What if we crash out of NAFTA?
Los Angeles Times
“President Trump’s NAFTA 2.0 trade accord—the United States–Mexico-Canada Agreement—is in trouble,” said Peter Schechter, and the timing could be catastrophic. Republicans are signaling concern about trade restrictions in Trump’s pact, while Democrats insist that Mexico change its worker protection laws. Trump’s immigration rhetoric doesn’t help—it’s hard to pass a major trade agreement as the president “is threatening to completely shut down the border.” But if Congress rejects this revised agreement, or stalls until after 2020, Trump could “withdraw from the North American Free Trade Agreement without a backup plan.” Trade feuds with China and Europe have gotten more attention, but an implosion of the USMCA would amount to our version of Brexit. Ending NAFTA without a replacement “could eliminate 1.8 million to 3.6 million mostly blue-collar jobs in the next few years” in the U.S., while putting as many as 10 million Mexicans out of work—thus increasing pressure on the border. It would also hurt Trump’s deal-making credibility when he needs it most. The U.S. is closing in on a long-awaited agreement with China that could end that trade war. Failure to ratify an agreement with our close allies “will have inevitable negative consequences on the U.S.-China negotiations.” The USMCA isn’t perfect. But it’s a better stopgap than “a no-deal crash out.”