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Near-Unanimous Senate Approval, ‘Hopefully Soon,’ Predicted for USMCA
The Senate Finance Committee overwhelmingly approved one of President Trump’s top priorities – an updated free trade pact with Canada and Mexico – on Tuesday, with Democrats claiming a share of the credit in a trade victory for the president. U.S. agriculture would see modest increases in exports under the United States-Mexico-Canada Agreement, which maintains duty-free access for most farm exports to the U.S. neighbors.
“I look forward to a vote on the Senate floor for passage, hopefully soon,” said Finance Chairman Charles Grassley of Iowa after the committee cleared the bill on a 25-3 vote. He told reporters that he expected “near unanimous support” when the Senate votes on the bill to implement the USMCA. “If the articles of impeachment [against Trump] don’t come up, I would say by next week for sure,” said Grassley. If the Senate moves to an impeachment trial, “it could be the end of the month,” he said.
Canada and Mexico account for one third of U.S. food and agricultural trade and are the top two agricultural export markets, followed by Japan and China. President Trump and Chinese officials are expected to sign a Phase One agreement next week to de-escalate the Sino-U.S. trade war. Before the trade war, China was the top customer for farm exports. The trade war has cut into overall U.S. farm exports.
Representatives passed the USMCA bill, 385-41, on December 18. Mexico ratified the USMCA last summer. Canada is expected to take up the trinational agreement soon after the United States completes work. The House vote followed months of negotiations between the administration and House Democrats over refinements to labor, environment, pharmaceutical, and enforcement provisions. Senate Democrats, such as Sherrod Brown of Ohio, said they worked with House counterparts on the refinements.
Farm-state Republicans Steve Daines of Montana and Ben Sasse of Nebraska said the USMCA was a signal to trading partners that the United States is open for business. “What I’m hearing from Kansans is what we need to do is get this trade bill done,” said Senate Agriculture Chairman Pat Roberts, adding, “There’s a lot of trade cactus, trade tariff cactus, out there. I don’t think we need to sit on every (darn) one of them.”
While Republicans applauded Trump for the new North American pact, opening trade negotiations with Japan and challenging China’s trade practices, Oregon Senator Ron Wyden, the senior Democrat on the Finance Committee, said Trump’s trade policy of confrontation and tariffs “is driving away our traditional economic allies…Many foreign markets are more closed off to American exports today than they were on the day the president took office.”
Voting against the bill were two Republicans, Pat Toomey of Pennsylvania and Bill Cassidy of Louisiana, and one Democrat, Sheldon Whitehouse of Rhode Island. All other Finance Committee members voted for it.
The U.S. International Trade Commission has estimated the USMCA would increase annual U.S. food and agriculture exports by $2.2 billion, or 1%, when fully implemented. Dairy exports would rise with Canadian elimination of Class 6 and Class 7 milk-pricing systems that discourage U.S. dairy imports. Canada also would remove a discriminatory wheat-grading system that labels all U.S. wheat as low quality.
“The United States-Mexico-Canada Agreement will protect our valuable trade relationships with our nearest neighbors and return certainty to our markets,” said President Zippy Duvall of the American Farm Bureau Federation. Most U.S. farm groups supported the USMCA.
At least three other Senate committees have jurisdiction over the USMCA bill so it could take a couple of days for them to waive a review, which would allow a Senate vote, said Grassley.
To watch a video of the Finance Committee hearing or to read statements by Grassley and Wyden, text of the USMCA bill, and supporting documents, click here.