Nafta Talks Left Reeling After Aggressive U.S. Proposals Land

[Lynarii]

So what happens if we kill NAFTA?

In practice? A major shakeup in the business world. States that trade heavily with Mexico and Canada will get screwed (which is why such states are heavily opposed to it being killed), a lot of wall street bankers will get filthy rich by trading stocks in the winners and losers, and in general prices will go up on a lot of products. A whole hell of a lot of people will lose their job. In theory, wages will go up and new jobs will form, but depending on who you talk to, whether there will be enough of those jobs or increases to offset the losses range from "Covered and then some!" to "Not a hope in hell" depending on who you ask. Either way, the hit will be fairly immediate, whatever recovery will take many years to pan out, simply because moving around major factories is not a fast process.

[jdbond592]

We start at WTO trade rules and create an agreement from there I believe.

And why would someone sign any new trade deals with America?

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In practice? A major shakeup in the business world. States that trade heavily with Mexico and Canada will get screwed (which is why such states are heavily opposed to it being killed), a lot of wall street bankers will get filthy rich by trading stocks in the winners and losers, and in general prices will go up on a lot of products. A whole hell of a lot of people will lose their job. In theory, wages will go up and new jobs will form, but depending on who you talk to, whether there will be enough of those jobs or increases to offset the losses range from "Covered and then some!" to "Not a hope in hell" depending on who you ask. Either way, the hit will be fairly immediate, whatever recovery will take many years to pan out, simply because moving around major factories is not a fast process.

Awesome! Lets do it!

[Endus]

So what happens if we kill NAFTA?

NAFTA's not done. Trump and friends are trying to renegotiate it, but if they fail to do so, NAFTA continues; it wasn't expiring.

If the USA decides to unilaterally pull out (ignoring the presidential/congressional authority issue, which isn't settled so far as I'm aware), then Canada and Mexico stick with it between themselves. The USA can establish tariffs and the like, but so can Canada and Mexico. There would be a general cooling of trade between Canada/Mexico and the USA, but the important factor there is that 1> there'd still be a lot of trade, despite everything, and 2> the USA's position is becoming isolationist, and they won't be seeking new free trade agreements with other partners to make up this economic cooling. Canada, at least (don't follow Mexican politics enough to say) is already exploring deeper economic partnerships with the Trans-Pacific Partnership (which the USA is withdrawing from, see above), the CETA deal with the EU, and we're already talking with the UK about some closer economic ties in the aftermath of Brexit, to boot. So the cooling effect isn't likely to hit Canada nearly as much; we'll adjust our trade accordingly, but the USA is essentially declaring that they're hostile to doing so, ideologically.

There'll be growing pains, but Canada at least is likely to recover far more swiftly/readily than the USA is.

[Lynarii]

And why would someone sign any new trade deals with America?

Well, Britain will. If they no-deal exit from the EU, they will be required to take whatever trade deal the US offers them to survive, no matter how bad it is.

[Vyuvarax]

And why would someone sign any new trade deals with America?

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Awesome! Lets do it!

They'd sign, in theory, because the agreement is beneficial and have assurances they feel are sufficient that the agreement will be upheld.

[Lynarii]

If the USA decides to unilaterally pull out (ignoring the presidential/congressional authority issue, which isn't settled so far as I'm aware), then Canada and Mexico stick with it between themselves.

Lets be perfectly honest here. If the USA pulls out of NAFTA (which I also think is unlikely to actually happen), then it'll be dead for all intents and purposes. Technically Canada and Mexico will still have the deal between them, but they don't trade a whole hell of a lot with each other, and the logistics of doing so around a large and hostile nation in between the two are somewhat prohibitive. Both countries will be more interested in looking at TPP than salvaging the remains of NAFTA without the US.

They'd sign, in theory, because the agreement is beneficial and have assurances they feel are sufficient that the agreement will be upheld.

If the US was interested in a mutually beneficial agreement that they were willing to uphold, then they'd be able to renegotiate NAFTA successfully.

[Endus]

Well, Britain will. If they no-deal exit from the EU, they will be required to take whatever trade deal the US offers them to survive, no matter how bad it is.

