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THE BIG DEAL–Pelosi announces support for new Trump NAFTA deal: House Democrats on Tuesday announced an agreement with President Trump on a historic deal revamping the North American Free Trade Agreement (NAFTA) with Canada and Mexico, setting up a full vote as early as next week.
“This is a day we’ve all been working to and working for on the path to yes,” Speaker Nancy Pelosi (D-Calif.) said at a news conference to tout the deal that was held just an hour after she appeared before the cameras to announce two articles of impeachment against Trump.
- Pelosi said she hoped to pass the legislation before Christmas but would give time for Democrats to read and weigh in on the final negotiated deal, called the U.S.-Mexico-Canada Agreement (USMCA).
- But Senate Majority Leader Mitch McConnell (R-Ky.), who has pressed for Democrats in the House to take action, said his chamber will not take up the deal until after an impeachment trial.
The Hill’s Niv Elis and I tell you more about the road ahead here.
Why Trump wants it: Passage of the trade deal would provide a significant legislative win for Trump that might only be topped by his tax-cut bill, which was approved by a GOP-held House in 2017.
- Trump’s opposition to NAFTA was key to his 2016 victories in Ohio, Michigan, Wisconsin, and Pennsylvania–four industrial states where the deal cost thousands of manufacturing jobs.
- Successfully revising NAFTA could boost Trump’s standing in those states as the president attempts to reassemble his winning coalition in 2020.
Why Pelosi wants it: Pelosi is also casting the trade pact as a political win that shows her caucus can legislate even as they move toward just the third impeachment of a U.S. president in history.
- Republicans have sought to make the case that Democrats are obsessed only with impeachment, and they have frequently brought up the trade deal in that context.
- The Speaker also was careful to highlight changes to the originally negotiated text that helped win an endorsement from the AFL-CIO, and that underscored her argument that it was a win for progressives.
Reactions:
- “It is long overdue for Congress to take up the USMCA, and we expect to push hard on passing the implementing bill before the end of the year.” — White House press secretary Stephanie Grisham.
- “These were intense, argumentative, angry negotiations. I mean, this got hot on a number of occasions.”– Rep. Richard Neal (D-Mass.), chairman of the House Ways and Means Committee.
- “Trump was never for the strong labor enforcement rules and standards, so we had to pull him kicking and screaming.” — Sen. Sherrod Brown (D-Ohio).
- “There are serious problems with this agreement… it’s not going to do anything for economic growth.” –Sen. Pat Toomey (R-Pa.)
- “We haven’t seen the writing of how we’re going to stop the hemorrhaging of jobs to Mexico.” — Rep. Bill Pascrell (D-N.J.).
- “We should have done this a long time ago.” — Rep. Roger Williams (R-Texas).
What comes next: Trump is eager to pass USMCA before the end of the year, and House leaders are mulling ways to expedite the deal amid pending votes on impeachment and government funding.
They are still deliberating whether to use a fast-track process known as trade promotion authority (TPA), which has additional requirements, and whether to mark up the bill in committee.
But McConnell’s hesitance to take up USMCA until after impeachment could set up a fight with the White House, which insists on passing the deal before the end of the year.
Read more:
- Democrats declare victory for eliminating drug protections in trade deal
- Tech legal shield included in USMCA despite late Pelosi push
ON TAP TOMORROW:
- Secretary of Education Betsy DeVos testifies before the House Education and Labor Committee on the implementation of the borrower defense rule, 9 a.m.
LEADING THE DAY
Lawmakers push spending deadline to Thursday: Lawmakers broke up their meeting on Tuesday with no deal to fund the government as the clock ticked toward a Dec. 20 deadline.
Appropriators face a long series of obstacles to reach a deal and prevent either having to pass a short-term spending measure to keep the government open, or seeing federal agencies shut down.
House Appropriations Chairwoman Nita Lowey (D-N.Y.) and Senate Appropriations Chairman Richard Shelby (R-Ala.) had hoped to button up a deal by Sunday, and kept working into the week on a slew of tough issues that include President Trump’s proposed border wall, immigration enforcement, abortion-related issues, and Trump’s use of emergency powers to reprogram money toward the wall.
Niv Elis tells us more about what happened at the meeting here.
House panel to consider temporarily repealing SALT deduction cap: The House Ways and Means Committee is scheduled on Wednesday to consider legislation that would temporarily repeal a portion of Republicans’ 2017 tax-cut law, which is disliked by politicians in Democratic-leaning high-tax states.
The bill — offered by Reps. Tom Suozzi (D-N.Y.), Mike Thompson (D-Calif.) and Bill Pascrell (D-N.J.) — would repeal the $10,000 cap on the state and local tax (SALT) deduction for 2020 and 2021. It also would raise the cap to $20,000 for married couples in 2019.
- To offset the costs of the changes to the SALT deduction cap, the bill would raise the top individual income tax rate from 37 percent to its pre-GOP tax law level of 39.6 percent, and it would also lower the income threshold for where that top bracket starts.
- The proposed changes would be in effect from 2020 through 2025, after which time the individual tax changes in the 2017 law, including the SALT deduction cap, expire.
The Hill’s Naomi Jagoda has more here.
GOOD TO KNOW
- The New York Times: “A U.S. offensive against the World Trade Organization will effectively shutter the group’s system for settling disputes, at a time it’s most needed.”
- Progressive leaders in the House said Tuesday they are hoping to avoid a standoff with Democratic leaders following a meeting with Speaker Nancy Pelosi (D-Calif.) on her sweeping bill to lower drug prices.