From NAFTA to USMCA and the Evolution of US Trade Policy

Abstract

The Trump Administration has pursued a sharply different – and for its trade partners unsettling – trade policy from that followed by the United States in the postwar period. While much attention has been focussed on the oftentimes contradictory, oftentimes theoretically unfounded, and oftentimes undiplomatically aggressive manner in which that policy has been implemented, nonetheless, the policy contains a coherent if not necessarily desirable or achievable vision for the US economy. Moreover, the USMCA implements this policy in a systematic, lawyerly, iron-clad, and frankly brutal fashion. This note outlines the case for these claims and comments on the implications of the agreement for the future of the trading system -- and more particularly for the North American economies – as distinct from the North American economy.

Keywords: USMCA, NAFTA, US trade policy, Canada, Mexico

JEL Classification: F13, F15