I applaud the President on the signing of “Nafta II” or the “U.S., Mexico, Canada Agreement” or USMCA, as he prefers to call it.
Critics will cite the minor differences between this new agreement and the TPP, which the President rejected immediately after coming into office. For example, TPP gave U.S. farmers 3.25% of the Canadian dairy market, compared to 3.75% in NAFTA II. While I don’t understand the new arbitration process at all and while the give-away to those Big Pharma companies selling biologics is shameful, I still applaud the new deal. No deal can, by definition, ever be perfect.
My greatest fear in Trump’s global trade war has been that we were fighting on too many fronts. Almost unnoticed by the press, there is a truce with the European Union that we will resume fighting another day, probably a year. (They are simply too busy fighting England about Brexit right now.) Assuming passage by Congress, Nafta II reduces the number of fronts we must fight on, setting the stage for a “mano-a-mano” confrontation with China, which will be the toughest negotiation of all.
Initially, the long-view of the Chinese make them better strategic negotiators, compared to the U.S. style of tactical negotiating. Will we give up anything of long-term significance to get short-term bragging rights? My greatest free-floating anxiety about the trade war with China is that we don’t understand the Oriental perspective of “face,” and they don’t understand American egomaniacs.