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Under NAFTA, any trade disputes were to go through an independent bilateral trade adjudication tribunal. Trump wanted them to go through US courts. That's not happening under USMCA; so the status quo is maintained.
Trump wanted Canada to get rid of those so-called 300% tariffs on US dairy products. And that happened. But what Trump did not realize is that:
1. Those tariffs only applied to certain US dairy products, neither of which is milk or cream;
2. Over a certain quota; and
3. Those US dairy products were admitted to Canada duty-free up to that quota.
So, it's not like Canadians will be drinking American milk any time soon. Under the USMCA, Canadians may see a break on the price of shredded pizza cheese eventually, or curds for their poutine. But those are the kinds of products that are addressed; the agreement does not address drinkable milk or cream. The status quo is maintained.
Trump threatened Canadian auto manufacturers with tariffs. But what Trump did not realize is that Ford and GM manufacture different cars in different countries. As I recall, the Dodge Challenger, Chevy Impala, and Lincoln MKX are made in Canada. They are not made in the USA, but they are sold there. Tariffs might have been devastating for Canada's auto industry, but tell the American who wants a Chevy Equinox that it will cost 25% more because it comes from Canada, and he or she will turn to a Ford Edge. Except that's made in Canada too. Okay, a Honda CR-V. Nope, made in Canada again. We're back to the 1965 US-Canada auto pact, and the status quo is maintained.
So you are correct: Canada walked away with what it already had, except for minor concessions on dairy, which won't affect Canadian consumers much. I will say that Canadians like raising the duty-free exemption on cross-border online shopping to $150 (from $20), but outside of that--the status quo remains. But the fact that the US and Canada had to go through 14 months of negotiations to arrive at what they already had is not a victory for Mr. Trump. It is not a failure either--most agree that NAFTA needed an updating. But an updating is not a victory, and should not be sold as such. At best, I'd say that Mr. Trump ranted and raved over renegotiating an agreement that ended up pretty much the way it was before.
Great synopsis. Most people have no idea what the 1965 auto pact is, nor that it never has been rescinded or replaced. If NAFTA had of blown up, you are absolutely correct, nothing could or would change as far as automobiles are concerned.
The only real "loss" that Canada took was the 2 year extension on patent drug protection, and a change to synchronize copyright law. I disagree with the former, and agree with the later change, but one can't get everything in a negotiation.
MAGA enthusiasts normally are not very deep thinkers or take the time to understand reality.
Global auto supplier have many ways to deal with "parts manufacturing" and how ever they deal with it, the higher cost will be upon the sale price of vehicles which will impact Americans Auto Purchasers.
Now, what is going to make American Parts Manufactures step up and pay the $16? When this Administration stands AGAINST raising the Minimum Wage Across the nation.
Are we truly aware of the capital reserves that exist in not just China but the rise of GDP growth in other low wage Asian Nations. This plays right back to the TPP(Trans Pacific Partnership)... which is quite likely to find out, that it was a deal that Trump should not have attacked, because it would have given America accessibility, and that accessibility would play into trade agreements that would keep us in the loop, rather than put us at a point and position of challenging competition.
When the discussion of "Supply Chain" is looked into, the reality is, the supply chain is strong and dominant in Asian Regional Nations. So too is the "natural resource agreement" strong in that region as well. We ignore the value of the AIIB, which all nations except America and Mexico are part of that agreement, Japan is working to meld itself into that agreement.
At some point the value of labor in Central America will become a concern, it may be a decade or so away, as they work on corruption and crime, but fact is they can't go on forever with the level of violence that has overtaken the landscape. We might well see China as well as Russia move to infuse money into the region for economic reforms and development. Because we can be sure, that China nor Russia will be silent and stagnant as the world economics continue to change. As countries that are connected to the N. American Continent, we've long neglected them in ways that we should have worked to change decades ago. What the outcome may be is unknown but it is certain the region of Central America won't remain in the status it currently exist. Mexico will see itself change in relation to any mass growth and development in Central America.
Today, there is "massive money" moving in All sectors of the Globe. Nothing happens in a vacuum, and the rest of the world is paying close attention to "whatever happens".
We can't omit the position of the EU with regards to Iran, and its program to sustain trade beyond any U.S. Sanction... These are not small things.
