Ranking Member on Trade Subcommittee Urges ITC to Consider Distributive Effects of USMCA

Two House Democrats said NAFTA led to outsourcing to Mexico, and that they would not support a rewritten version of the trade deal unless it eliminates the incentives for outsourcing jobs by U.S. companies. Rep. Bill Pascrell, D-N.J., ranking member of the House Ways and Means Trade Subcommittee, said "the jury is still out as to whether this deal meets my standard for a better deal for American workers."

Pascrell and Rep. Sandy Levin, D-Mich., testified Nov. 15 at the U.S. International Trade Commission's first of two days of hearings on the U.S.-Mexico-Canada Agreement, which would replace the existing NAFTA. Pascrell said that there were 850,000 auto parts jobs in the U.S. in 2000, and there are about 577,000 auto parts jobs now, both because of automation and outsourcing. "Will the USMCA truly return those lost jobs to the United States," he asked rhetorically.

He criticized the ITC's past modeling, which assumes that those who lose manufacturing jobs because of trade competition find new jobs at similar wages. "Your analysis should not assume a completely fluid and mobile labor market that can simply retrain and move around to find work elsewhere, when so often that is not the case," he said.

Trade "deals are almost always oversold, no matter whose administration it is. In fact, when the original NAFTA was signed, predictions were made that the pact would create a million jobs in the first few years. That did not happen. As claims start to be made about the miracles that the new NAFTA will bring, we are relying on you, the International Trade Commission, to tell it like it really is."

Levin, who is retiring at the end of the year, told the ITC that unless the Mexican legislature confronts protection unions -- not just for future contracts, but the existing practice -- he doesn't think the USMCA will get strong support from Democrats.