- The House passes the United States-Mexico-Canada Agreement, President Donald Trump’s replacement for NAFTA.
- The chamber approves the agreement after more than a year of talks, during which Democrats sought tougher enforcement tools for labor standards.
- The agreement goes to the Senate, which is expected to approve it next year.
The House passed a new North American trade deal on Thursday, ending a more than year long slog to iron out Democratic concerns about the agreement.
The chamber approved the United States-Mexico-Canada Agreement, one of President Donald Trump’s economic and political priorities, in an overwhelming 385-41 vote. Thirty-eight Democrats opposed it. The trade pact now heads to the Senate, which is expected to ratify it next year.
Most Republicans and Democrats have praised the latest version of the three-nation deal, which replaces the North American Free Trade Agreement. GOP lawmakers and key business groups said it will follow through on Trump’s promise to refresh NAFTA — though they have criticized concessions to the Democratic-held House on intellectual property standards.
“This is the first-ever trade coalition of workers, farmers, Republicans, Democrats, business and agriculture groups, organized labor and much more,” U.S. Trade Representative Robert Lighthizer said in a statement celebrating the vote.
Democrats cheered tools to boost enforcement of labor standards, saying they would deter companies from moving jobs to Mexico. Still, some lawmakers and unions have concerns the deal does not go far enough to stop American companies from outsourcing jobs.
USMCA tightens rules of origin for auto parts and requires a larger share of cars to be made by workers earning at least $16 per hour. It also increases access to Canadian dairy markets for American farmers and updates digital trade rules, among other provisions.
Canada and Mexico are the largest U.S. export markets.
Even before the House passed the agreement, Trump started to bill it as a political win as he campaigns for reelection in 2020. Democrats also wanted to show they can work with Trump only a day after they voted to make him the third president impeached in American history.
“This vote today is a reminder that, even while the House was working to hold the President accountable for his abuses of office, we were still working hard to deliver on our promises to the American people to focus on economic opportunity,” House Majority Leader Steny Hoyer, D-Md., said ahead of the vote.
Speaking to reporters Thursday only hours after the impeachment vote, House Speaker Nancy Pelosi aimed to move focus away from the chamber charging Trump with abuse of power and obstruction of Congress. She cheered the trade deal and said it took time because “we weren’t going forward until we had the strongest possible enforcement.”
After a point in a news conference, Pelosi said she would not take any more questions about impeachment.
“Anybody care about that? Jobs for the American people?” she asked.
After Democrats pushed for tougher labor enforcement mechanisms, the key labor group AFL-CIO gave the deal its blessing. But at least one major union — the United Food and Commercial Workers International Union — said the bill did not do enough to protect food workers from “unfair competition from foreign companies not playing by the same rules.”
Major business groups largely backed the revised USMCA agreement as companies sought market certainty amid Trump’s trade war with China. While the U.S. Chamber of Commerce has pushed for the deal’s ratification, it took issue with the Trump administration removing a provision that protected makers of so-called biologic drugs from generic competitors for at least 10 years.
Democrats pushed to remove that measure, saying it would increase drug costs for consumers.
The GOP-held Senate is also expected to pass USMCA with bipartisan support. It is unclear when exactly the chamber will ratify the agreement, as the Senate will likely hold a trial on whether to remove Trump from office early next year.
The deal will not take effect until all three countries ratify it. The Mexican Senate has approved USMCA.
Republicans have used the deal as a political tool for months, arguing Democrats focused on impeaching Trump rather than replacing NAFTA. Democrats in districts reliant on trade with America’s northern and southern neighbors now aim to put pressure on Senate Majority Leader Mitch McConnell to ratify USMCA.
In a statement following the House vote, Senate Finance Committee Chairman Chuck Grassley, R-Iowa, said the Senate would not ratify the agreement in 2019.
“Impeaching the president and passing USMCA in the same week makes immediate action impossible. But I look forward to getting USMCA passed in the Senate and ratified early next year,” he said.
This story was originally written by Jacob Pramuk at CNBC.com.
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