Trump Administration Now Seeking More Modest Changes to NAFTA

Matt Posky
by Matt Posky
trump administration now seeking more modest changes to nafta

The Trump administration is changing its tune regarding the North American Free Trade Agreement.

Despite the president calling the pact the “worst deal” in history throughout his campaign and hinting his goal was to abandon the agreement, the White House intends to keep numerous provisions while seeking more moderate changes.

Among the more controversial arrangements Trump intends to keep are the arbitration panels that permit investors in the three nations to circumvent local courts to resolve civil claims. The administration even has a proposal that would improve these bodies’ procedures to resolve disputes.

Is this the bold trade overhaul that Trump promised on the campaign trail?

The White House is mainly seeking limited changes to NAFTA, The Wall Street Journal reported on Thursday, citing an administrative draft proposal circulated in Congress by the Office of the U.S. Trade Representative. Its new objectives would bolster Trump’s “American Made” focus, especially in regard to automotive manufacturing, by giving greater preference to U.S. companies in government procurement. However, it’s missing a lot of Trump’s bold rhetoric and the import tariffs promised for Mexico. The draft also doesn’t weigh in on labor regulations or currency manipulation — two things that Trump has previously said were mandatory to ensure a free-market.

White House Press Secretary Sean Spicer posited there would likely be substantial changes in the proposal after Trump’s nominee for U.S. trade representative, Robert Lighthizer, is confirmed by the Senate. Although, for now, it’s fairly conventional.

Trump’s level of direct involvement in the draft is unclear. While the president has limited some of his harsher words on trade since taking office, the draft only takes a slight American bend with other elements — like the arbitration panels — having a free-trade bias that some have called un-American and pro-business.

The eight-page draft letter also includes numerous objectives that were established by the Obama administration in completing the Trans-Pacific Partnership, including additions to digital trade provisions, state-owned enterprises, labor and environmental obligations, and intellectual property enforcement.

Some alterations are distinctive of the current administration, though.

The biggest changes favoring the Trump agenda include an expanded ability for the U.S. government to apply tariffs on goods from Mexico and Canada, but it only applies when there is a sudden influx of imports that might cause serious harm to a specific domestic industry.

Join the conversation
16 of 211 comments
  • Lou_BC Lou_BC on Apr 01, 2017

    "Trump Administration Now Seeking More Modest Changes to NAFTA" This is no surprise. Libertarian free market billionaires like the Koch brothers don't like the idea of an import tax. They also don't like the idea of anything that could restrict trade. They have gone as far as offering a million cash to reelection campaigns of any Repubs facing political heat. All of his bold populist campaign promises are going to crash upon the rocky shores of reality.

    • See 7 previous
    • Lou_BC Lou_BC on Apr 03, 2017

      Hummer - I'm not partisan, I just don't like #putinspotus. If I was American back in November 2008, I would have voted McCain. He is a true patriot that is bipartisan when that happens to be the best approach for his constituency. The guy has been in harms way and has suffered for his country. That is the kind of guy you need in office. My list are things twitterpotus campaigned to change that has not worked. He shot his mouth off without a plan. The guy is a reality star that only knows how and what to say to get the news/headlines and to play to his fan base. Reagan was a decent leader because as a "B" actor he knew well enough to follow the script and let the experts direct the movie. I have voted conservative or for conservative leaning parties in the past and would in the future. It all depends on the campaign platform and if they were already in power, what kind of job they did or if I agreed with their direction for the country.

  • OldWingGuy OldWingGuy on Apr 02, 2017

    @Hummer, @HDC, etc Full disclosure here - I'm Canadian, so don't have a dog in this hunt on American politics. But it seems to me that: President Clinton left the first, and only, surplus budget in a generation George Bush quickly cut taxes, mostly for the top 0.1% (See Ted Talk, Robert Kiyosaki, author of Rich Dad Poor Dad) President Bush had 9-11 on his watch, got embroiled in not one, but two, hopeless wars, stood by while New Orleans flooded, and had the entire world financial system melt down on his watch. President Obama was handed an incredible mess, worst recession since 1929, two hopeless wars. During his time, approx 14M jobs created (about 3500 per day), found Osama bin Ladden, dealt with a congress sworn to oppose everything, and brought some measure of health care to millions. And relatively scandal free. So, for an uninformed Canuck, just why is it folks despise President Obama so much. I don't get it. As to NAFTA, it was set up for cheap labour from Mexico and cheap resources from Canada, with the USA deriving most of the benefit. As a Canadian, OK with me to toss the whole thing out.

    • See 5 previous
    • Art Vandelay Art Vandelay on Apr 03, 2017

      @probert Checkov in the mail??? Is this a jeep joke?

  • Redapple2 C2 is the best. C3 next. Then C7 (looking at you jimII).
  • Jeff S Vulpine--True the CAFE rules are for ICE.
  • Gray I grew up in the era of Panther and Fox platforms. If only they developed a good looking two door Conti. The four doors became a cult in their own right. And kept the 351W as a top line option.
  • Vulpine ABSOLUTELY YES!!! Bring back the TRUE compact trucks. The demand for them is far higher than the OEMs want to admit.
  • Brn More likely, with Google having troubles, the money tree isn't as ripe as it once was and cutbacks are needed.I hope the overall industry continues to evolve. When I get the the point I can't easily drive, I would still appreciate the independence that autonomous vehicles can bring.