While the trade spat between China and U.S. takes center stage the future of the United States-Mexico-Canada Agreement (USMCA) is in jeopardy.
In an interview with Yahoo Finance’s On The Move, former U.S. Ambassador to Canada Bruce Heyman blamed Robert Lighthizer, the United States Trade Representative.
“I think USTR actually bungled this,” Heyman said, adding that if the Trump administration had managed their calendar properly the USMCA would have been passed in Congress by now. “The problem is that they kicked the can down the road. They were being hostile toward the Canadians and the Mexicans alike. And the deal got signed late,” he said, noting that the deal should have been signed in early 2018, the latest. “So, now he has to face the Democratic Congress.”
Another challenge facing USMCA, Heyman pointed out, “under TPA [Trade Promotion Authority], this negotiating strategy which was given to the administration by Congress, it requires consultation — consultation with Democrats, consultation with unions, consultation with stakeholders. They didn't do that either. So now they have an agreement that's all signed off, and they're trying to push it through and get it passed.”
The issue with facing a Democratic Congress is that the majority in the House of Representatives and Speaker Nancy Pelosi are against bringing the agreement for a vote until they’re able to enforce the deal.
Diplomacy is under threat
Heyman, the author of a new book called “The Art of Diplomacy” is critical about how President Donald Trump manages relationships with other countries, “I think the art of the deal, from Donald Trump's perspective, is, I win, and if I win, somebody has to lose. So it's a binary outcome,” arguing that the strategy is one of the reasons the U.S. has failed to reach a resolution on trade with China. Heyman said diplomacy is about “finding paths to reaching agreements with counter parties that you can both win,” an approach that has been historically taken by the U.S. with its allies.
“I think what has happened now is, he's taken this alternative approach, which has now left him alone in his negotiations with China. And this could have been done differently,” said Heyman, referring to Trump.
Regarding the relationship between Canada and the U.S., Heyman said nobody has done more damage to that relationship than Trump. According to Heyman, Canada was the U.S.’s “best trading partner in the world.”
“We had a trade surplus with them. Prior to the steel and aluminum tariffs, we had 15 consecutive years of a surplus with Canada — the United States. Guess what. The last 12 months, we now have a deficit in our steel trade with Canada,” he said. “So something is wrong here.”
Yvette Killian is a producer for Yahoo Finance’s On The Move.