Washington, DC Update: Soo Locks and Trade Policy

From March 13-14, 2019, the Chamber Alliance’s Director of Government Relations Kent Wood attended the annual Washington, DC fly-in with the Great Lakes Metro Chambers Coalition. While in the nation’s capital, Kent had the chance to meet with federal officials about a number of topics important to commerce in the Great Lakes region, including two topics of importance to northern Michigan’s economy.

Soo Locks

When the President Trump’s budget was released in early March, it included a $75 million appropriation for the Soo Locks and a pleasant surprise to members of the Coalition.

“I didn’t think we’d get anything in the budget for the Soo Locks,” stated Jim Weakley, Executive Director of the Lake Carriers’ Association. Weakley felt that, while the President has openly declared his support for adding a new large freighter sized lock in northern Michigan, that we wouldn’t see any appropriation for it initially in the President’s budget. “I’m more than happy to eat that crow one small bite at a time,” he joked.

The new lock project has an overall price tag just shy of $1 billion. While we don’t expect all of those funds to be appropriated at one time, we hope to expect similar appropriations over the life of the project. This means that, while the project currently continues to move forward at an exciting and historic pace, it will continue to require a consistent effort by advocates for a number of years to keep funding appropriated by Congress to move the project forward in a timely manner.

Trade Policy: United States-Mexico-Canada Agreement (USMCA) and Tariffs

Ambassador C.J. Mahoney, Deputy U.S. Trade Representative, and a key negotiator on the United States-Mexico-Canada Agreement (USMCA) was blunt in his assessment that he believes the USMCA needs to happen. The Deputy ambassador was addressing members of the Coalition about the need for the USMCA’s ratification by Congress, which, despite significant priority and outreach efforts from the Administration, is uncertain at this point.

USMCA is an update of the North American Free Trade Agreement (NAFTA) deal between Canada, Mexico and the United States that dates back to the mid-1990s. The Trump Administration made waves last year when they threatened to pull out of the decades-old deal if the three sides could not reach an agreement on an update.

According to the Ambassador, the agreement is very similar to NAFTA, but includes a number of concessions from Mexico and Canada that make the deal better for the United States, including raising labor standards in Mexico, a new section on digital trade, and stronger enforcement of Intellectual Property standards.

Officials expressed they were working to remove the tariffs as soon as possible, but stopped short of giving details about a firm deadline. They shared that they realized that some U.S. businesses were feeling the pinch from the tariffs, and promised they were working as fast as possible to reach an agreement. The President felt tariffs were the best way to address steel dumping and other trade violations from China that had been going on for years. The Metro Chambers Coalition also had some time with officials from the White House economic team, which has also been hard at work educating Congress on the new USMCA trade deal. Kent shared with officials the challenge for northern Michigan’s small and mid-sized manufacturing sector with the Sec. 232 Steel and Aluminum tariffs imposed by the administration last spring and asked for a timeline on when we could expect the tariffs to be removed.

You can have an impact by contacting the White House and talking about the importance of removing tariffs as soon as possible. Here is some more background.

You can continue to follow the work of the Great Lakes Metro Chambers Coalition here.