Battle brewing on Capitol Hill over new trade agreement

President Trump has repeatedly praised the United States Mexico Canada Agreement, often touting the trade deal as one of his administration’s major accomplishments.

But the trade deal to replace the North American Free Trade Agreement is not yet a sure thing. Lawmakers in all three countries need to ratify the deal.

This week Trump has threatened to impose 25% tariffs on Mexican cars or close the border if the country does not crack down on migrants and drugs entering the United States.

The president acknowledged concerns about what the move would mean for USMCA on Friday morning.

“This will supersede USMCA. USMCA is a great deal and it’s very good for Mexico, but this will supersede USMCA,” he said.

Plus, some lawmakers — including Senate Finance Chairman Chuck Grassley (R-IA) — worry Canada won’t approve the deal if the U.S. does not lift tariffs on steel and aluminum.

“We’ve gotta get rid of the tariffs or nothing’s going to happen,” said Grassley. “You gotta get something done in Canada before June, or they’re going to adjourn and you’re not going to get anything until after their election -- then how do you know what you’re going to get? You don’t have an agreement if you don’t get all three countries.”

The trade deal also faces an uncertain future in the U.S. House of Representatives.

Democratic lawmakers have raised concerns about labor, environmental and enforcement provisions in the trade agreement. House Speaker Nancy Pelosi told Politico before the House takes action, she wants to see Mexico pass and implement labor law reforms.

“I’ll tell you one thing. It’s a great deal. If they don’t pass it, it’s purely political,” Trump said on Thursday.

United States Trade Representative Robert Lighthizer is consistently talking to lawmakers to address their concerns and answer questions about the deal.

‘I don’t know of a day that goes by that I’m not working on USCMA’

At a US Chamber of Commerce event this week, the National Economic Council director, Larry Kudlow, urged the business community to help the administration get the deal across the finish line.

“I believe USMCA will contribute to growth,” said Kudlow.

Business groups have already been working to convince lawmakers to support the deal.

The Business Roundtable has called on Congress to approve USMCA before the end of the year. The US Chamber of Commerce announced the USMCA Coalition, made up of more than 200 businesses and associations, to advocate for the trade deal.

The Pass USCMA Coalition also launched earlier this year, with the sole goal of pushing for USMCA passage.

“We see ourselves complementing the other folks that are out there,” said Rick Dearborn, the Pass USMCA executive director.

Dearborn previously served as deputy chief of staff to President Trump. Former Democratic Congressman Joe Crowley, and former Commerce Secretary Gary Locke serve as co-chairs of the coalition.

Pass USMCA is made up of dozens of businesses, trade associations and advocacy groups -- including Dow, the National Association of Manufacturers, Dominos and the Small Business & Entrepreneurship Council.

In an interview with Yahoo Finance, Dearborn said the lobbying effort as “constant.”

“I don’t know of a day that goes by that I’m not working on USMCA,” said Dearborn.

Dearborn said his goal is to educate lawmakers — many of whom have never voted on a major trade deal.

“Going up on the Hill, trying to provide really good straightforward facts and figures and data about what the agreement means and what it’s going to mean for the workers back in their districts and state and the economy,” said Dearborn.

The Pass USMCA Coalition has also launched advertising campaigns in support of the deal.

‘Full fighting force of the North American labor movement’

While the business community rallies support for the deal, the USMCA faces opposition from labor groups.

"The fact that the business community is investing so much money in a campaign to get the new NAFTA ratified quickly and with minimal scrutiny says at least two things. First, that this deal isn’t a radical change from the current NAFTA. Second, they don’t want the deal’s flaws, including rules that favor Big Pharma and Big Data companies over working families, to become well-known,” said AFL-CIO trade specialist Celeste Drake, in a statement to Yahoo Finance.

Dearborn told Yahoo Finance he thinks the new trade agreement is good for organized labor.

“Whether you’re a union member or not, your options and your opportunity are exponentially greater underneath this deal,” said Dearborn.

The AFL-CIO disagrees.

AFL-CIO President Richard Trumka has threatened the “full fighting force of the North American labor movement” if the Trump administration does not add stronger labor and enforcement provisions to the deal.

“With the changes we are calling for, this deal has the potential to be an improvement over the original NAFTA. But if members of Congress bend to the will of these pro-USMCA coalitions, they will give away a historic chance to demonstrate that they stand with working families,” said Drake.