NAFTA 2.0 signed, but not sealed and delivered
In October, while comment- ing on the new trade agreement reached by the United States, Mexico and Canada, we wondered if the so-called NAFTA 2.0 could be the savior of the General Motors Lordstown assembly plant.
Last Monday, GM responded with a resounding “no” with its announcement that production of the Chevrolet Cruze at the Lordstown complex will end in March. The company did not identify another product to replace the Cruze.
Thus the question: When President Donald J. Trump says the United States-Mexico-Canada Agreement, or USMCA, is “a truly groundbreaking achievement,” did he expect that a 52-year-old American car plant would be mothballed and a facility in Mexico expanded?
The signing of USMCA by Trump, Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau took place last week in Argentina during the G-20 summit.
Trump, who made the renegotiation of North American Free Trade Agreement a centerpiece of his 2016 presidential campaign despite the Republican Party’s unwavering embrace of the 24-year-old pact, expressed confidence that Congress would approve NAFTA 2.0 without hesitation.
“It’s been so well-reviewed, I don’t expect to have very much of a problem,” the president said after the signing.
But as we pointed out in our October editorial when he wondered about the impact of the agreement on the Lordstown assembly complex, the devil is in the details.
It’s now up to Congress to go over each provision with a magnifying glass to determine if there’s a basis for Trump’s contention that the U.S. will benefit greatly and that American workers will no longer be at a disadvantage because of stricter workplace and environmental rules.
Last week’s decision by GM to mothball five factories – four in the U.S. and one in Canada – and to lay off 14,000 employees will loom large over the congressional hearings on the USMCA.
“I’ve said all along our No.1 priority has to be preventing American jobs from moving to Mexico,” U.S. Sen. Sherrod Brown, D-Ohio, a long-time opponent of NAFTA, said after the signing of USMCA. “Decades of devastation caused by NAFTA and GM’s recent layoffs underscore what’s at stake for American workers. This is too important not to get right, and that’s why I am committed to continuing to fight to strengthen anti-outsourcing rules in the agreement.”
While Brown can be counted on to lead the discussion in the Senate, the fact remains that with Republicans now in the majority – and increasing their numbers next year – President Trump may be able to exert political pressure to win approval.
The House of Representatives is another story. While Republicans are now in control, Democrats will be in the majority next year, which means the Republican president will be forced to jusfity NAFTA 2.0.
Mahoning Valley Congressman Tim Ryan of Howland, D-13th, shares Brown’s opinion that the the original trade agreement between the U.S., Mexico and Canada has been bad for American workers. It has devastated communities and wiped out this country’s manufacturing base, Ryan contends.
“That’s why I’ve been fighting to replace NAFTA with a fair deal since I was first elected to Congress,” Ryan said. “I am pleased that the text of the renegotiated NAFTA makes great strides toward prioritizing workers.”
But while the new and improved trade pact prioritizes workers, enforcement of the provisions must be a priority. Otherwise, NAFTA 2.0 is worthless.
Last week’s announcement by GM Chairwoman and CEO Mary Barra that the Lordstown plant would be idled in March has intensified the debate in this region over the company’s decision to build the new and improved iconic Chevrolet Blazer in Mexico.
Barra met with Sens. Brown and Portman and Reps. Ryan and Johnson in Washington on Wednesday to talk about the announced idling of the Lordstown plant. There were no details of what was discussed as this editorial was being written.
But here’s a question that should to be asked of Barra and other GM executives: Was the decision to build the Chevrolet Blazer in Mexico made after the federal bailout of GM and Chrysler by Democratic President Barack Obama and Democrats in Congress?