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Home | Tag Archives: NAFTA (page 2)

Tag Archives: NAFTA

Texas Business Groups are Banding Together to Keep NAFTA Strong

Despite uncertainty on how the Trump administration will renegotiate the United States’ role in the North American Free Trade Agreement, two-way trade between Texas and Mexico has continued to flourish since the president was sworn in in January.

Now, a number of Texas-based business groups have teamed up to prevent a reversal in that trend by making sure the state has a seat at the table now that Trump has told Congress his administration would begin renegotiating the 23-year-old trade deal between the U.S., Mexico and Canada.

Representatives from the Texas Association of Business, the El Paso-based Borderplex Alliance and the Texas Business Leadership Council announced on Thursday the creation of the Texas-Mexico Trade Coalition, a binational group of business interests that seeks to keep Mexico Texas’ No. 1 trade partner.

Coalition members said time isn’t necessarily on their side if they want to preserve the benefits and job growth NAFTA has brought to Texas and beyond.

“The failure to act swiftly will push us into not only the midterm elections in the United States but also the presidential election in Mexico,” said Eddie Aldrete, senior vice president of the International Bank of Commerce and chairman of the coalition. “So we need to pass NAFTA on its own merits, on its own timeframe.”

Aldrete said that will include working to amend the current agreement instead of overhauling it completely.

Texas has more to lose than any other state on the country’s southern border if NAFTA is reworked in a way that decreases trade between the two countries. From January to April of this year, more than $178 billion in two-way trade has passed through ports in the United States and Mexico, according to WorldCity, a Florida-based economics think tank that uses U.S. Census data to track trade patterns. That figure represents a 4.5 percent increase compared to the same timeframe in 2016.

About $94 billion of 2017’s trade has passed through the Laredo customs district, with another $29.5 billion passing through the El Paso customs district. The ports of Houston and Port Arthur are also in included in Mexico’s top 10 trading partners, ranking fifth with $6 billion and eighth with $1.95 billion, respectively.

Jeff Moseley, the CEO of the Texas Association of Business, said revamping NAFTA only makes sense because of how much industry and commerce has changed since pact went into effect in 1994.

“The document, as it was pulled together 23 years ago, did not contemplate that we would have so much development in technology,” he said. “It didn’t contemplate that the Mexican Constitution would have been amended to allow for energy exploration. So there are new opportunities to bring forward.”

Moseley added he was reassured the federal government would listen to stakeholders on the ground after he met with U.S. Secretary of Commerce Wilbur Ross, who said he’d take a “do-no-harm” approach.

But business leaders are also careful not to assume the United States has complete control over the negotiations. Just last month, Mexican Secretary of Economy Ildefonso Guajardo said the country could look to expand trade with China if the United States insisted on trade policies that were not mutually beneficial, CNBC reported. The Mexican government could also explore expanding trade with South American countries as another option.

“It’s always a concern. It’s always out there as a potential threat to our economic interest in the United States,” Aldrete said of Guajardo’s comments. Asked if he thought if the Mexican secretary spoke more out of a sense of national pride, Aldrete said it didn’t matter.

“Whatever his motivation was, it certainly got the attention of a lot of people in the business community to then turn around and push our own administration to focus on the timeline and move quickly,” he said. “From a logistical standpoint, Mexico and the United States would prefer to do business with each other.”

Disclosure: The Texas Association of Business and Texas Business Leadership Council have been financial supporters of The Texas Tribune. A complete list of Tribune donors and sponsors is available here.

Read related Tribune coverage:

  • After a trial balloon went over poorly with Congress, Trump told foreign leaders he won’t end the trade agreement just yet. [link]
  • Despite all the time Donald Trump spent bashing NAFTA while running, border leaders hope he’ll soften his stance as campaign trail rhetoric cools. [link]

Author:  JULIÁN AGUILAR – The Texas Tribune

Cornyn, Hurd Issue Statements on NAFTA Renegotiation

U.S. Senator John Cornyn (R-TX) today released the following statement after the Administration notified Congress of its intent to renegotiate the North American Free Trade Agreement (NAFTA):

“NAFTA is vitally important to the state of Texas, with free trade adding billions of dollars to our economy annually,” Sen. Cornyn said. “We have a great opportunity to improve and modernize this landmark agreement. By updating NAFTA, we can address modern-day challenges without sacrificing economic prosperity.  I look forward to working with the President and community leaders in Texas to ensure any updates made are in the best interest of my state, and the many farmers, ranchers, and job creators whose livelihoods depend on this vital agreement.”


