On Senate Floor, Portman Highlights the Economic Benefits of the US-Mexico-Canada Trade Agreement


Portman Says the USMCA Will Help American Workers, Farmers & Manufacturers


July 16, 2019 | Press Releases

WASHINGTON, DC – Today on the Senate floor, U.S. Senator Rob Portman (R-OH) participated in a colloquy led by Senator John Hoeven (R-ND) to highlight the economic benefits of the U.S.-Mexico-Canada (USMCA) Trade Agreement, which will help American workers, farmers and manufacturers. Portman supports the more modern USMCA to the 25-year-old North American Free Trade Agreement (NAFTA) in part because it includes new and enforceable environmental and labor standards, a new section on digital trade, expanded opportunities for agricultural trade, and new opportunities for auto jobs in America.

A transcript of his remarks is below and a video can be found here:

 

“Thank you to my colleague from North Dakota, North Dakota farmers and manufacturers because he’s got a lot of manufacturing in his state as well. They’ve never had a better friend. That’s why he’s so strongly supportive of this agreement because it makes a big difference.

“My colleague from Arkansas just talked about the fact that in Arkansas, their two largest trading partners are Canada and Mexico. Same with Ohio. China is actually kind of a distant third. These two countries are critical for our exports. That’s why this agreement is so important.

“I’m a former trade lawyer. I also was the U.S. Trade Representative under George W. Bush and now I’m on the Senate Finance Committee which is the committee that handles these trade issues. I have to tell you, I think having a balanced and healthy trade relationship is really important. We have to stand up for our country and enforce these agreements that we have. But we also need to expand the exports because that’s what creates jobs -- by the way, better paying jobs. They pay about 16 percent more on average, better benefits. That’s why we need to be sure we have agreements like this one.

“We’ve got about five percent of the world’s population and about 25 percent of the world’s economy. We need to sell our stuff overseas. It gives us access to the 95 percent of the consumers who live outside of our borders. Mexico and Canada, as I said, are our biggest trading partners -- 39 percent of our exports go to Canada alone. That’s twice the national average. All in all, Mexico and Canada now support more than 12 million jobs nationally. That’s according to the U.S. Chamber of Commerce, 12 million jobs.

“We all know the existing agreement, this NAFTA agreement, North American Free Trade Agreement, has to be updated. It’s now 25 years old and it looks like it. It doesn’t have a lot of things you would expect in any modern agreement, like taking care of the digital economy. So much of our economy is over the internet and yet there’s nothing in [NAFTA] that deals with that part of our economy. It’s more than just a name change. It does include a lot of different aspects that we put in more modern agreements that we don’t have in the NAFTA agreement. Another one is labor and environmental standards. Not only are the standards stronger, but they’re enforceable under this new agreement. They are not enforceable under NAFTA.

“Auto jobs left the United States of America over the last 25 years. And one reason that this agreement is necessary is that the USMCA shifts more auto production back to the United States. My colleague from North Dakota talked about the manufacturing side. This is going to get United States automobile assembly lines humming again. Why? Because car parts and cars, if you want to get the better tariff treatment under the USMCA, they have to have higher content from North America. That means from us. So under NAFTA, the requirement was 62.5 percent. Under USMCA it’s 75 percent. By the way, there’s a new provision that says 70 percent of the steel that’s used in these automobiles has to be North American steel. Both of these things help to ensure we’ll have more manufacturing jobs in Ohio and around the country.

“American farmers, as we heard earlier, are going to gain access to markets in Canada and Mexico. That’s why Ohio farm groups are for this. That’s why, by the way, nearly 1,000 farm groups around the country now -- I didn’t know there were a thousand farm groups -- have come out to support this agreement. Small businesses in Ohio and around the country whose bottom line relies on these internet sales, internet commerce are going to have much more access to Canada and Mexico thanks to these new digital economy provisions. So it kind of helps across the board.

“By the way, these stronger labor standards in Mexico we talked about are going to help level the playing field in terms of labor, because labor costs are less in Mexico, right? But it goes even further than that. It actually requires that 40 percent to 45 percent of a USMCA vehicle made in Mexico or anywhere in North America must be produced by workers making at least $16 an hour. This is kind of revolutionary. It’s a different kind of thinking in a trade agreement. Frankly, it’s something you would expect from a Democrat administration to put in an agreement, but it’s in there, and it’s going to help auto workers here in this country. Because of all these changes I have discussed -- by the way, many of which like the higher minimum wage or like the higher domestic content -- have been advocated for by Democrats in the past. That’s been their approach to these trade agreements, not Republicans so much. But because of these provisions being so good for workers, I must tell you I am surprised, even amazed to see so many of my Democratic colleagues not stand up to support this agreement, because it has all these things that they said that they have wanted over the years, and they certainly don’t like NAFTA.

“Many of them have campaigned against NAFTA for the past 25 years. In a way, if you vote against USMCA, you know what you’re stuck with -- NAFTA. So in a way you’re voting for NAFTA if you vote against USMCA. That’s the alternative here. It’s a binary choice as they say. It’s either you’re for this new agreement that’s an improvement or you go back to the status quo, which is NAFTA. So it will be interesting to see, but my hope is that the media and others, outside groups, will hold people accountable and say why would you be against an agreement that’s better, even if it’s not perfect, from your point of view. By the way, no trade agreement is absolutely perfect. Every one of us would negotiate something slightly different. It’s a question of trying to make sure you don’t make the agreement, which is not perfect, the enemy of the good. And the good is to go to this new agreement.

“There was an outside independent study done by the International Trade Commission showing that 176,000 new jobs will be added to the U.S. economy just from this agreement alone. So this is better. So the bottom line, do we continue under the outdated NAFTA or do we adopt these new USMCA standards that will allow us to compete better in the global 21st century economy? A vote against USMCA again is a vote for the status quo. Without enforceable labor and environmental standards, with a non-existent digital economy provision, and with outdated rules of origin that allow more automobiles and auto parts to be manufactured overseas instead of here in America. USMCA addresses and solves all those problems.

“I put together a little handy chart here to talk about some of these specific provisions. USMCA creates 176,000 new jobs. NAFTA, none. Enforceable labor and environmental standards, USMCA, yes, check mark. Enforceable under NAFTA? No. Rules for the internet economy. New rules again to help small businesses’ internet economy. Check mark. NAFTA, no. Seventy percent of the steel in vehicles have to be made in North America. That’s a new provision. Not in any other trade agreement, by the way. Yes on USMCA, no on NAFTA. Finally, 40 percent to 45 percent of the vehicles must be made by workers earning at least $16 an hour. NAFTA, no. USMCA, yes. So, I mean, it’s pretty clear to me if you actually are honest about this and you look at it objectively and you say here are the two opportunities, which way would you go?

“So I hope my colleagues on the other side of the aisle take a look at this and apply logic and say, ‘You know, it might not be perfect, I might have wanted a little more here or there,’ but be sure that you’re supporting what works for your workers. If we can get this agreement passed, the president will sign it, it will make a difference for employees, for farmers, workers, service providers in my home state of Ohio and around the country.”

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