U.S. House panel advances North American trade deal, sets up Thursday House vote

By David Lawder
U.S. Capitol building is seen on the morning of the 2018 U.S. midterm elections in Washington

By David Lawder

WASHINGTON (Reuters) - The U.S. House Ways and Means Committee approved a revised North American trade deal by voice vote on Tuesday, indicating likely broad support for implementing legislation in a House of Representatives floor vote on Thursday.

Only one of the tax and trade committee's 42 members voiced objection to the revised U.S.-Mexico-Canada Agreement during a four-hour committee debate. USMCA will replace the 26-year-old North American Free Trade Agreement if fully ratified.

Representative Bill Pascrell, a pro-labor Democrat from New Jersey, said he could not support the legislation because labor enforcement revisions did not go far enough in ensuring that Mexican workers would be treated fairly.

"Will this agreement do anything to raise wages for American workers? Doubtful by all accounts," Pascrell said. "Will these terms stop the offshoring of our jobs? They will not."

But other Democrats and Republicans on the panel largely praised a deal in which the three countries agreed to strengthen enforcement of the pact's labor rights provisions at the factory level.

"These changes set a new standard for U.S. trade agreements and demonstrate that trade agreements can achieve broad bipartisan support if they empower workers, protect patients’ access to affordable health care and improve our shared environment," said Ways and Means Committee Chairman Richard Neal, a Massachusetts Democrat.

The committee's voice vote moves President Donald Trump's three-year effort to rewrite NAFTA, a trade agreement he has blamed for the loss of millions of factory jobs, closer to becoming law.

The House floor vote on Thursday will follow a vote on Wednesday in the Democrat-controlled House on whether to launch formal impeachment proceedings against Trump.

Trump said on Tuesday that the timing of a U.S. Senate vote on USMCA is up to Senate Majority Leader Mitch McConnell. McConnell has said he may wait to stage the vote until after an expected impeachment trial for Trump, which would take place early in 2020.

Key changes negotiated in amendments include a new mechanism under which the United States and Canada can convene panels to review complaints that Mexican factories are denying labor rights, including the freedom to organize and collectively bargain.

The deal also eliminates a 10-year data exclusivity period for biologic drugs and other pharmaceuticals provisions that Democrats feared would raise prices.

U.S. Trade Representative Robert Lighthizer told Fox Business Network earlier on Tuesday that withdrawing a required 10-year-exclusivity period for biologic drugs was a "step backwards" and a "compromise" needed to win Democratic support.

"You know, there are consequences of the Democrats' control of the House. And that was necessary and I'm sorry about it," he said, adding that the trade deal should easily win approval in Congress.

Democratic Representative Earl Blumenauer, who chairs the Ways and Means trade subcommittee, said the drugs changes were important for Democrats.

"I think this is one of the reasons why we've been able to get the votes," Blumenauer said.

Mexico's Senate approved the trade pact last week. .

Canada could be the last of the three countries to ratify USMCA, Prime Minister Justin Trudeau said on Tuesday, citing the Canadian legislative calendar.

Canadian lawmakers are not due back from a winter break until Jan 27. Trudeau's Liberals lost their majority in an October election and must work more closely with opposition parties to push through legislation.


(Additional reporting by Andrea Shalal in Washington and David Ljunggren in Ottawa; Editing by Steve Orlofsky and Dan Grebler)