U.S. Representative Will Hurd released the following statement regarding the Administration’s notification to Congress of their intent to renegotiate the North American Free Trade Agreement:

“Trade is the lifeblood of many communities in my district, including El Paso, Del Rio and Eagle Pass. The U.S., Mexico and Canada are not competitors, but partners who build things together. It is now more important than ever that we strengthen our relationship as allies and partners, so we can work together to increase economic opportunities on both sides of the border,” said Congressman Will Hurd.

“I believe we have a real opportunity to modernize and improve North American Competitiveness in the rest of the world through an upgrade of the North American Free Trade Agreement (NAFTA). I look forward to working with my colleagues and counterparts to develop mutually beneficial policy that strengthens the economy and keeps Americans safe.”

Cornyn Op-Ed: Don’t End NAFTA. Fix It.

When looking for a model economy, Washington would be wise to look no further than Texas. The “great American jobs machine,” as we’re affectionately known, has been the economic engine that pulled our country out of the recent recession, singlehandedly adding more than one million jobs to the American economy. In fact, if Texas were its own country, we would be the 10th largest economy in the world.

Now, with pro-growth Republicans in control of Congress and the White House, leaders are beginning to consider proposals to lift our economy out of a sluggish recovery. But as we work together to jumpstart our factories and farms across the country, let’s keep in mind what my state has gotten right.

Trade has been a cornerstone of the Texas economy, with no partner more important than Mexico.

As our largest export market, Mexico has an extraordinary economic relationship with Texas. Trade with our southern neighbor supports hundreds of thousands of jobs in my state and provides more goods at a better price for Texas families. More than a third of all Texas merchandise is exported to Mexico – meaning our farmers, ranchers and small businesses have found no shortage of customers south of the border too.

This explosion in trade for our state has catapulted Texas to the top of exporting states in the country for more than a decade now. Thanks to trade pacts like the North American Free Trade Agreement (NAFTA), goods and services flow more freely among the three North American countries, growing jobs across Texas and stretching paychecks further. This isn’t just true for Texas. A majority of exports coming from Michigan and Ohio, for example, are bound for our NAFTA partners too.

Trade in Texas – specifically along our Southern border with Mexico – doesn’t just work in theory. It’s the reality on the ground too. Last week I led a congressional delegation to the border to see this economy in action. We visited the Pharr International Bridge in the Rio Grande Valley – a bridge that facilitates about $30 billion in trade a year. We also visited Laredo, a port that handles about a third of all international trade in Texas, with 14,000 trucks passing through daily. In other words, the Texas border serves as a major gateway for agriculture and manufactured goods trade. It moves more freight along its 1,200-plus miles of southern border than any other border state. And this trade in turn fuels economic growth and vitality across the region and the entire country.

But like anything that’s dated, there’s room for NAFTA to be improved. It’s now more than 20 years old. Texas and the United States as a whole would benefit from a revised agreement that makes trade freer and fairer. By fixing NAFTA, we can address modern-day challenges and preserve and protect America’s unrivaled stability and prosperity into the next century.

Consider the nation’s energy landscape. It has changed dramatically since the trade deal was hammered out in the 1990s. With the recent lifting of the U.S. crude oil export ban and Mexico’s energy reforms, a renegotiated deal should account for regulatory cooperation and capacity-building provisions that promote investment and the free flow of American energy, particularly a streamlined approval process for LNG exports. There’s room to bring the services trade into the 21st century, strengthen intellectual property rights and eliminate non-science barriers to trade, too.

As the administration and Congress look to improve existing trade deals, such as NAFTA, we would also be wise to focus on strengthening the Southern border. The president has made no secret of rightly prioritizing our country’s safety. Securing the border is an essential part of that equation.

