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U.S. Chamber of Commerce Strongly Lobbying to Protect NAFTA

The U.S. Chamber of Commerce is strongly lobbying to tweak – not trash – NAFTA, with American transportation companies joining other business heavyweights in leading the charge, reports Logistics management magazine:

Here’s a snapshot of the editorial:

Since the talks opened in August, the Trump administration – to the chagrin of many trucking executives – has been playing hardball in its “America First” approach to the negotiations.

Specifically, U.S. representatives are pushing for a hard-fixed percentage of “Made in America” parts and raw materials for many industries, including automotive and textile. Opponents say that is futile and point to the 400% growth in cross-border trade since NAFTA was implemented 24 years ago.

While modernizing the 23-year-old NAFTA makes sense, its backers say withdrawing from the agreement would be a blow for the United States — one that would hit some states particularly hard. Ironically, those likely to suffer most would be Midwestern industrial states, heartland farm states, and border states like Texas and Arizona — nearly all of which voted to elect President Trump.

Scuttling NAFTA will unravel many of these Western Hemisphere supply chains, backers say, threatening hundreds of thousands of America’s jobs.

… Jacking up NAFTA’s content requirements in a mistaken bid to induce even more U.S. content into these supply chains would also threaten American jobs. Well-documented auto industry concerns — that higher content requirements will lead to less, not more U.S. content — are mirrored in the textile and apparel industry as well.

Other proposals envision linking NAFTA up with other hemispheric partners so that the trade agreements would mirror how the industry views this part of the world — as one integrated region. Such ideas are key to ensuring NAFTA is successful for many years to come.

“The administration wants to increase the amount of U.S. and regional content in NAFTA trade, but we must look at this more holistically and ask instead how we can increase NAFTA trade overall,” the Chamber wrote in a white paper on NAFTA.

The distinction is critical, the Chamber says. That’s because if the U.S. settles for increasing content in NAFTA autos, textile and apparel trade, but that NAFTA trade drops due to the more burdensome requirements, the U.S. economy loses in the long run–and quite likely in the short run too.

In other words, does the U.S. want a bigger piece of an ever-shrinking pie, or do we want the pie to get bigger? Negotiators are working on that issue currently.

Full article here.

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