That's vastly overblown. Brexit doesn't mean trade between the UK and the EU is ending.

[Vyuvarax]

Well, Britain will. If they no-deal exit from the EU, they will be required to take whatever trade deal the US offers them to survive, no matter how bad it is.

Yeah the UK is in a lot of trouble if their negotiations with the EU fall through. The Torries are secretly floating a system where they'd basically be under the US, even adhearung to standards from our FDA instead of their own body.

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That's vastly overblown. Brexit doesn't mean trade between the UK and the EU is ending.

No, but it would mean a giant recession without a deal and WTO rules go into effect.

[Mittens]

well clearly reducing debt is really specific!!!! Again what a joke.

Again the idea if to reduce the difference between export and import which frankly has less to do with trade deals then with shitty US export. Made in the USA was never really a selling point for most of us you know.

Reducing deficit is mainly referring to the auto industry, which both Mexico and Canada are cheating the system by allowing below rule of origin auto parts receive NAFTA benefits. You are free to read the whole thing, it's really short.

[Lynarii]

That's vastly overblown. Brexit doesn't mean trade between the UK and the EU is ending.

I mean survive politically, not survive as in 'the population will starve'. Brexit was sold as an opportunity to gain power on the international front. Trade between the UK and the EU won't end, but it will be reduced, so the UK would need a good deal with the US if Theresa May doesn't want to be raked over open coals when it's all said and done.

[Mittens]

NAFTA's not done. Trump and friends are trying to renegotiate it, but if they fail to do so, NAFTA continues; it wasn't expiring.

If the USA decides to unilaterally pull out (ignoring the presidential/congressional authority issue, which isn't settled so far as I'm aware), then Canada and Mexico stick with it between themselves. The USA can establish tariffs and the like, but so can Canada and Mexico. There would be a general cooling of trade between Canada/Mexico and the USA, but the important factor there is that 1> there'd still be a lot of trade, despite everything, and 2> the USA's position is becoming isolationist, and they won't be seeking new free trade agreements with other partners to make up this economic cooling. Canada, at least (don't follow Mexican politics enough to say) is already exploring deeper economic partnerships with the Trans-Pacific Partnership (which the USA is withdrawing from, see above), the CETA deal with the EU, and we're already talking with the UK about some closer economic ties in the aftermath of Brexit, to boot. So the cooling effect isn't likely to hit Canada nearly as much; we'll adjust our trade accordingly, but the USA is essentially declaring that they're hostile to doing so, ideologically.

There'll be growing pains, but Canada at least is likely to recover far more swiftly/readily than the USA is.

Trade between Canada and Mexico is laughably small, so by all means and purposes without the US in NAFTA the treaty is over.

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Yeah the UK is in a lot of trouble if their negotiations with the EU fall through. The Torries are secretly floating a system where they'd basically be under the US, even adhearung to standards from our FDA instead of their own body.

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No, but it would mean a giant recession without a deal and WTO rules go into effect.

Nah, the UK just needs certainty ASAP. A deal between the US and UK would provide such.

[Lynarii]

Reducing deficit is mainly referring to the auto industry, which both Mexico and Canada are cheating the system by allowing below rule of origin auto parts receive NAFTA benefits. You are free to read the whole thing, it's really short.

And if the US wanted to plug that loophole, I would consider that a fairly reasonable request. The reason that such abuse exists is because the current NAFTA rules are part specific to a lot of parts that are no longer used in autos, while a lot of parts that are currently being used aren't covered. That's an obvious spot where the US has a good case for improvements to be made. Thing is, they aren't trying to plug the loophole. They explicitly want cars manufactured in the US to be exempt from country-of-origin rules, while Canada and Mexico would be required to use more parts from the US than from their own home country. That's insane.

[Vyuvarax]

Trade between Canada and Mexico is laughably small, so by all means and purposes without the US in NAFTA the treaty is over.

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Nah, the UK just needs certainty ASAP. A deal between the US and UK would provide such.

The UK wants a deal that is better, not certainty. The US will not be able to provide a better deal, mostly because the industries that the U.K. wants to protect (ag, banking) the US has no intentions of giving a good deal on.

The UK is going to eat proverbial shit on the brexit vote due to an overestimation of their economic strength.

