Commerce Secretary Wilbur Ross has repeatedly downplayed the importance of the North American Free Trade Agreement to the U.S. and that’s prompted farm-state senators to try to persuade him otherwise.
Eighteen Republican and Democratic senators are calling on Ross to produce an economic analysis of effects on the U.S. ag sector before any major change in NAFTA is agreed upon, presumably including a U.S. withdrawal from the massive trade pact with Canada and Mexico.
“It is imperative that before any changes are made to NAFTA, or any other free trade agreement, that economic analysis that illustrates the impact on the full supply chain of the industries involved be shared,” the senators said in a letter to Ross with today’s date. “As such, we request an economic analysis that examines and evaluates the impacts to crop and livestock sectors as a result of any change to NAFTA,”
Agriculture groups across the U.S. have stressed in their own letters to Ross, U.S. Trade Representative Robert Lighthizer and President Donald Trump that the country's farmers and ranchers are already suffering under low commodity prices and declining income. They stress that any interruption of trade with NAFTA partners Mexico and Canada, two of the largest foreign markets for U.S. grains, meat and dairy, would be devastating.
But Ross, at a Wall Street Journal event last week, said the U.S. could withdraw from the pact without any major repercussions. A U.S. withdrawal, he said, “would be far more damaging to them (Canada and Mexico) than to us.”
The U.S. ag sector disagrees. Most Mexican and Canadian tariffs on U.S. farm commodities dropped to zero under NAFTA and the result has been massive increases of U.S. exports of rice, corn, soybeans, sorghum, pork and other products.
Nick Giordano, vice president and counsel for global government affairs for the National Pork Producers Council, says that if the U.S. pulls out of NAFTA, "we will lose $1.5 billion collectively over the industry -- that’s 5 percent of our production gone. That would be about $12 per hog.”
It’s those kinds of potential losses and Ross’ dismissal of the importance of NAFTA that spurred the lawmakers' letter.
"As Senators representing states with significant agricultural economies, we write to you today to underscore the vital role that agriculture plays throughout our home states and across America. Given your recent comments regarding agriculture and international trade, we find it essential that Congress’ voice be heard.”
Senators Pat Roberts, R-Kan.; John Boozman, R-Ark.; Heidi Heitkanp, D-N.D.; Joni Ernst, R-Iowa; and Claire McCaskill, D-Mo., were among the 18 lawmakers signing the letter. Click here to see a complete list of signees.
“With the fifth round of NAFTA renegotiations underway, the senators were clear that any changes to U.S. trade policy must be positive for agriculture, especially in a time when many farmers and ranchers are struggling financially,” Ernst said in a statement.
Ross should not be surprised to get the letter. Speaking at the Wall Street Journal event, he called all of agriculture a “special interest group” and said the sector complicated negotiations that would be much easier to conduct without public scrutiny.
“As one special interest group -- take agriculture for example – gets nervous, they start screaming and yelling publicly,” Ross said. “They start writing letters, soliciting the Congress people and then they start screaming and yelling in public. It just complicates the environment and frankly makes the negotiation harder.”