But as we do, we must be quick to engage community leaders and business-owners along the border. Yes, they want security and protection. But they also know that key to the success of Texas and the nation has been the cultivation of an environment that can manage the demands of high-volume trade. That means keeping legitimate trade and travel flowing, while simultaneously screening criminal elements and contraband to keep them out. In other words, the border ecosystem demands a careful balance.

It’s our job to consider how to gain complete control of the border, while equipping our Customs and Border Patrol agents with the resources they need to keep our economy up and running. That way, everyone can benefit from access to markets on the other side.

Texas – where taxes are low, regulations are sensible and trade is encouraged – has proven time and again that we’re a blueprint for growing the national economy. In my state, border security, trade and the economy are intimately connected. So as Congress considers whether to revisit agreements like NAFTA and how to best secure the border, we must take great care to advocate for smart policies that drive growth here at home and enhance our partnerships abroad.

Senator John Cornyn, a Republican from Texas, is a member of the Senate Finance, Intelligence, and Judiciary Committees.  This column originally appeared in Politico Magazine and is reposted with permission.

UTEP Report: Trade Ambiguity Triggers Lower Mexico Economic Forecast

The potential disruption in trade relations between the U.S. and Mexico was among the reasons why economists who monitor Mexico’s business cycle developments have lowered their 2017 projections of gross domestic product, according to UTEP’s Border Region Modeling Project.

“The Trump Effect” is the title of the fourth quarter Mexico Consensus Economic Forecast that reports a GDP growth rate projection of 1.4 percent, 90 basis points lower than the 2.3 percent rate predicted in September 2016.

The projection includes a climb in the short-term 28-day treasury certificates (CETES) interest rate to 5.9 percent in 2017, while the nominal peso per dollar exchange rate will average P/$20.70 next year.

“Currency market erosion of the peso usually translates into greater direct foreign investment in maquiladora-related manufacturing in Ciudad Juárez,” said Tom Fullerton, Ph.D., director of the BRMP and professor of economics.

“It is not clear, however, that such a dynamic will materialize next year due to Trump administration suspicions about international trade impacts on the national economy. Any investments in export-oriented manufacturing in Ciudad Juárez are also accompanied by additional warehousing and transportation investments in El Paso,” Fullerton Added.

This quarterly report is published by the BRMP, a research unit within Department of Economics and Finance in the College of Business Administration at The University of Texas at El Paso.

The report synthesizes macroeconomic forecasts from nine prominent banks, universities and other U.S. and Mexican institutions.

Border Leaders think Trump’s Tough Talk on NAFTA will Die Down

Despite all the time Donald Trump spent bashing NAFTA while running, border leaders hope he’ll soften his stance as campaign trail rhetoric cools.

Keep calm and educate Donald Trump.

That seems to be the mantra border leaders are adopting after realizing that the candidate who promised to renegotiate — or even eliminate — the North American Free Trade Agreement will be the country’s next president.

The 1994 pact gradually eliminated most tariffs on several goods traded between Canada, Mexico and the United States. It’s turned cities like El Paso and Laredo into key trade hubs but also displaced thousands of jobs that went to workers in Mexico and other countries.

But once Trump’s advisers tell him the pact produces more for the American and world economies than it takes away, he’ll take a different tone, predicted U.S. Rep. Henry Cuellar, D-Laredo, whose district is home to the country’s largest inland port.

“Trump says he is a businessperson. Well, 90 percent of the Fortune 500 companies have investments in Mexico,” Cuellar said. “So as a businessperson I assume he’s going to listen to those 90 percent.”

From January to September of this year, the Laredo and El Paso customs districts have seen $203 billion and $71.3 billion in two-way trade with Mexico, respectively. Houston is the country’s fifth-busiest trade partner with Mexico, at about $11.3 billion during the same time frame, according to WorldCity, a Florida-based economics think tank that uses U.S. Census data to track trade patterns.

Cuellar said Trump’s campaign talk about NAFTA was more “bark than bite” — a lesson he said would be learned after being sworn in.

“That’s the danger when you run a campaign and you make certain promises that might be hard to keep,” Cuellar said. “That’s one of the reasons he won some of those states” like Pennsylvania, Ohio and Michigan.

Cuellar said that Trump isn’t the first candidate to tell supporters he would roll back trade pacts to earn support, with the most recent being President Obama.

