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House Democrats praise new trade deal to replace NAFTA amid impeachment

Getting the agreement through Congress would allow Trump to declare victory on a campaign promise ahead of the 2020 election.
Image: USMCA
"It will be the best and most important trade deal ever made by the USA," President Donald Trump tweeted before the Democrats' news conference to announce the USMCA agreement.Saul Loeb / AFP - Getty Images

WASHINGTON — Democratic leaders Tuesday praised a new trade deal to replace the decades-old North American Free Trade Agreement, which President Donald Trump and Democrats had frequently criticized.

House Speaker Nancy Pelosi, D-Calif., and Ways and Means Committee Chairman Richard Neal, D-Mass., said they were poised to move forward with the United States–Mexico–Canada Agreement (USMCA) less than an hour after Democratic leaders, including Pelosi, Neal and House Judiciary Chairman Jerry Nadler, D-N.Y., unveiled two articles of impeachment against the president accusing him of high crimes and misdemeanors.

"There is no question, of course, that this trade agreement is much better than NAFTA, but in terms of our work here, it is infinitely better than what was initially proposed by the administration," Pelosi said. "It's a victory for America's workers, it's one that we take great pride in advancing."

“It’s a win for the market as a whole. It’s definitely good for the U.S. economy,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.

Democrats sought to highlight their contributions to the deal — such as removing carveouts for pharmaceutical companies, among others, and barriers to generic medications — and how hard they’d worked on the deal to improve it from the White House’s first draft.

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“These were intense, argumentative, angry negotiations,” Neal said, joking that he and U.S. Trade Representative Robert Lighthizer set a record for hanging up on each other.

Getting the deal approved by Congress has been a top legislative priority for Trump, who pushed Democrats to sign off on it before the end of the year. Successful passage would give Trump a win ahead of his 2020 re-election bid and allow him to declare victory on a signature campaign promise to repeal the trade deal he railed against.

"It will be the best and most important trade deal ever made by the USA," he tweeted before the Democrats' news conference.

He later told reporters at the White House that Democrats had held the event to detract attention from their announcement of articles of impeachment just a short time earlier.

“They were very embarrassed by it. And that's why they brought up USMCA an hour after because they think it will muffle it a little bit," he said late Tuesday, as he left for a campaign rally in Hershey, Pennsylvania.

Democrats, who wanted the deal to include tougher enforcement of labor rules, could use the trade pact to show they can legislate even amid impeachment proceedings.

“This will be a big deal in the upper Midwest. For the Democrats to say OK to this must mean that they’re getting a pretty good deal, in their view,” said Michael O. Moore, professor of economics and international affairs at George Washington University. “This is the kind of compromise that used to be done in Washington where both sides could claim victory.”

"There's some people who say why make it look like he has a victory. Well, we’re declaring victory for the American worker,” Pelosi said, when asked about giving Trump a win on the same day as they announced impeachment articles.

Pelosi and administration officials have been going back and forth for weeks over changes Democratic lawmakers wanted to the language reached by representatives from the three countries.

The AFL-CIO announced its support of the new trade agreement Tuesday, a key endorsement for Democrats.

"For the first time, there truly will be enforceable labor standards — including a process that allows for the inspections of factories and facilities that are not living up to their obligations," the union's president, Richard Trumka, said in a statement.

“The AFL-CIO has complained for decades that labor, especially low cost labor, and not enforcing environmental rules has given Mexico an advantage,” Moore said. “We’re now moving into a stage where there are stronger commitments to core international labor organization standards.”

“The willingness on Pelosi’s side to go along with this seems to indicate it’s a wonderful precedent for the Democratic party to get a Republican administration to implement enforcement that’s acceptable to Democrats, including labor unions, to labor agreements,” said Jacob Kirkegaard, a senior fellow at the Peterson Institute for International Economics. “It’s a historic win.”

Democrats repeatedly thanked Trumka in their remarks, while Secretary of Commerce Wilbur Ross complained Tuesday morning that Democrats have held up the process to appease the labor leader.

"The remarkable thing is that it took so long to make such small changes insisted on by the Democrats," he said on Fox Business Network on Tuesday. "In effect, they gave Trumka, the leader of the union, veto power over the House of Representatives. That seems weird."

Despite the claims of victory on both sides, though, Zaccarelli said the China trade war — and the prospect of tariffs on $156 billion worth of primarily consumer goods — threatened to eclipse any market boost USMCA might have delivered.

“When you talk about trade, it’s all about U.S.-China negotiations. That’s the elephant in the room,” he said. “What happens on Sunday's deadline is critical.”

Shannon Pettypiece reported from Washington, and Jane C. Timm reported from New York.