[Mittens]

And if the US wanted to plug that loophole, I would consider that a fairly reasonable request. The reason that such abuse exists is because the current NAFTA rules are part specific to a lot of parts that are no longer used in autos, while a lot of parts that are currently being used aren't covered. That's an obvious spot where the US has a good case for improvements to be made. Thing is, they aren't trying to plug the loophole. They explicitly want cars manufactured in the US to be exempt from country-of-origin rules, while Canada and Mexico would be required to use more parts from the US than from their own home country. That's insane.

I didn't know it excluded american manufacturers, do you have a source on that?

[Lynarii]

I didn't know it excluded american manufacturers, do you have a source on that?

https://apma.ca/u-s-proposes-to-exem...-auto-demands/

This is a repost of a Globe and Mail article because the original is behind a paywall. I don't know APMA at all, but Globe and Mail is generally a fairly reliable source.

The relevant lines are...

The United States is proposing to exempt itself from a key automotive provision it has tabled in the North American free-trade negotiations – a move that experts say would seriously threaten Canada’s ability to land new investment by auto makers.

The Americans have proposed that vehicles shipped to the United States from Canada or Mexico contain 50-per-cent U.S. content, but would not apply that requirement to vehicles made in the United States that are exported to the other two NAFTA countries, according to sources familiar with the negotiations.

Such an exemption would make one of the most protectionist demands the United States has put on the NAFTA table even more stringent, and would divert investment by auto makers in new assembly plants to the United States and away from Canada and Mexico, auto industry officials and trade experts say.

[sarahtasher]

Good stuff coming from the NAFTA talks now that the US has almost full control of the talks. The cucking of Canada and Mexico continues.



https://www.bloomberg.com/amp/news/a...proposals-land

I love how ''manhood'' boils down to forcing other countries at gunpoint to accept trade deals. Forcing them to accept them and then cry like little girls ''UR UR UR, IT'S UNFAIR, DUH FOREIGNERS CAN KOMPETE WITH US''

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F NAFTA.

Indeed, f all free trade agreements. All of them.

In their arse, with an iron stick.

"Give us a protective tariff and we will have the greatest nation on earth." --- Abraham Lincoln

"I am for ruling America, for the benefit, first, of Americans, and for the 'rest of mankind' afterwards." --- Vermont Senator (1867-1898) Justin Morill

Free trade is anything but conservative. It is a force destructive of a nation's working class. It is economic treason.

That's about the only thing Bannon and I would agree on.

I know your sites branwashed you in believing that trade deals ''are a tool of the liburals cucks'', but it's the Republicans that rammed NAFTA through Canadian throats.

[Mittens]

I love how ''manhood'' boils down to forcing other countries at gunpoint to accept trade deals. Forcing them to accept them and then cry like little girls ''UR UR UR, IT'S UNFAIR, DUH FOREIGNERS CAN KOMPETE WITH US''

I know your sites branwashed you in believing that trade deals ''are a tool of the liburals cucks'', but it's the Republicans that rammed NAFTA through Canadian throats.

TIL Canada doesn't have a department that negotiates for them.

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https://apma.ca/u-s-proposes-to-exem...-auto-demands/

This is a repost of a Globe and Mail article because the original is behind a paywall. I don't know APMA at all, but Globe and Mail is generally a fairly reliable source.

The relevant lines are...

That sucks, hopefully, its just overshooting and scaling back based on concessions.

[sarahtasher]

We have negotiators. We also have partners that are mentally unable to accept any kind of competition and who considers that they are too good and too manly to stick to their own deals.

[jdbond592]

Canada needs to look further west and let NAFTA die. It will hurt for awhile but they will recover.

[Lynarii]

That sucks, hopefully, its just overshooting and scaling back based on concessions.

Even before the US exemption was added, the 50 percent US parts rule was considered to be a poison pill added so that they could gain concessions for dropping it. General feeling is that the only reason they'd take that and make it even more extreme if the US plan is to keep piling on impossible demands until Canada and Mexico both walk away, that way Trump can claim that negotiations have failed and the only option is to tear it up. It's a valid negotiation technique, simply one generally reserved for enemies rather than friends.