NAFTA was a 1990's model... based on many factors pre-1990's... so much has changed since then, and the volume of capital that spins in the global arena is astronomically higher than the 1980's or the 1990's and nations are recovering after the global crash... and "everyone learned something"... Even technology since the Crash of 2007-2008 has advanced tremendously.... so "information flows globally".
Trump has found out the hard way that his illusion of American companies expanding industrial capacity in America, is not to be the ease that he assumed, not only is it not moving in that direction, with the Tariffs and other Contentions, it has not slowed companies from looking at ways to produce on foreign shores to avoid being damaged by the escalating cost that the Tariffs will continue to generate. It has not been favorable to the U.S. Industrial growth. Its basically only shaping up how "imports will flow from many other countries". Many other localities are growing and doing so at rapid rates. The shift even in China of investments in other Asian regional nations, all benefit from the massive supply chain that exist in and around that entire region.
America's industry has not expand, it has not raised wages and it faces raising cost to vast segment where wages is stagnated and areas where wage is tired to low wage job types. Tax cuts to the wealthy industrialist, has only given them more capital to invest in emerging industrial centers and those centers are not necessarily in America. Nothing has slowed the off shore housing of money, and nothing has slowed the investments by American companies in foreign locations. Examples, is Harley Davidson, Ford and a host of other Industrial leaders, understand every well where the "supply chains exist" and they see the economics of populations in various countries rising and the purchasing power of people in those countries increasing.
We should look at the building boom that is widespread outside of the U.S. We should look at the change in how education has saw America go from 6th to 27th. Technology will not slow that change down.
We cannot remake the 1940's and 1950's and we are not advancing toward training and educating our mass population on new technology and new skill sets. Yet, we watch as many of the foreign nations are adept at training their people to build "new technology" to a level, we are not on the horizon when it comes to mass retraining. This is a deficit that is far grater than current monetary measure. Nor does it position us for the monetary improvements that mass training could provide us.
We might want to ask are we 'reshuffling coal ash' trying to create heat, while others are storing up on new means of creating economic heat by skill training, and expanding their ability to have tech development wide spread across their nations. We may have innovators that are in a small circle, but what they create is not being mass produced by a well trained American population.
Go to various cities and look at out un centralized tech development and tech manufacturing is. It certainly has meaning when we have vast segment of no high tech training of the broader population. People should really look at "licensing agreement" and they are not being centered in America for production and integration of industry expansion in America.
Good observations. Again, the MAGA crowd won't get this.
The only thing I will add is that automation is rapidly advancing, and companies like GE moved their consumer goods (washers, dryers, fridges) manufacturing back to the USA from Asia, mostly China, because it was now cheaper to build in the USA considering time delays and especially shipping costs from Asia. Bringing manufacturers back will not create smoke-stack plants as in the past, and much of the work will be knowledge based, whether in the trades such as electricians/electronic trades, or IT.
On the contrary, I welcome the phenomenon. It improves consumer choice, among other things. But I also recognize that it leads to a decrease in sovereignty. The auto industry is a perfect example. Fifty years ago the overwhelming majority of cars sold in the US were built and sold by US companies. Nowadays, US car makers have less than half of US market share. As a result of this, the US has to pay much more attention to the desires of Japanese (and Korean and German) companies' desires - and by extension, to the desires of the governments of Japan, Korea and Germany. It goes the other way too: While, say, GM and Ford can also extend their reach to other nations, that means that the people and governments of those other nations have more control over the fate of our companies. It increases interdependence - which I think is a good thing - but at the expense of sovereignty. It is the Trumplings who have been complaining about politicians not "putting America first," and complaining about globalism and loss of sovereignty, but by now embracing all these trade deals, they are doing precisely that which they simultaneously said was a bad thing. They are selling out to the phenomenon they have repeatedly claimed was evil, without realizing that they're selling out.
Thanks, as now I better understand you but not completely...
That or I don't agree about your concern(s) regarding "sovereignty." Addressing the product and service demands of a wider base of customers is simply that, not a loss of sovereignty. Additionally, you assume companies, like those in the auto-industry, represent American sovereignty, but all they represent is the interests of their shareholders. Similarly, as Coca Cola bottles and sells their drinks all over the world rather than just here in America, we're not losing sovereignty. Doing more business in these regards rather than less is not "selling out," but simply selling. Business, and we all know "the business of America is business."
