How to Evaluate the Renegotiated NAFTA
Overview
The U.S.-Mexico-Canada Agreement (USMCA), President Trump’s 2018 revision to the North American Free Trade Agreement (NAFTA), misses the chance to place workers at the center of U.S. trade priorities. Congress should insist on an approach that does.
Introduction and summary
American workers’ real wages have been stagnant for decades. While a wide range of domestic forces have led to that outcome—from a decline in union coverage to the slow and uneven recovery from the Great Recession1—trade has also played an important role in generating economic stress. Capital is increasingly mobile across country borders, yet workers are not. Business, in effect, can level an ultimatum to workers: Accept what we offer, or we will outsource or move to another country where wages are lower. Millions of working families have personally experienced this threat in recent decades, and the resulting economic stress on many American workers—especially in the Midwest—has been significant.