Listening from. I am an emeritus law professor from the university of arizona. Very pleased to welcome all of you. Our five first of webinars of the implication of the trade agreement of the usmca , which as everyone knows was forced about two months ago on july 1. In october, the usmca provisions on auto parts account for 25 plus Percentage Points of manufacturing trade in north america then then, in november, we will talk about other provisions and in december, we will switch gears and focus on some of the stakeholder issues. At the companies that are directly involved in importing and exporting across the north american borders who are dealing with the new enforcement provisions. Origin and kind of other challenges, the nittygritty that determines whether trade is going to work or not. All of these webinars are free. You do need to register to get on big marker. We thought it would be a port appropriate to start the series with a question of context. You have the usmca. It was negotiated back in the late summer and fall of 2018. Signed november 20, 2018. Move forwardot until fall of next year. Mostly october, november, particularly december, where it was modified modified and the downside appeared to be difficult negotiations. By chairman neil and Speaker Pelosi, and the u. S. Trade Representatives Office and Steve Mnuchin. We were fortunate in convince and convincing two significant members of the ways and Means Committee to join us today for this discussion, some of the factors that led to approval of the usmca. These members of the committee are going to share their observations. Means is by far and away the most Important Committee in the house. It is not only responsible for trade and tax and tariff policy, but also tax and social security, medicare, welfare, and related registration legislation. Kevin going to start with brady, a republican from the eighth district of texas. He is a ranking republican number of the ways and Means Committee. He was an executive for the chamber of commerce and served in the texas house of representatives. He is a person of broad interest. Health care, small business, chair of the house committee, he has been working hard over the years to try to improve American Health care without increasing the cost and he has been a key participant in bilateral efforts over the year to deliver effective Disaster Relief for communities affected by hurricanes like harvey, maria. From west virginia, in the past he has had other important posts. He served as Lieutenant Governor of virginia. Interests inrought Climate Change, individual disabilities, those on welfare, programs designed to discourage High School Dropouts and teenage pregnancy, and a series of reforms in the state of virginia. Also, quite important many , he wasportant for many a strong proponent in switzerland during that. , working with the u. S. Justice department to try to call the abuse of Swiss Bank Secrecy by americans who are trying to shield their income from u. S. Taxation. Here we have two experts and we asked both of them to speak for each and give their observations to help understand this process. I have asked congressman brady to speak first. Briar hasessman finished his remarks, i will be the moderator for questions. Those of you in the audience who have questions, please use the q and a function. Short keep your question and related to the subject matter, and i will try to have as many of those answered by our esteemed colleagues here as possible. Jim and brady, it is your floor it is your brady, floor. Here. Nks for having me we are fortunate to have you in that role, so thank you for that. It has been almost two years and a week since you had me to talk about the prospect of the usmca, and i am glad to come back to talk about the context and dynamics of it. I am proud to be joining congressman briar, who is a friend and while relatively new to the committee means more to you than you know it because he brings his business expertise, digging into policy issues, working on finding common ground. There is so much more that unites us then divides us, both in america and in congress as well. The usmca has turned out to be a historic moment where members of congress and the administration put their differences aside and achieved something very important for the american people. Youve asked us to talk about the context and dynamics of this, which will be followed by a series of seminars or webinars dealing with the specifics. Lets talk about the dynamics. I will give you my view from having worked on 13 of the 15 trade agreements that are in place today. Having led several of them, a over wto reforms. Let me give you some of the dynamics. First, we have a 25 year agreement, really the largest of its kind in the world that has achieved many, not all, but many of its original goals, including quadrupling trade between three partners, making products more affordable, integrating the economy so that our businesses could compete better abroad because of this agreement. It was economically successful, yet clinically very unpopular. We have a president ial candidate who had vowed to renegotiate it was this time not because of his campaign promise, it was because as we know, President Trump has held decades thatfor america had not been a winner in past trade agreements or in global institutions. Work in his view, it was American Workers that paid the price for this. There was recognition among north american trade leaders that nafta, despite its successes, was outdated. Andeeded to be modernized there had been a global search, bilateral and trade agreements have also left america outside of it. What we knew, clinically, and what i have seen since nafta with very few exceptions, within congress, there had been a gradual insignificance. And