“You see the world in a different way, it’s easier to campaign than to govern,” Cuellar said. He added that should Trump stay the course, it would be up to state leaders like Gov. Greg Abbott to remind Trump about the benefits NAFTA bestows upon Texas.

Abbott’s office, which regularly boasts about Texas’ business-friendly climate, didn’t respond to a request for comment for thistttt story.

Richard Dayoub, president and CEO of the Greater El Paso Chamber of Commerce, said Trump needs to realize that more than two dozen states are positively affected by NAFTA.

“Many, many states, 30 plus, do a billion dollars or more a year in trade with Mexico,” he said. “That means manufacturing jobs in the U.S., they rely on the consumers in Mexico, which he hasn’t thought about. So our job is to try to educate and inform and try to get him to look at things more pragmatically now that we are done with the election.”

Even if Trump can’t be convinced about the positive effects of NAFTA, Cuellar said, its future is not completely up to him. The future president would likely have to convince Congress to do away with the pact, which wouldn’t be an easy sell given that several Republicans support the measure.

He also said Mexico holds some sway. In 2011 when the United States had yet to fulfill a NAFTA provision to allow Mexican truckers to travel inland, Mexico slapped U.S. goods with retaliatory tariffs.

“We would be the No. 1 state that would be devastated by a trade war with Mexico,” he said.

Other Texans who hope to have Trump’s ear in the coming months think changing NAFTA is a good thing. Texas Agriculture Commissioner Sid Miller, who was part of the Trump campaign’s advisory council, said it makes sense after so many years.

This image shows tractor-trailer traffic from Mexico across the United States during a one-week period.TXDOT
This image shows tractor-trailer traffic from Mexico across the United States during a one-week period.TXDOT

“We don’t want to completely do away with NAFTA; there are some good things in there,” he said. “But that document is 22 years old. Trade routes have changed, technology has changed, markets have changed, economies have changed. Donald Trump is right: We don’t win anymore.”

Laredo Mayor Pete Saenz agreed that taking a look at some parts of NAFTA is worth the time. He just hopes that border leaders are included in the discussions.

“I would say that he needs to at least take a little time here on the border so we can at least try to explain to him the value that the border has for the nation,” he said. “Without NAFTA, the border area and, I would say, Texas, in my humble opinion, would be very economically depressed.”

McAllen Mayor Jim Darling said he hoped those discussions would also include the possible repercussions for the Mexican economy, which directly affects local sales tax receipts north of the Rio Grande.

“It’s understandable that a new administration would review a lot of federal programs, including trade treaties,” he said. “We would hope that before anything happened, there would be a review of the potential impact — not only in Mexico but the United States.”

Read related Tribune stories:

Author: JULIÁN AGUILAR – The Texas Tribune

Texas Lawmakers hope Election Rhetoric doesn’t Swamp Beneficial Trade Deals

LA PORTE, Texas — U.S. Sen. John Cornyn has been in politics long enough to know that hard line, campaign trail talk doesn’t always survive after elections. And he’s hoping — at least for Texas’ sake — that the tradition holds true this year on at least one issue: international trade.

If not, Cornyn could have his work cut out for him trying to keep intact current trade policies, and the benefits they bring to Texas. Both Hillary Clinton and Donald Trump have made trade issues hallmarks of their campaigns, each assailing trade deals to different degrees.

“While I think President Obama has been right on trade generally speaking, he hasn’t been a particularly effective spokesman for the benefits,” Cornyn said.  “And I think a lot of that has to do with the internal divisions within his party on trade.”

That internal strife has seen Democratic nominee Clinton shift on the proposed Trans-Pacific Partnership, a 12-country trade pact Obama and Cornyn support, first calling it the “gold standard” but opposing it in the later months of her candidacy. The switch came after Clinton’s former rival and current supporter, U.S. Sen. Bernie Sanders, I-VT. railed against more free trade policies he said will not prop up the middle class.

Meanwhile, GOP nominee Trump has called the North American Free Trade Agreement the country’s “worst trade deal” and has vowed to end or renegotiate the pact because he believes the agreement ships jobs overseas. Though his comments about Mexico often center on his infamous “rapists” and “murderers” comments and illegal immigration, he’s also said repeatedly stated that the country “beats” the United States on trade.

