Iowa ag leaders say USMCA trade deal top priority this congressional session

With the beginning of the congressional session, Iowa political leaders say they want the ratification of the USMCA to be a top priority.


Thomas A. Stewart

Sen. Chuck Grassley, R-Iowa, stands on stage at the Second Annual Harvest Festival on Saturday, Oct. 13, 2018. He serves as the Chair of the Senate Judiciary Committee.

Julia Shanahan, Assistant Politics Editor

In the midst of multiple federal battles on the agriculture front, Iowa political leaders say ratifying the United States-Mexico-Canada Agreement and finishing trade negotiations with China are top priorities ahead of this congressional session.

Sen. Chuck Grassley, R-Iowa, said in a Sept. 11 conference call to reporters that both trade agreements are important to Iowa’s agriculture industry. He said trade negotiations with China were supposed to finish on May 1, but China backed out, adding that talks are supposed to resume in October.

“So who knows what’s going to happen in an authoritarian country like China,” Grassley said during the conference call. “Those two things are very important to agriculture.”

Grassley, chairman of the U.S. Senate Finance Committee, said in June that he planned to introduce legislation that would limit President Trump’s power to impose tariffs under Section 232 of the Trade Expansion Act of 1962, which allows the president to create trade laws for national security purposes.

The USMCA was signed by the leaders of the three countries in November and was ratified by Mexico in June. The new agreement still needs to be ratified by the legislative branches of U.S. and Canada. The agreement would increase the U.S.’ access to the Canadian dairy market and strengthen the markets for corn, soybeans, and poultry specifically to Mexico, according to an Aug. 27 statement from the White House.

In an email from Iowa Gov. Kim Reynolds’ communications director Pat Garrett, he said Reynolds believes Congress needs to ratify the USMCA this congressional session.

“Doing so will create new opportunities for Iowa families, farmers, manufacturers, and small businesses,” Garrett wrote in an email to The Daily Iowan.

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In an April study from the U.S. International Trade Commission on the USMCA, it said the two elements that would have the most significant effects on the U.S. economy are the country of origin rules, meaning an automobile has to have at least 75 percent of its components manufactured in one of three countries to qualify for zero tariffs, and the digital-trade provisions, which would prohibit tariffs on things like music and e-books. 

The study also found the new agreement would increase the U.S. GDP by $68 billion and create 176,000 U.S. jobs. The manufacturing industry would see the largest increase in wages and employment, according to the report.

Iowa Secretary of Agriculture Mike Naig said while there are multiple issues that need to be addressed federally in the agriculture industry, passing the USMCA is the most important thing Congress can do. 

“There’s a level of frustration that Congress has not acted on the USMCA,” Naig said. “On the other hand, I know that there’s a political process that has to play out. The fact is, you got Democrats [controlling] the House, Republicans [controlling] the Senate and the Trump administration, and split party control like that — that means you need to work through the political process.”

Naig said he would also like to see Congress invest more in rural broadband coverage and address labor needs in agriculture in the broader context of immigration reform.

“Ultimately, though, we want Congress to take action,” Naig said. “And so there’s a time for talk, and then there’s a time for action. So I think at some point, we need Congress to step up and do the right thing.”

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