Trump said he’s “ending” NAFTA and replacing it with the “largest trade deal ever made.”
The reality is that Trump cannot unilaterally end NAFTA in a constant lying, we now expect from a president who doesn’t understand treaties or could care less about telling the truth.
The fact that NAFTA didn’t address major industries that struggled to existed in the 1990’s it also left out new technologies but additionally ignoring labor and environmental standards.
The Trans-Pacific Partnership negotiated by Obama ultimately addressed these pending NAFTA issues. “The 12-country trade pact included Canada and Mexico among its signatories, it contained detailed language modernizing trade rules including information technology and raising labor and environmental standards. Nevertheless, one of Trump’s first acts was to inexplicably to pull out of TPP perhaps because he had not been involved in the negotiations that Obama had completed. Moreover Trump has now declared war on world trade by imposing tariffs on our allies as well as the Chinese with a consequent damage not only to foreign policy but also harming US businesses.
The fact is that there is still no signed Mexico deal which must also include Canada under the original agreement ratified by Congress which makes NAFTA implementation by statue and that does not give Trump the authority to separate the agreement in two parts.
Trump believes that negotiating bilateral agreements gives him the edge because of the size and power of the US economy thus being able to bully the weaker side and extract concessions, however he is learning that legislative restrictions won’t allow him to play dirty. The bottom line is that no matter what Trump says or wants to do most of NAFTA’s provisions will be active unless Congress passes a new trade law.
Besides, Congress is not the only deterrent to dumping NAFTA in favor of separate bilateral trade agreements. Canada and Mexico have each had to run the process through their respective legislator, therefore, any new trade agreement must involve all three countries. Mexican President Enrique Peña Nieto expressed during his telecom with Trump that he expected Canada to be part of any final agreement.
So, what is Trump talking about hammering “the best trade agreement ever made.”
Based on the scarce details these new requirements more likely than not require enlargement of the administrative state which will result in higher cost of cars and perhaps reduce the number of cars assembled in North America resulting in a negative effect of unintended consequences.
Apparently Trump is a slow learner for he should know by now that he is better served by telling the truth rather than lying and then getting caught on the lie. He did not negotiate a new trade agreement for he has no authority to do so and all three countries must agree to any modifications of the agreement!