Cornyn said he hopes tempers will subside after Tuesday, and that whomever claims the White House will adopt a more pragmatic tone.

“I hope that after the election — that after emotions cool — we’ll take a more reasoned approach,” he said. “It’s like so many things [where] we need somebody who’s explaining the benefits of trade for everybody. And in the absence of that you get the more shrill, less responsible voices seem to fill the vacuum.”

Cornyn said the country’s trading relationship with Mexico sustains about 6 million jobs in the United States. Texas is home to the country’s busiest inland ports, Laredo and El Paso. From January to August of this year, the two customs districts have seen $179.5 billion and $63.56 billion in two-way trade with Mexico, respectively. Houston is the country’s fifth busiest trade partner with Mexico, at about $10 billion during the same time frame, according to WorldCity, a Florida-based economics think-tank that uses U.S. Census data to track trade patterns.

According to Port of Houston Authority statistics, the hub supports more than 1.7 million jobs in Texas.


“We see here in Texas the benefits of Texas being the number one exporting state in the country,” Cornyn told the Tribune during a tour of the Port of Houston last week.  “And while you have people — it ranges from Ross Perot Sr. to Donald Trump — talking about NAFTA being a bad thing, I think you’d be hard pressed in Texas to find anybody who believes that.”

The North American Free Trade Agreement, which went into effect in 1994, gradually eliminated most tariffs on several goods traded between Canada, Mexico and the United States. The main focus of the pact was freeing up of most agriculture, textile and automobile manufacturing, according to the Council on Foreign Relations.

The current debate over the TPP centers on that initiative’s goal of becoming what its supporters call a 21st century trade agreement that expands the tariff-eliminating measure beyond North America and includes provisions related to “trade facilitation; sanitary and phytosanitary measures; technical barriers to trade; trade remedies; investment; services; electronic commerce; government procurement; intellectual property,” according to the CFR.

Cornyn conceded the TPP likely won’t move forward during Obama’s last few months in office.

“I talked to Secretary [Penny] Pritzker and the Department of Commerce the other day, and she was asking me if there was any hope to pursue the Trans Pacific Partnership in the lame duck session. I am not optimistic,” he said.

He added that because of the 2015 Trade Promotion Authority, legislation requiring congressional approval for changes to tariff or non-tariff trade agreements, the next president would likely take a more thoughtful approach to trade policies.

“My hope is that given the fact the Trade Promotion Authority is a six-year authorization, that whoever the next president is that they’ll take a more practical, more pragmatic view,” he said.

Cornyn acknowledged the United States will have to make sacrifices to remain competitive. He cited the decline of the textile industries in the Carolinas once those jobs were outsourced overseas.

“What we can do is make sure people get access to the job training they need to replace those skills with good high paying jobs that exist here for which they can’t get an adequate trained workforce,” he said. “But it’s going to take a willingness to target the people who are hurt because there jobs move off shore someplace else.”

Border-area lawmakers have a more nuanced approach to supporting trade deals. U.S. Rep. Beto O’Rourke, D-El Paso, has yet to officially throw his support behind the TPP. Asked during a Tribune event in Austin last week why he’s hesitated, he cited the North American Free Trade Agreement’s double-edged sword effect on his district.

He said that in the immediate NAFTA aftermath, the El Paso border region directly felt saw the losses of thousands of jobs after the low-skilled, low-wage work performed north of the Rio Grande moved south.

“That informs what many of us in this community feel about TPP,” he said.

But he also said some sectors of the region’s economy have undoubtedly benefited from the policy.

“In the decades since the passage of NAFTA, EL Paso has transitioned from a low-wage, low-skilled, labor intensive community to a trade community,” he said. “That’s now connected to one out of every four jobs in the community that I represent. NAFTA is not a black or white [though] it is for many people in the community who lost their job because of NAFTA .”

O’Rourke said a major hurdle for him in supporting TPP is that there is no incentive for Mexico to reform its labor laws and root out the potential for abuse of its workforce.

