national security, House Ways & Means Committee Chairman Richard Neal (D-MA) told Inside U.S. Trade on Thursday.
In August, a USMCA working group set up by House Speaker Nancy Pelosi (D-CA) sent USTR a proposal for how to address the Democrats’ concerns with the trade deal in four key areas: labor, the environment, access to medicines and enforceability. USTR on Wednesday sent the working group its counterproposal.
The information in the Democrats’ proposal and USTR’s counter is “protected information” because USMCA, “like all trade agreements,” is a “national security” matter, Neal said when asked if he had had an opportunity to review USTR’s response yet.
Neal did not specify what security markings were being used to restrict access to the documents.
“Trade policy, like any other policy, touches on national security,” Simon Lester, a trade specialist at the libertarian Cato Institute, told Inside U.S. Trade, but “here they seem to be pretty weak.”
USTR Robert Lighthizer on Wednesday met with House Republican’s USMCA whip team, including Ways & Means ranking member Kevin Brady (R-TX), before the agency sent the document to Congress.
Brady told reporters after the meeting he would “leave it for his Democratic colleagues and Ambassador Lighthizer to release the details."
Ways & Means trade subcommittee ranking member Vern Buchanan (R-FL) told Inside US Trade on Thursday that Republicans on the committee had not seen the counterproposal but added that he was “sure it’ll be a long list” and said he expected to speak with Lighthizer on Friday “to just see where we’re at.”
Buchanan was also at the Wednesday meeting with Lighthizer.
“I think -- not all -- but a lot of the Democrats want to get to yes, including the Speaker [Pelosi],” Buchanan said. “It’s a huge deal -- $1.3 trillion, 15 million jobs for the U.S. alone.”
Pelosi on Thursday told reporters Democrats were waiting for language on how USMCA will be enforced.
“We are in conversations, back and forth with the administration on the U.S.-Mexico-Canada Agreement. We’re just waiting for language about enforceability,” Pelosi said. “I supported NAFTA the first time around; those who didn’t are even more eager to make it better now. In order to be made better it has to be improved greatly in terms of enforcement. I’m optimistic as we go forward that we will come to terms."
Pelosi also noted that for those who are “urging us to put it on the floor, there’s nothing to put on the floor” yet. The Trump administration has not sent a USMCA implementing bill to Congress, in part because an agreement with Democrats’ concerns has not been reached. Some Republican lawmakers and other USMCA advocates, however, have repeatedly accused her of stalling on the bill.
“When we do get that agreement then we’ll get the letter for the enabling legislation from the administration,” Pelosi said.
One ongoing concern for Democrats is whether the deal does enough to ensure Mexico will live up to its labor obligations under the agreement. Mexican officials, including Ambassador to the U.S. Martha Bárcena and Under Secretary for North America Jesús Seade, were on Capitol Hill on Thursday to discuss USMCA ratification efforts and Mexico’s budget for 2020, Seade told Inside U.S. Trade.
Mexico’s budget proposal, which was sent by President Andrés Manuel López Obrador to Mexico’s Congress on Sunday, includes funding details for the implementation of Mexico’s recently passed labor reform legislation.
Some Democrats and unionists contend they need to know specifically how labor reform will be seen through before they can back USMCA. An AFL-CIO source told Inside U.S. Trade this week the group initially was not pleased with the labor reform funding in López Obrador’s proposal but was waiting for the Mexican government to explain the details.
“We’re speaking about the budget and the reform in Mexico and explaining that this is going really strongly,” Seade said on Capitol Hill on Thursday, adding that a proposed budget cut to the Labor Ministry -- a red flag for the AFL-CIO and United Steel Workers -- has not been discussed “yet.”
A USW legislation specialist told Inside U.S. Trade the proposed budget cut to the Labor Ministry was “concerning,” though the union was encouraged to see funding requested for an initial 20 federal labor courts.
The legislation specialist said USW was in "constant contact" with officials in Mexico and would be working with the AFL-CIO as well on labor reform implementation.
Democratic Sens. Sherrod Brown (OH) and Ron Wyden (OR) in April proposed a U.S.-Mexico labor cooperation mechanism that USTR planned to pull heavily from as the agency worked on USMCA solutions with House Democrats.
Neither met with Mexican officials on Thursday, the senators told Inside U.S. Trade.
Brown on Wednesday said he was in communication with USTR “all the time,” adding that Mexico was “so far resistant” to some U.S. requests, “but we keep trying."
Seade has said the Mexican government will not accept U.S. inspectors in Mexican facilities suspected of labor rights violations -- a component of the Wyden-Brown proposal.
Brady touted Mexico’s labor reform approach on Wednesday, calling it “transformational” and “a game changer."
Brady in August traveled to Mexico to meet with government officials including Foreign Affairs Minister Marcelo Ebrard and Labor Minister Luisa María Alcalde Luján, he said.
While there, Brady said he suggested putting forward “not just a one-year budget but a four-or five-year budget framework so that there is a comfort level that they’re making the commitment and resources to implement this."
Canada has also committed to seeing labor reform through in Mexico. The two sides launched a working group in August. Their first meeting began on Wednesday and will continue this week in Mexico where a “broad range of topics are being discussed,” a Canadian labor official told Inside U.S. Trade.
Seade said he met with Lighthizer on Thursday “to try to explain whatever needs to be explained, [and to] understand and collaborate.”
USTR’s counterproposal was not discussed with Lighthizer, Seade said, because “it’s premature."
“We’re waiting to see. Whatever outcome, we’re generally supportive,” Seade said. -- Maria Curi (mcuri@iwpnews.com)
