White House, Democrats edge closer to deal on trade

President Trump and House Democrats appear to be closing in on a deal to approve a new North American trade agreement, which would set up a major legislative victory for both sides. 

AFL-CIO President Richard Trumka briefed his labor confederation’s executive committee on the emerging deal Monday, while U.S. Trade Representative Robert Lighthizer and White House senior adviser Jared Kushner were reportedly set to travel to Mexico.

The trip suggests a last-minute move by Kushner and Lighthizer to get a final stamp of approval on the deal from Mexico.

A senior House Democratic aide urged caution on Monday, telling The Hill that the caucus is “still studying the proposal” to approve Trump’s U.S.-Mexico-Canada Agreement (USMCA).

But the fast-moving events suggested that the White House and Speaker Nancy Pelosi (D-Calif.) were edging closer to an agreement that would make sense for both sides even as they battle over the House’s march toward impeaching Trump.

Passage of the deal would fulfill Trump’s pledge to revamp the North American Free Trade Agreement (NAFTA), which cost thousands of U.S. manufacturing jobs. It could also bolster Trump’s support in industrial states crucial to his electoral coalition.

“I hear they’re doing very well on USMCA,” Trump said Monday to reporters at the White House, explaining that “a lot of strides have been made over the last 24 hours with unions and others.”

“I’m hearing from unions and others that it’s looking good, and I hope they put it up to a vote,” Trump continued. “If they put it up to a vote, it’s going to pass. A lot of Democrats want to pass it too, and we look forward to that.”

The support of the AFL-CIO could help win over skeptical Democrats and line up a vote on final passage before the end of the year. An agreement on USMCA could prompt the House Ways and Means Committee to hold a hearing on the deal as soon as this week, according to a senior Democratic aide.

Pelosi is under pressure from moderates to secure a USMCA agreement to give her vulnerable colleagues political cover from an impeachment backlash in 2020. 

Republicans were hammering Democrats at Monday’s Judiciary Committee hearing over their focus on impeachment; a deal on the USMCA would give Democrats something useful to point toward.

Democrats have been determined to prove that they can legislate as the caucus prepares to impeach Trump as early as next week. Lawmakers have pointed to dozens of bills that have been passed by the House but are sitting in the Senate. The USMCA would almost certainly be considered in the GOP Senate.

If the two sides do reach a deal just before Christmas, it is unclear if the House will move quickly toward a vote. Doing so would require deft maneuvering as lawmakers scramble to avert a government shutdown and the House tees up articles of impeachment.

Pelosi has insisted that impeachment would not affect efforts to strike a deal on USMCA, and that the party has been on “a path to yes” since talks began last year. Several Trump administration officials and GOP lawmakers have also expressed confidence that both sides could reach a deal on USMCA before the end of the year.

“I’m not going to speculate on what happens if you don’t pass it, because I’m highly encouraged you will,” Treasury Secretary Steven Mnuchin told House lawmakers during a Thursday hearing. 

The emerging deal is poised to be one of the most progressive trade agreements ever negotiated, and an endorsement by the AFL-CIO would give it an important stamp of approval.

House Democrats have worked closely with the AFL-CIO and its allies to bolster the trade deal’s enforcement of labor laws, a major issue for U.S. unions with NAFTA. Democratic support for USMCA will rest largely on whether the AFL-CIO and other labor groups support or oppose the trade pact.

“I’ll see if I can be switched from ‘no’ to ‘yes,’ ” Rep. Bill Pascrell (D-N.J.), a member of the House Ways and Means Subcommittee on Trade and close union ally, said late last week when asked about the USMCA.

Mexico’s agreement to any last-minute changes could be critical.

“We don’t have very much confidence in that the government of Mexico can fulfill what we’re going to be putting in this trade bill,” Pascrell said last week.

Lighthizer and his Mexican counterpart, Jesús Seade, reached an agreement late Friday on steel origin rules and labor inspection requirements needed to secure the support of U.S. labor groups, Bloomberg News reported.

Additional limits on steel sourcing and enhanced labor inspections could represent political challenges for Mexican officials. But Mexican President Andrés Manuel López Obrador said Monday that senators have already approved adjustments to the deal and urged the U.S. to act.

“It’s time, it’s the moment,” López Obrador said during a Monday press conference, according to Reuters. “We think we have already defined the terms in which we can ratify the agreement.”

Brett Samuels, Niv Elis and Rafael Bernal contributed.