“There is no consistency plan for Mexico,” he said. “Mexico does not have independent labor unions, they have sham syndicates that purport to be independent labor unions, but they are not. These are organizations that make deals with the management of the factories before the first worker is hired. The workers have no voice and no say.”

Read more Tribune stories on these issues:

  • Caught between the anti-globalist tirades of their presidential standard bearer and their state’s close trade ties with Mexico, Texas congressional Republicans are straddling a tricky political line when it comes to talk of renegotiating the North American Free Trade Agreement.
  • For years, Laredo banker Dennis Nixon has championed trade deals like the North American Free Trade Agreement, calling it vital to the economy in a state that shares a massive border with Mexico. And now Nixon is helping raise money for a presidential candidate whose campaign has been staked on dismantling such deals.


Author:  JULIÁN AGUILAR – The Texas Tribune

Trump Calls NAFTA a “Disaster.” Texas Republicans Beg to Differ

Caught between the anti-globalist tirades of their presidential standard bearer and their state’s close trade ties with Mexico, Texas congressional Republicans are straddling a tricky political line when it comes to talk of renegotiating the North American Free Trade Agreement.

Republican nominee Donald Trump called NAFTA a “disaster” and backed renegotiating the pact in a policy speech in Detroit on Monday. Barring a better deal, he said, the United States should withdraw from the 22-year-old agreement that lowered trade barriers between the United States, Mexico and Canada.

Texas grassroots conservatives also want to abandon the deal. The Republican Party of Texas’ 2016 platform demands “immediate withdrawal from the North American Free Trade Agreement.”

But when The Texas Tribune reached out to each of the 27 Republican members of the Texas congressional delegation, not one joined in Trump’s call for renegotiating the treaty. None agreed to be interviewed, three responded with written statements and the others either did not respond or declined to comment.

“NAFTA is responsible for increasing trade between Texas and Mexico by almost 110 percent since 2004,” Rep. Will Hurd, R-San Antonio, said in a statement.

“Texas leads the nation in exports and benefits from international agreements that put Texans’ goods and services in front of more customers,” said Rep. Lamar Smith, R-San Antonio, who voted to ratify NAFTA in 1993.

In 1991, the year before President George H. W. Bush signed on to the terms of NAFTA, Texas exported $15.5 billion in goods to Mexico, according to the Texas Center’s Institute for International Trade. By 2015, that had increased sixfold. Last year, Texas’ export industry employed 1.1 million people — the most in the country, according to the U.S. Department of Commerce.

“NAFTA is not a dirty word in Texas,” U.S. Senate Majority Whip John Cornyn said in a March interview with the Brookings Institute.

Texas GOP public opinion on international trade deals has nonetheless soured. While no recent Texas polls have tracked NAFTA’s popularity specifically, a June 2016 poll conducted by the University of Texas at Austin’s Texas Politics Project showed 51 percent of state Republicans view trade agreements unfavorably, compared with just 17 percent who support them.

Scott Lincicome, an adjunct scholar at the Cato Institute, said public opinion of trade deals is often subject to “blind partisanship.”

Some Texas Republicans may dislike NAFTA in part because it was ratified when Democratic nominee Hillary Clinton’s husband was president, said Republican Party of Texas communications director Michael Joyce.

Clinton was also secretary of state during early negotiations of the pending Trans-Pacific Partnership.

Even Texas’ NAFTA detractors say the state has seen an economic boost from the deal’s reduced trade barriers.nfta qt

U.S. Rep. Gene Green, D-Houston, who voted against NAFTA’s ratification, said, “I think NAFTA’s benefited the state as whole, but it hasn’t necessarily benefited my district.” Green added that if NAFTA were up for a vote today, he would not vote for it.

U.S. Rep. Beto O’Rourke, D-El Paso, said his region was “devastated” by NAFTA initially, with thousands of manufacturing jobs moving just across the border “almost overnight.” Eventually, though, El Paso adapted to the new economic reality, regaining many of the jobs originally lost, he said.

“If you’re just looking at the net impact, NAFTA was positive,” he said.

Trump’s campaign did not respond to multiple requests for comment, but Trump has suggested that he would renegotiate NAFTA by creating tariffs on certain goods to help protect U.S. manufacturers from foreign competition.