i mean dramatic deterioration of bipartisan support in congress for trade. There was growing opposition within the democratic party, oftentimes leading to very sparse support for traderelated issues, and in some cases political issues. And in some cases, political punishment for in the primaries, for democrats that crossed the trade line to join with what was the overwhelming republican support for new trade rules. View, at the my moment, there was opposition in the Democratic House to initiatives by President Trump, yet very strong support for continued trade with our largest trading partners, canada and mexico. Part of the untold story here is what happened next among all of those dynamics. Not even mentioning steel and aluminum tariffs and other issues. I think what surprised me in looking back is that President Trump and his trade ambassador, bob lighthizer, made it very clear from the start the usmca would be a bipartisan agreement. And it would gain strong support by democrats and republicans. I think don would agree that that was met with skepticism from all corners here, including me. But the negotiating objectives that they set forth immediately reinforced this approach, as well as extensive confrontations consultations that Robert Lighthizer held with what had been traditionally antitrade labor democrats, as well as labor unions that had always been opposed to trade agreements. When the agreement came out in october of 2018, it did a number of things, but it was clear it had given labor democrats concessions in trade that they had long sought but never achieved, even coming close to any of them, with past administrations. ,specially in the area of labor dispute settlement, and automotive rules that required higher wages in mexico and i hear u. S. And north america content in these vehicles and cars. From there, Robert Lighthizer continued to listen to and meet with democrats and republicans and labor unions throughout congress. And i think, too, his background in the senate with ustr as a steellabor attorney gave him really the skills to work with both parties. And i think it was crucial to working group that Speaker Pelosi created something that focused on standards and funding, as well as leadership by democrats, such as our chairman reaching new. Our chairman richie neal. I think that contributed to what turned out to be historically a somewhat shocking bipartisan vote in congress. Theres no question the agreement is sound and retains the successful foundations of nafta, including zero tariffs on u. S. Goods that we sell to mexico, nearly all products we sold to canada. It open to the Canadian Market further for dairy, wine, and poultry. It locked in many key reforms in mexico on energy and telecom. It created a level Playing Field for financial services, investment, and established really the best digital trade rules of any trade agreement in existence today. Which helps people in their online commerce, regardless of the size or type of business. Theres no question, because it protected u. S. Intellectual property, tools to guard against piracy and counterfeiting, that it will spur u. S. Innovation. I will make this point, too. The working relationship excuse me, the business relationship between the u. S. , mexico, and canada was very strong. So our question was, how much bigger, with the agreement, could we grow that relationship . The short answer is it will and it will be significant over time, but i think the benefits of this agreement were not in quantity but in quality. This agreement set standards for what a 21stcentury trade agreement ought to look like. Endet standards to discrimination in regulations. Removed tactical barriers to trade, modernized the custom process, so we can move legitimate goods across the border pastor and faster and more affordably. I think it was vital that america came up with a number of key changes there. Of importance to democrats and republicans is this includes the strongest and most enforceable labor provisions in u. S. Trade history. And i think this agreement requires mexico to create a true union system, including rights that all workers will be guaranteed, like collective bargaining rights, the right to strike, and tools to protect Mexican Union workers against violence. In many ways, this was those sections were in effect dream provisions for labor democrats who had long worked to see this in trade agreements. An i think itd the final it ended the predicament we had forced workers to compete with artificially low mexico wages. The final point, i think the whole agreement is enforceable, unlike nafta. That means no countries can block the panels that can resolve disputes the ultimately occur. I also think because it created certainty where there was uncertainty within the trade and economic community, i think this was an area where the usmca will create further growth in all three countries. This is an area where ultimately republicans, democrats, President Trumps trade team worked together to find consensus. It was an allhandsondeck effort, as don will tell you. He was deeply involved in this. And i am immensely proud of the bipartisan support. Ive counted noses for a lot trade agreements over the years, and for me, watching the house watching every member of the texas delegation, house and senate, vote yes for this agreement was something i never thought i would see. With that, thank you for having me. I yield the floor to my friend, don. Rep. Beyer thank you very much. I am thrilled to be part of this. My youngest is a rice graduate, so when i heard from the Baker Institute and with kevin brady, it was an instant yes. David, thank you for hosting us and for moderating this. I totally agree with you on the importance of the ways and Means Committee. Chairmanan