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Vice President Pence Demands Passage of USMCA This Year

Billions of dollars of U.S. ag trade on the line.

WAUKEE, Iowa -- U.S. Vice-President Mike Pence stopped in Iowa Wednesday to promote the passage of the USMCA trade agreement.

It’s a trade pact between the U.S., Canada, and Mexico that has bipartisan support in Congress, yet it is blocked by House Majority Leader Nancy Pelosi.

U.S. Trade Representative Robert Lighthizer, with the support of President Donald Trump, successfully renegotiated the North American Free Trade Agreement (NAFTA) resulting in the creation of the USMCA.

Critics of the agreement worry that the terms don’t sufficiently protect U.S. labor provisions.

Specifically, if Mexico fails to follow through with the USMCA labor laws, U.S. factories could be forced to close and those jobs would end up in Mexico.

Vice President Mike Pence challenged Iowa farmers, here, to press their members of Congress to get the USMCA passed.

“Turn up the heat on them and tell them to pass the USMCA, this year! Call these people,” Pence says.

Pence added, “Keep in mind that every single Democrat running for president is against the USMCA.”

The vice president told the Iowa crowd that USMCA could produce an immediate 175,000 jobs. Added to that, $2.0 billion worth of agriculture exports will be created by the trade agreement.

“So, Iowa farmers have the most to benefit from this USMCA,” Pence says. “Here in Iowa, $6.6 billion worth of goods are already being shipped to Canada and Mexico each year. That’s why your governor, your senators, and President Trump are demanding that Congress pass the USMCA and this year.”

Iowa Farmers listen to Vice-President Mike Pence
Mike McGinnis

Latest USMCA Developments

House Democrats, who have worked with U.S. trade representative Robert Lighthizer, want stronger language on labor, environment, pharmaceuticals, and enforcement provisions for the USMCA.

Speaker Nancy Pelosi said last week, “We’re on the path to yes.” But there is speculation that the impeachment inquiry may dominate House action in coming weeks and push the trilateral trade pact to the sideline. Farm groups, as well as business interests and the the Trump administration, have pressed since early summer for a vote in the House.

“It’s very important it gets done before the end of the year,” said Senate Finance chairman Chuck Grassley on Wednesday. “Next year, by golly, is an election year,” when legislation traditionally slows down. “Time is ticking.”

Chairman Richard Neal of the House Ways and Means Committee and four other Democrats met Mexican President Andres Manuel Lopez Obrador on Tuesday to discuss Mexico’s ability to follow through on promises made in USMCA. “The United States needs to see those assurances put into action,” said Neal, Massachusetts Democrat, afterward. “I appreciate today’s positive engagement and am eager to see Mexico demonstrate its commitment to implementing the changes necessary to realize its own vision for reform and meet the demanding labor and enforcement standards that will be required by the renegotiated NAFTA.”

The Mexican Senate ratified USMCA on June 19. Canada will hold parliamentary elections on October 21 and says it will act on USMCA as soon as the U.S. does.

Under the Constitution, the House must vote first on USMCA because it modifies tariffs and thus is considered a tax bill.

Analysts say the USMCA would result in a modest increase in ag trade with Canada and Mexico, who account for one third of U.S. food and agriculture trade. The pact would preserve duty-free access for most U.S. farm exports to the North American neighbors.

Farmers React

Dick Godfrey, a southwest Iowa farmer, in attendance at the Pence visit to Iowa, says that trade is imperative for his business.

“We need trade, and why not trade with the two closest neighbors that we have,” Godfrey, a Henderson, Iowa, grain and livestock producer says.

Godfrey added, “We need better trade policies. USMCA is very important. In the cattle business, it’s very important. It adds $70.00 per head in just the Mexico and Canadian markets. So, why not come here and support that.”

Despite the slog through the trade war, Godfrey remains supportive of the Trump administration.
“The endgame is right. It’s just going to hurt between now and then.”

Godfrey, a member of the Iowa Cattleman’s Association, says the industry thought that USMCA would be the blueprint to get something done with Japan.

“Well, now the Japan agreement is final, so let’s use that to get the USMCA ratified,” Godfrey says.

Larry Schneider, a retired Waukee, Iowa, farmer, says that he came out to the vice president Pence visit as an attempt to keep President Trump going.

“After the recent trade developments with Japan and China returning to buying U.S. soybeans, I’m liking what I’m seeing,” Schneider says.

When asked if he is tiring of the trade wars, Schneider said that farmers are proving to be resilient.

“Farmers have been farmers for years. It seems like the ups and downs work themselves out. As long as we have each other to lean on, deals will get done.”

Without sounding like a politician, the Iowa farmer said there are so many things that this country needs to get done.

“I’m a diabetic. I need my prescriptions to get brought into line. I need my insurance to get back into line. Different things need to happen. We don’t need these politicians fighting all of the time,” Schneider says.

Ag Secretaries’ Letter To Congress

In September, the past seven USDA Secretaries sent a letter to Congress in support of passage of USMCA.

“With Canada and Mexico being the first and second largest export markets for U.S. agricultural products, we believe USMCA makes positive improvements to one of our most critical trade deals,” the ag secretaries stated in the letter.

Currently, NAFTA supports more than 900,000 jobs in the U.S. food and agriculture sector and has boosted ag exports to Mexico and Canada to $40 billion this past year, the ag secretaries stated.

Before NAFTA went into effect in 1994, the U.S. exported only $9 billion worth of agricultural products to Canada and Mexico.

In addition, the International Trade Commission’s recent economic analysis concluded that USMCA would benefit the U.S. agricultural sector and would deliver an additional $2.2 billion in U.S. economic activity, the letter stated.  

“Trade is extremely vital to the livelihood of American farmers and the U.S. food industry. U.S. farm production exceeds domestic demand by 25%. In addition, agricultural exports account for 20% of farm income and support more than 1 million jobs,” the ag secretaries’ letter to Congressional leaders stated.


Chuck Abbott contributed to this article.

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