Tim Wise, director of the research and policy program at Tufts University’s Global Development and Environment Institute, has long criticized NAFTA’s lax environmental and labor standards. Like Trump, he would like to see NAFTA renegotiated. But he called Trump’s likely reform plan “absurd.”

“The idea that the U.S. could bully Mexico into accepting whatever trade protection Trump wants to impose without giving anything in return is not the way trade negotiations work,” he said.

Lincicome, a NAFTA supporter, noted that the tariffs Trump may favor are subject to congressional approval. But if Trump were to pull out of the deal, he said, many Texans, particularly poorer consumers and workers in the all-important energy sector, would feel a “devastating” economic backlash.

nfta qt2No Texas congressional Republicans addressed the possibility of a NAFTA opt-out.

In 2008, then-Senators Barack Obama and Hillary Clinton both said the next president should use an opt-out as leverage to renegotiate the deal’s labor and environmental standards.

President George W. Bush, a former governor of Texas, defended NAFTA then, saying, “now is not the time to renegotiate NAFTA or walk away from NAFTA.”

A campaign spokeswoman would not specify which aspects of NAFTA Clinton would now like to see changed or whether Clinton would opt out if those standards are not met.

Many NAFTA critics, including Green and Wise, attribute some of America’s immigration challenges to Mexican workers’ inability to prosper under NAFTA’s poorly enforced labor standards.

Clinton has said she does not support the Trans-Pacific Partnership, which would create stricter enforcement mechanisms for labor and environmental standards in NAFTA countries.

Trump has also not specified the reforms to NAFTA he would like to see. Asked in a July 26Detroit News interview about renegotiation specifics, he assured he wants to change “many, many things.”

Rachel Wellhausen, an assistant professor of government at UT-Austin, said a potential renegotiation of NAFTA may not be as impactful to the larger economic picture as our politics might suggest.

“I would want the political rhetoric to be about job creation in the face of global competition and technology change,” she said. “It’s very unclear what renegotiating NAFTA would do, especially in an economy in which jobs are being lost to technology.”

Disclosure: The University of Texas at Austin has been a financial supporter of The Texas Tribune. A complete list of Tribune donors and sponsors can be viewed here

*Correction: An earlier version of this story incorrectly identified the University of Texas at Austin’s Texas Politics Project.

Author:  – The Texas Tribune

TransCanada seeks $15B from U.S. over Keystone XL

AUSTIN, Texas – The Canadian corporation behind the Keystone XL pipeline, is using provisions in the North American Free Trade Agreement (NAFTA) to recover more than $15 billion in damages from the U.S.

Stephen Kretzmann, executive director with Oil Change International, says the move underlines the threats trade agreements like the Trans-Pacific Partnership (TPP) pose to the nation’s ability to combat climate change.

He says since at least 75 percent of remaining fossil fuels need to stay in the ground to meet goals set in Paris, deals that favor corporate bottom lines make it harder for governments to stand up to powerful companies.

“We are giving those entities rights and the ability to trump those government decisions,” says Kretzmann. “Or at least, extract ridiculous amounts of money in return for decisions they don’t like.”

Kretzmann notes TransCanada’s claim will be decided by a tribunal of three lawyers who are allowed to rotate between acting as judges and advocates for the investors launching cases. He says under the so-called “investor-state dispute settlement” rules, the tribunal has the power to order the U.S. to pay for preparation costs and projected profits.

According to the Sierra Club, TransCanada’s action is part of a rising trend. The group cites a U.S. company’s request for compensation from Canadian taxpayers after a moratorium on fracking in Quebec, and Chevron’s petition to keep from paying for damaging Ecuador’s Amazon rainforest. Kretzmann says so far, trade deals have fallen short of their promises.

“But the reality is, as we’ve seen from NAFTA, jobs leave the United States and there are not adequate environmental and consumer protections,” he says. “The only winners are the corporate backers of these trade deals, at the end of the day.”

Kretzmann adds since NAFTA only covers trade with Canada and Mexico, the TPP deal with 11 Pacific Rim countries could expose the U.S. to claims from more than 9,000 additional foreign-owned firms.

Author: Eric Galatas, Texas News Service

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