Editorial: Pass USMCA trade deal before year's end

The Detroit News

The United States-Mexico-Canada Agreement (USMCA) is not a perfect trade deal for a number of reasons. But it's the best replacement for NAFTA that has been offered, and Congress should pass it.

House Speaker Nancy Pelosi said last week she had reached a deal with the White House and committed Democrats in her chamber to passage of the pact. That vote should be taken quickly and the bill sent to the Republican-controlled Senate, where, since it has the blessing of President Donald Trump, it should pass.

House Speaker Nancy Pelosi of Calif., accompanied by House Congress members speaks at a news conference to discuss the United States Mexico Canada Agreement (USMCA) trade agreement, Tuesday, Dec. 10, 2019, on Capitol Hill in Washington.

From the beginning, we have felt the deal Trump negotiated to replace the North American Free Trade Agreement was too rich in its labor demands, and in many cases would actually work against the goal of freer trade.

For the first time, the tri-country pact imposes what in effect is a minimum wage on another country in exchange for doing business with American manufacturers, demanding that 40% to 50% of auto content be made by workers paid at least $16 an hour. 

It also requires Mexico to pass legislation making it easier for labor unions there to organize workers.

But on the whole, the USMCA should benefit an American economy that craves certainty in trade policy. 

And it now twins with a limited deal between the U.S. and China to halt their trade war. Friday, Trump agreed to withdraw a threatened new round of tariffs on Chinese goods in exchange for promises by Beijing to purchase $50 billion more of American farm products.

China also has agreed to curtail its theft of intellectual property and its currency manipulation. That's a significant concession from a vital trading partner, but one that has not been trustworthy. 

And it's another sign that damaging trade wars may be coming to a close, with positive results. 

Under USMCA, many of the goods that enjoyed tariff-free trade continue to do so, while levies will go away for many new products, particularly in the agricultural sector. 

Protections on intellectual property rights have been strengthened. And the agreement updates NAFTA to more broadly cover digital commerce. 

Greater clarity of how the deal will be enforced and how violation claims will be adjudicated are also included.

USMCA has achieved the goal of improving and updating NAFTA, and does so in a way that should give American manufacturers more confidence in their interactions with Mexico and Canada.

President Donald Trump, Canada's Prime Minister Justin Trudeau, right,  and Mexico's President Enrique Pena Nieto, left, participate in the USMCA signing ceremony, Friday, Nov. 30, 2018 in Buenos Aires, Argentina.

Getting congressional approval has been a long pull. But additional changes to labor provisions brought the manufacturing unions aboard, and they brought with them the Democratic votes necessary to win passage.

Trade certainty promises to strengthen and extend what already has been a remarkable economic recovery.

Congress should not risk letting the deal sit. Debate it, approve it and pass it on to the president for his signature.