With his new trade representative in place, Trump eyes 'massive' NAFTA changes
Trump intends to start talks with Canada, Mexico later this year on renegotiating trade deal
U.S. President Donald Trump says he's ready to start a major renegotiation of the North American Free Trade Agreement, now that his trade czar has achieved his long-awaited confirmation by the U.S. Senate.
The upper chamber voted with a large bipartisan majority Thursday to approve Robert Lighthizer, which gives the administration its U.S. trade representative and allows it to kick-start its NAFTA process.
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The vote was 82-14 to confirm.
Lighthizer was deputy U.S. trade representative under president Ronald Reagan and has worked on trade issues as a lawyer representing various manufacturers and high-tech companies.
Lighthizer will take his cues from a president who's broken with most Republicans in his criticism of free trade agreements and who's spread the work on trade policy beyond the trade representative.
Lighthizer's NAFTA skepticism 'alarming'
Two Republican senators said late Wednesday they would oppose Lighthizer. Senators John McCain of Arizona and Ben Sasse of Nebraska said in a two-page letter to Lighthizer that his confirmation process had failed to reassure them he understands the economic benefits of the North American Free Trade Agreement with Canada and Mexico.
"Beyond your vocal advocacy for protectionist shifts in our trade policies, the administration's ongoing, incoherent and inconsistent trade message has compounded our concern," they wrote.
The senators said they doubted that Lighthizer would champion agriculture and negotiate trade deals to the benefit of American consumers and the economy.
McCain and Sasse said Lighthizer has made his skepticism of NAFTA well-known, "which we find to be alarming."
NOTABLE: Zero GOP Senators joined McCain & Sasse in NAYS vs Lighthizer. Many eyes were on Flake/Cornyn, known free traders, border Senators <a href="https://t.co/Y4ByPq9bLb">pic.twitter.com/Y4ByPq9bLb</a>
—@diazbrisenoSome of Lighthizer's strongest support has come from Democratic lawmakers.
Senator Ron Wyden of Oregon said Lighthizer not only understands how the global trading system works, but also how it sometimes breaks down. Still, Wyden complained that he wanted to get more clarity about the administration's trade agenda, saying it's clear that different factions in the administration have opposing agendas on trade issues.
"So far, this administration's trade strategy amounts to a muddle of 140-character tweets, mixed messages and over-hyped announcements that are backed by little substance," Wyden said.
Chrystia Freeland expected to meet Lighthizer
The president told an interview with The Economist that he intends to proceed quickly after Lighthizer's confirmation: Trump intends to file a 90-day notice with Congress, work with it on negotiating priorities, and start talks with Canada and Mexico later this year.
"The clock starts ticking [with Lighthizer's confirmation]," Trump told the magazine, before the vote. The administration has begun signalling that it wants significant changes in a range of areas, including dairy, lumber, automobiles, pharmaceuticals and the dispute-resolution system.
Trump interjected when an interviewer suggested it sounds like he wants a big renegotiation.
"Big isn't a good enough word," the president replied.
"Massive."
But that desire for a "massive" renegotiation is butting up against the mundane realities of the political calendar. The U.S. and Mexico have both expressed a desire to get a deal by early next year, before the Mexican election. Few observers believe a substantive renegotiation is possible within a few months.
"I don't have a crystal ball, so I'm not going to predict the speed at which the negotiations will advance," Canada's Foreign Affairs Minister Chrystia Freeland said Thursday night in a conference call from Alaska.
"We are going to be good, collaborative constructive partners who effectively stand up for the national interest — I hope that we'll be able to conclude negotiations quickly."
Freeland said she expected to meet Lighthizer soon, and she predicted he "may need to spend a bit of time in consultations prior to formally triggering that 90-day period."
Trump repeated the story in that interview of how he almost withdrew from NAFTA last month. It's a story he's told several times.
He described an amazing coincidence: Both Prime Minister Justin Trudeau, and Mexico's Enrique Pena Nieto, called him one after the other, and both told him almost the same exact thing, urging him to reconsider.
"I have a very good relationship with Justin and a very good relationship with the president of Mexico," Trump said.
"It was an amazing thing. They called separately 10 minutes apart. I just put down the phone with the president of Mexico when the prime minister of Canada called. And they both asked almost identical questions: 'We would like to know if it would be possible to negotiate as opposed to a termination.'
And I said, 'Yes, it is. Absolutely.' So we did that and we'll start."
There's a simple explanation for that coincidence: It wasn't a coincidence.
Trump's own son-in-law Jared Kushner set up the Trudeau call.
Around 6 p.m. on April 26, Kushner phoned a prime ministerial aide, told her there was an immediate window to speak with Trump, and she conveyed the news to Trudeau. Sources from both countries have confirmed that Kushner facilitated the call. In the White House version, Kushner was helping out, responding to a request earlier in the day from the Canadians to speak.
'President Trump is eager for some wins'
One source familiar with the thinking of both governments offered a theory for what's happening: Trump wanted to take credit, before his 100th day in office, for forcing Canada and Mexico into a renegotiation.
The source said the governments of Canada and Mexico did the exact same thing as some companies like Ford and Japan's SoftBank — they let Trump take credit for things they already intended to do.
In the case of the companies, it was building U.S. facilities. In the case of Canada and Mexico, it's renegotiating NAFTA — which both countries had repeatedly stated they were ready for.
"That's what everybody's doing," said the insider.
"[People are saying], 'We're going to let Trump have the announcement — so he gets credit for it.'... They've decided, if they need to give him some victories, as long as it suits us — fine...
"As long as they're not actually, in reality, getting screwed, he can say whatever he wants."
A binational business group suggests one future way this could happen — on regulatory co-operation.
President Trump is eager for some wins. Canada can help provide him with one, while also advancing its own interests- Maryscott Greenwood, Canadian-American Business Council
Canada is already working with the U.S. to eliminate red tape on products. Now that Trump is looking to slash two regulations for every one he creates, Canada could just hand him the credit.
"President Trump is eager for some wins. Canada can help provide him with one, while also advancing its own interests," Maryscott Greenwood of the Canadian-American Business Council wrote in a Policy Options article.
"The Canadian government could present the United States with a proposal for aligning a particular set of regulations. This would represent a bilateral victory for what is at the moment a U.S.-only effort to cut regulatory red tape."
With files from The Associated Press