What's really funny is, if Obama or Hillary had promoted and signed this very same deal, the Trumplings would be out calling it the worst thing since sliced bread.
So true, and liberal supporters would be pointing at progress made. Facts, reason and logic always taking a back seat to our partisan back sides...
1. Trump promises Mexico and Canada he won't hit them with auto tariffs
2. Improved safety, labor, environmental requirements for Mexico. Unions and Democrats are super happy.
3. Increased intellectual property protections. Good because provisions were 25 years old and a lot has changed.
4. Pharma can sell drugs an additional two years in Canada before the generics can be used.
5. Review at 6 years.
6. Chapter 11 filings mostly eliminated for private businesses.
7. Dairy, mostly unchanged for Canada. We gained some share in infant formula, skim milk powder, and milk protein concentrate.
Anyone want to throw a ticker tape parade?
I'm no Trump supporter either and though we share that bias, I think your observations are objective and for the most part true. That said, I'm for a ticker tape parade, because if Trump had not also broken this campaign promise to scrap NAFTA, we would have been in some real troubled waters. Too many of Trump's campaign promises were/are misguided, but fortunately Trump is "flipping" on many of them too, so we're not seeing the damage we would if Trump were king and had his way without check...
Good observations. Again, the MAGA crowd won't get this.
The only thing I will add is that automation is rapidly advancing, and companies like GE moved their consumer goods (washers, dryers, fridges) manufacturing back to the USA from Asia, mostly China, because it was now cheaper to build in the USA considering time delays and especially shipping costs from Asia. Bringing manufacturers back will not create smoke-stack plants as in the past, and much of the work will be knowledge based, whether in the trades such as electricians/electronic trades, or IT.
this point is lost on MAGA crowd. Manufacturing didn't go away; manufacturing jobs went away. We manufacture a ton and are on pace to overtake China eventually (at least until Cheeto Jesus got in the way). However, the good paying jobs that will thrive are high tech and knowledge/skill based. 80K a year jobs to push a button are never coming back no matter how many tariffs Daddy puts in place. This big "win" was literally nothing, in fact, as I've posted numerous times already, many economists think the big win on auto worker salaries will just mean more jobs leaving the US.
What message does this send? Trump is busy reworking bad trade deals, improving American lives and Democrats are obsessed with high school parties and race hustling.
"Obsessed with high school parties and race hustling?"
Surely you are not referring to the process underway to confirm the next Supreme Court Justice, for life, are you? Please have mercy...
Good observations. Again, the MAGA crowd won't get this.
The only thing I will add is that automation is rapidly advancing, and companies like GE moved their consumer goods (washers, dryers, fridges) manufacturing back to the USA from Asia, mostly China, because it was now cheaper to build in the USA considering time delays and especially shipping costs from Asia. Bringing manufacturers back will not create smoke-stack plants as in the past, and much of the work will be knowledge based, whether in the trades such as electricians/electronic trades, or IT.
I like you point about ((cheaper to build in the USA considering time delays and especially shipping costs from Asia))... It's so unfortunate that we did not realize this decades ago.
For every pursuit of 300-3000% profit that the U.S. thought it was earning by production in China, has COST the U.S. 300-3000% DECLINE in American, which is reflected in the expanding ghetto's across the nation, the dilapidated infrastructure and the mass cities and towns that suffer industrial deprivation. Then add in the lack of concern to "mass train American People... on New Technology, New Energy, Environmental Concerns and even the basics of technology manufacturing. These thing carry a cost and that is a cost loss we suffer, which is a deficit that shows itself on the surface, but what is beneath the surface of that span of what deficit covers is the intellectual break down of the American workers, the lack of technological skill which is wide spread in America, and this goes to the rural areas as well, when there was no modernization that helped the "independent farmers" and "ranchers" whom many continue to succumb to "industrial mega Farming Corporations. Because technology was not ushered to the rural farmer as a process and program decades ago.
