SO, we are being told that the Negotiator-in-Chief has renegotiated NAFTA with Mexico, and that Canada has been left out in the cold. President Trump has to be given credit for at least the appearance of keeping campaign promises, but the fine points in this "NAFTA replacement deal" do NOT seem to truly free the USA from the grips of the FREE TRAITORS. But the optics are good, and in politics, that is often what really matters.
Here is an article from the good folks at ZeroHedge with some of the details of the new bilateral agreement. All the details have not been totally ironed out, as you will see, and the devil is definitely in the details:
https://www.zerohedge.com/news/2018-08-27/big-deal-looking-good-us-mexico-agree-nafta-pact
Here is an excerpt I want to make further comment on:
"A key provision of the new deal is an increase in the mandated locally-sourced auto content from 62.5% to 75%, and that 40% to 45% of auto content would be made by workers earning average base wage of $16/hour. According to the US Trade Rep, the new rules will “incentivize billions annually” in additional U.S. vehicle and auto parts production” and help preserve and re-shore industry jobs and investment. The deal also maintains duty-free access in farm products, while the countries have also agreed to stronger rules-of-origin for industrial products such as chemicals, steel-intensive products, glass and optical fiber. A new “market access chapter” will address non-tariff barriers in re-manufactured goods along with import/export licensing. The US and Mexico also agreed to new language on the textile and apparel trade, which will promote greater use of American-made fibers, yarns and fabrics, and limit the use of non-Nafta inputs for the industry, per the USTR."
OK...so let's have a look at the above. "62.5% to 75%" is NOT getting rid of NAFTA. It's, IMHO, barely even tweaking NAFTA. And, whose "local" are we talking about...Mexico's or the USA's? The 40-45% thing is laughable too. What if all 45% are Mexicans..?...how would that benefit the USA, and it sure sounds like that regulation could be "worked around" in any number of ways. If the people of the USA can continue to get "duty-free access" to Mexican human-waste treated veggies, how does that benefit us, as the next sentence clearly leaves that all out of the new origin rules, so that we won't even know we're eating Mexican garbage. What does "non-tariff barriers in re-manufactured goods" even mean?? The last sentence is even less informative and troublesome..."greater use" could mean an additional ten cents per YEAR spent on American fibers, yarns and fabrics, and there may not be so much as an additional human hired in the USA based on that language, let alone a reinvigorating of our once dynamic Fiber/yarns/fabric industries.
And what about all the industries not even mentioned here? Is my home state of Maine going to get our dozens of shoe factories back, or our paper mills? I hate to be a downer here, but this trade agreement does not signal anything really positive for American workers as far as I can currently see based on the info we currently have. Much more needs to be released to the public about this deal, and soon. We can not let any President participate in what, on first blush, looks like a bait and switch deal, and then declare victory and then simply walk away.
What happens to Canada is of little concern to me, nor should it be to most Americans. The impact of the English colony to our north has to be considered, too, when it comes to automotive, farm and especially forest products. Tariffs MUST be part of the equation on that front, as there is no other way to realistically adjust NAFTA in that direction that can make up for the massive government incentives that Canadian farmers and loggers get that are not available to their American counterparts.
Let me tell you just a bit about that... living, as I do, right on the Canadian border. J.D. Irving, an enormous industrial conglomerate from New Brunswick literally owns about half of the land in northern Maine, and several of our railroads. They cut timber here in huge volumes and take it back to Canada for processing in THEIR lumber yards and THEIR paper mills, with no Mainers involved. They transport materials across Maine on wholly-owned (through subsidiaries) rails that simply transit our state without benefiting Maine people in any way...basically reversing the Webster-Ashburton Treaty. Their oil products are everywhere here competing with American oil refineries/retailers, without--so far as I can tell--any real benefit in overall pricing, as they participate in illegal collusion in almost every local market to align their prices closely to their American competitors. American potato farming (Northern Maine's previously second-largest economic unit, after forest products,) is waning HARD due to Canadian imports of potatoes grown on Prince Edward Island and New Brunswick, by farmers who are heavily and directly subsidized by The Crown. In other words, Canada needs to be slapped down HARD, also, if any new agreement is reached with them.
In fact, if President Trump does NOTHING on the Canadian NAFTA front, other than let it expire...that will be THE single great benefit to the whole NAFTA "renegotiation," and we can basically ignore the pittance we got on this reworked USA-Mexican bilateral deal.