Washington's No. 1 economic priority is tax cuts, not NAFTA

Washington's No. 1 economic priority is tax cuts, not NAFTA
From CBC - November 10, 2017

A U.S. lawmaker dropped a remark this week that illustrated how NAFTA is not the No. 1 economic priority in Washington these days, obscured by another paramount prerogative.

That issue is tax cuts.

As America's neighbours wonder whether the U.S. Congress might take a strong public stand against the cancellation of the three-country, free-trade agreement, a candid crack from Chris Collins made clear another economic file is causing cold sweats.

The Republican admitted he's under pressure from his political donors to pass a massive tax-cut package, which would reduce rates on corporations and most Americans and give the wealthiest especially huge benefits by ending the estate tax.

"My donors are basically saying, 'Get it done or do not ever call me again'," said the New York congressman, an early Donald Trump supporter.

That comment drew scorn from opponents as evidence that Republican priorities lie in catering to their rich political patrons. But it also underscored something that is apparent to the save-NAFTA crowd: right now, Congress's attention lies elsewhere.

A visiting Canadian delegation noticed it.

"In every conversation we had with people, they made very clear there's a lot of other files on the table that are important," said MP Bob Nault, who led a Washington visit by the Commons foreign affairs committee. "Tax reform is a big issuethat was clear."

It was the same with Washington's business lobby. Nault said it clearly supports NAFTA but is wary of rocking the boat: "There's another issue the business community likes about Trumpthe tax reform. (Their attitude is), 'We sort of do not want to bite the hand that feeds us'."

The NAFTA and tax issues are clearly intertwined.

Defying the president

One well-connected lobbyist and one pro-business group in Washington have told The Canadian Press that the capital is fixated on tax cuts and as long as that issue is alive, expect a holding pattern on trade.

A series of trade decisions have been put off, like whether to scrap the U.S.-Korea agreement, impose tariffs on China and even NAFTA has had its timeline punted off into the distance, with an anticipated year-end target for a deal pushed to next spring.

One trade-watcher suspects American lawmakers will never take a hard stand on trade.

A protracted NAFTAbattle


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