We were only focused on "Financial Markets", thinking we could manage the worlds money, and then came the computer, which gave every country the means to manage its own financial concerns. Then we saw the crash of 2007-2008 when the "gaming in the financial industry" nearly took down the global economy.
EVERY Nation learned from that and they began to make new agreement, build new alliance, and demand some in-depth data on securities before they invest their nations capital resources. Many of these nations turned within, to invest them their own growth, invest in training and building and expanding their industrial bases within their nations. They too faced the need to have their people working.
It may well be to get ahead of the curve, that we focus more on "diplomacy" and "AMERICAN RETRAINING PROGRAMS WITHIN and plan for the future and not invest so much time thinking we can reshape things to recreate the past. It's Gone!!!
We have for two generations seen a withering of young talented minds, who can't get the training, because it's been made cost prohibitive. We are dominated by "Advertising Revenue" and the Sales of Imported goods which that Advertising is focused to promote. Google, is about Advertising Revenue, Facebook is about Advertising Revenue, Amazon is about promoting and selling Imported Goods and direct Marketing of Foreign independent sellers, who buy from foreign manufactures who supply the independent sellers.
Trade agreement rarely impact the high volume of "independent sellers who dominate the spectrum"... Trade Agreement impact "industrial sales between industrial entities within countries".... they have many means to circumvent how they move goods.. "The Advent Of The Independent Seller" skews the dynamics and will do so more rapidly as time moves forward, because it is a direct means of export that does not meet the scrutiny of Import and Export Quota's and certainly does not meet with the impediments of Tariffs as the average purchaser does so, as small volume independents, but they do so in regards to every commodity that fits within low cost, fast delivery sales and movement. Point being "Pennies Equal Dollars'...
We should have learned that lesson when we thought we were getting cheap labor for pennies, and resulted to transfer mass volumes of pennies that the Chinese wrapped and rolled them into dollars. Not only were we not getting cheap labor... we were building up Chinese Shipping Companies, and their Heavy Industry productions of Ships, Containers and everything needed to dominate the Oceanic Movement of Goods and Resource Commodities.
America has not learned the fact that "nothing is free" and when it seeks to pursue slave wage labor on foreign soil, it only coverts American to become more saturated with indentured servitude level wages, and everything erodes, because we don't have the circulation of capital to maintains and sustain, what was built generations ago, and we don't have the industrial capacity to manufacture and produce what we consume, therefore we don't get the circulation of value dollars that help sustain not only the individual, but the communities, the cities and the states.
We should have long learn this lesson from the outcomes of slavery and the indenturing it pose post slavery of low wages and declining revenues in the hands of the people.
We were propped up by World War II military building, then again by World War II military building, and then we wasted vast sums with the Vietnam and its Military Industrial drain of public resources and the mass debt it generated. Then we saw recessions, we saw OPEC make an adjustment when Nixon removed us from the Gold Standard, and the Petro Dollar was born... and from that point we became the "compiler of Debt"... then we moved on to the mass exodus of Industry, to become the Importer of the Century, and on to the process of recession after recession, with spike and crash, that wiped out the potential for American to be mass savers, and then came the jobs losses, the lack of training to advance our people, to the blinding delight people took in the Outsourcing Craze of the 1990's. Then.... we created Wars and fought them on borrowed money.
We NEED A NEW PARADIGM.. and the only one that will suffice... is one where "Unity Prevails" and the respect for and of "Economic Equilibrium Opportunity" is open to ALL Americans... then we can stop with the madness of detesting America's Government INVESTING In America people. We must become a society that is interested in seeing All America's do well.. and one that is not against our own government investing in our American system and backing our own society with programs and resources to achieve those objects... It all bonds, Nation and People into a common unity that is beneficial to our nations and its people.
Of course the Democrats who hate America will say it's not true. They rather see Canada win over the American worker.
When the want to "win" leads to rhetoric like this, we all lose. Not enough the lack of agreement and poor understanding with respect to contrary opinion, they've got to "hate America" too. This is the sort of thinking best ignored I think, but all too prevalent to do very easily. Very sad this sort of thing...
Of course the Democrats who hate America will say it's not true. They rather see Canada win over the American worker.
Nope --mature adults want trade deals to be agreements where everyone is content. It usually means some compromises...some give and take.
The zero sum game is for children and those with fragile egos.
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