Throughout his campaign, President Trump relied heavily on the promise that he would create more balanced trade for the United States, which would then result in more domestic manufacturing and more domestic jobs. Unfortunately, the details of NAFTA 2.0 could do just the opposite according to various industry insiders.
Tangentially, many of the newly proposed automobile industry provisions – the crux of the deal – come at the same time that automobile industry is suffering its worst slowdown since the financial crisis, as reported earlier.
There are other nuances: as Bloomberg notes, the new agreement still needs to be approved by Congress and already has critics from both sides of the aisle. Mickey Kantor, who helped usher in NAFTA in under Bill Clinton as his trade representative told Bloomberg “It will cost us jobs,” arguing that Trump was doing it “mainly to fulfill a political philosophy rather than create jobs.”
In a separate analysis, looking at the financial impact of the proposed NAFTA overhaul, Goldman Sachs wrote in a report last night that they “…do not expect the revised terms to have substantial macroeconomic effects in the U.S. if they do take effect.”