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Trump's Draft Proposal Makes Tweaks To NAFTA

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The Trump administration is gearing up for a rework of the NAFTA treaty between the U.S., Mexico and Canada. Commerce Secretary Wilbur Ross said Thursday the administration hopes to soon start the 90-day countdown clock to opening talks. A letter circulating on Capitol Hill suggests the administration may take a less extreme approach to negotiations than expected.

During the election campaign President Trump threatened to pull out of NAFTA, which he called the worst trade deal in U.S. history. But, a draft outline of the U.S. objectives from the Trade Representative's office suggests a more temperate approach, including goals on investment and labor that have enjoyed bipartisan support. Jeffrey Schott, of the Peterson Institute for International Economics, says the letter provides the basis for constructive negotiations. But, Schott says, "It also contains a few seeds that could poison those talks and disrupt and perhaps blow up those negotiations."

Among those "seeds" is a reference to tax fairness that could foreshadow conflict over the border taxes Trump has threatened to impose on Mexico, or the Border Adjustable tax supported by the House leadership that would levy a 20 percent tax on all imports.

Ross described the letter as "the very broad outlines of the topics we will be discussing." Ross said it did not represent a change in the administration's thinking.

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