brady and neal often point out, it is the only committee mentioned in the u. S. Constitution, the oldest committee, and the one that we get to brag about most. You mentioned also that i was in switzerland. One of the most biggest responsibilities in representing your country overseas is trying to stimulate positive trade relations between that country and home. And i was very proud that tiny Little Switzerland was the number one investor in 2010. I wish i could get credit for it. [laughter] and i am delighted to serve and do this with kevin brady. I served with kevin when he was the acting chairman of the joint economic committee. And watched with envy as you chaired the ways and Means Committee for a number of years. And, kevin, you are such a good guy, and often we have different viewpoints in the hearings and debates, so it is a thrill to be here to agree with almost everything you said. [laughter] and to reaffirm your notion that we have much more in common than what divides us. So, thank you for being with us. The usmca really does stand as one of the very few real bipartisan achievements of the last few years. It is the product of two negotiations, both of which at times came a little closer to failure than success. It was a courtship between Robert Lighthizer and his canadian and mexican counterparts. And i wasnt part of those. In the seminars to come we will hear about them. But the second negotiations between House Democrats and Robert Lighthizer was no less critical to the success of the final product that went into course earlier this summer. In november 2019, after the president had signed the original agreement, we knew that it had many positive elements, a lot full from nafta, but also from the perspective of the House Democrats, that were fundamentally flawed. There were concerns around the dispute mechanism, which is written because the panel blocking was fundamentally broken. That meant whatever its merits, this is not an agreement that was going to go with legal force. This was especially true when it had to face votes from the house and senate democrats, who had become ever more suspectd of trade agreements and of the impact on the american worker. Remember that only 27 House Democrats voted for a democratic trade Promotion Authority for a democratic president , barack obama. And very few, you could count them on one hand, of House Democrats were enthusiastic about the tpp, as it was presented. I am one of the very few, so i can say that. So if i had to handicap the prospects of the agreement at november 2019, i would have been pretty pessimistic. However, there were key elements that made the ultimate deal achievable, including recognition across the aisle that after 25 years nafta needed to be updated. In fact, people on both sides, those who are making public statements, had underlined the difficulties, but also outlined the elements that would make the deal possible. Once other governments understood the process we had to go through in the u. S. , and were willing to make the necessary changes to be part of the negotiations, that led to the bonus areas in the agreement. You know, in certain areas, like the dispute resolution mechanism, i learned American Partners probably prefer the house position, but mexico in particular was asked for a difficult political move. The negotiating structure was clear. Investor lighthizer was ambassador lighthizer was motivated and empowered to make a deal on behalf of the president. We see in the current impasse over the sorely needed covid assistance package, that im sure has mr. Brady worried about every night, that it is how difficult it is when there are too many cooks in the kitchen. To torture a mixed metaphor, that really conveys the message and the situation. I believe if Steve Mnuchin and nancy pelosi alone were doing this, we would have a deal already. We are still hoping and praying they will get one soon. Despite what people said about the negotiations, Speaker Nancy Pelosi was committed to a workable agreement. She kept saying, we want to get to yes. Something that could pass the house, and then help with the uncertainty over the american economy. So she created an unorthodox negotiating process that ensured the final agreement had the necessary buyin from the House Democrats and senate democrats, that assured a remarkably Strong Majority in both houses. The house counterpart to the ustr was not always popular in our party. There were many of us. And it drew criticism from people who thought that members of the working group signaled a hardline approach unlikely to get to yes. For example, rosa delauro, who led the fight against trade Promotion Authority, was on that working group. Jan schakowsky, not a fan of trade agreements, on the working group. The final product actually made the structure pretty clear. With stalling or personal to ersonal animus to the president , but when we finally got to an agreement to it shed light on that theory, that we were ready to go to work as long as the administration recognized that political pressure could not substitute for reform. So the reforms kevin mentioned the good things, including language that allowed parties to block the formation of the dispute settlement panel, which had be devoted the original agreement. And for the First Time Ever it created rules of evidence that would help the u. S. Litigate intensive disputes. Of course, the most difficult and the most consequential part was the labor enforcement mechanism. Chairman kevin brady talked about the dilemma with developing meaningful trade unions, labor unions, in mexico. But this was able to set the structure, including in mexico, to move forward on that. It is underappreciated how novel and important and progressive it is to have an agreement that holds parti