A cross border trade deal worth more than $1.3 trillion will proceed after the Senate swiftly gave it the green light on Jan. 16.
The Senate has approved the United States-Mexico-Canada Agreement (USMCA). Fox Business is hailing the pact as the “biggest trade deal of all time.”
“Adding together USMCA and the China deal, that’s over $2 trillion of trade,” Commerce Secretary Wilbur Ross told the broadcaster. “That’s an enormous number.”
The deal came after President Donald Trump promised at the last general election to overhaul the “disaster” prone North American Free Trade Agreement (NAFTA), which the Clinton administration approved back in 1994.
“The farmers are really happy with the new China trade deal and the soon to be signed deal with Mexico and Canada,” the president said on Twitter. “I hope the thing they will most remember is the fact that I was able to take massive incoming tariff money and use it to help them get through the tough times.”
The final vote attracted 89 supporters and 10 who opposed, including Sen. Chuck Schumer (D-N.Y.), Sen. Bernie Sanders (I-Vt.), and Sen. Pat Toomey (R- Pa.) which caught the broadcaster by surprise.
“Now he is a Pennsylvanian Republican and he has voted no,” Fox Business Host Stuart Varney said. “I do not know why he is voting no.”
Co-host Lisa Kennedy Montgomery speculated that Toomey could have opposed the USMCA after Democrats took months to make several changes in the House.
“Some free traders believe it is too constricted,” she said. “It does not amount to free trade and there is some heavy handed government policy that could, in fact, stifle the economy in the long run.”
Mexico has accepted the USMCA while Canada has not because the agreement states 75 percent of automobile components must be made in the United States, Canada, and Mexico to avoid tariffs. The deal also requires workers, who make at least $16 an hour, to manufacture between 40 and 45 percent of the automotive parts.
The International Trade Commission estimates the USMCA could create up to 589,000 jobs and increase the nation’s gross domestic product (GDP) by up to 1.2 percent to nudge the 4 percent growth target Trump believed was possible to achieve back in the year 2016.
“We have what is really the absolute gold standard on digital trade and financial services, stuff that has never been done before,” U.S. Trade Representative Robert Lighthizer told Fox Business.
The national economy previously achieved 4.2 percent GDP growth in the second quarter of 2018 off the back of the Trump administration’s Tax Cuts and Jobs Act, which lowered the highest corporate tax rate by 14 percent to just 21 percent.