I have spent more time blogging about the U.S.-Mexico-Canada (USMCA) free trade agreement than the average 12-year-old in Tijuana spends selling bootlegged cigarettes to tourists. At first I was severely bummed to be writing about the same thing again, but then I remembered how much fun this mess of a treaty has been. That is because USMCA has been (1) very meaningful for political hardos — USMCA is pretty much the only chance Trump has to flex on Congress and move some legislation with weight before the 2020 election; and (2) this price action in the USMCA market has been insane. Basically the only thing that has swung back and forth as wildly as the cost of a USMCA “Yes” share was Dennis Rodman’s sexuality in the ’90s.
What is the update?
The most recent news out of the White House is that Jared Kushner and his assistant, Richard Lighthizer, are flying south to sign a new agreement with Mexico and Canada. Anyway, lots of people have been yapping about how this means the USMCA trade agreement is 100 percent finished and it is only a matter of time before Congress gives it the old rubber stamp. As usual, I think this is fake news. The “YES to 99” battle cry is only thinking about half of the question, which is when Nancy “G.O.A.T.” Pelosi gets off of her behind to schedule a vote. But Mitch McConnell aka Cocaine Mitch is currently trying to land more shipments of must-pass bills on the Senate airfield than there is capacity.
This is the list of things Congress has to do before adjourning for Christmas, in order of urgency:
(1) Pass some kind of government funding bill;
(2) Impeach Donald Trump;
(3) Finish the Defense Authorization;
(4) Pass USMCA;
(5) Return to confirming conservative judges and passing dumb Green New Deal-adjacent bills in the House.
How tight is the schedule?
There are NINE working day left before target adjournment. Here is the timetable for how many of those are needed for USMCA to pass:
DAY ONE – Tuesday, Dec 10
— U.S. Mexico and Canada agree to updates. Diplomats crank some Coronas to celebrate (it is ‘Rona SZN).
— Deal put into legislative text (this is prob already in progress).
— Staffers in House and Senate rip Addies and read bill all night, prep materials for hearings.
— Nancy Pelosi cancels hearings and sends bill straight to the floor.
DAY TWO – Wednesday, December 11
— House debates and passes USMCA, goes back impeaching Trump.
DAY THREE – Thursday, December 12
— Senate Debates and votes on USMCA.
— Bernie Sanders gives a long speech about why free trade is garbage.
— Trump has a v. awkward press conference with Mexico and Canada before signing bill.
— Somewhere in Wisconsin Paul Ryan rubs one out while Trump signs new free trade agreement. Very naughty!
— Moderate Dems and Chamber of Commerce Republicans flood Twitter with boring takes about how free trade creates jobs.
HOWEVER — there is probably more that needs to happen. We probably need to budget a little more time. Perhaps as much as —
DAY 3 +1 – Friday, December 13
House and/or Senate Committee holds hearings on USCMA.
DAY 3 + 2 – Monday, December 16
House and/or Senate Committee hearings on USMCA.
So 3-5 days to get it done. But, ruh-roh!!!!
Day four is Friday, December 13!!! On this day, it’s going to be getting hot AF in Congress because– remember — USMCA is still up against funding the government, passing a defense authorization, and impeaching Trump. And to make it even worse, Congressional Appropriators have been flapping their jaws about how they want to do all 12 budgets bill in regular order… not by a one-off continuing resolution!! 12 approps bills in 2 weeks!!???
Do I think they can pull this off? Idk. But moving more than a handfull of bills through regular order could rip victory right off YES holders’ hands at the 11th hour Gollum-style.
12 Approps bills, an NDAA— big problem for USMCA.
Usually it’s safe to bet that Congress will do the easier thing though. That version is:
Congress gets lazy and does a short term CR — YES HOLDERS—
But what do you actually think, Keendawg?
I am glad you asked. Here are a summary of my findings:
THE CASE FOR NO:
(1) Nancy Pelosi has more legislative priorities than pairs of dentures right now;
(2) Cocaine Mitch has very limited floor time.
(3) The only people who get boned if this bill moves to 2020 are; (1) small business holders and farmers; and (2) moderate Dems in swing seats. You know what Cocaine Mitch is thinking:
(4) USMCA is realistically the only must-pass bill that can wait to 2020, so if things get jammed-up, it’s the first to go.
(5) House Dems could always get stage fright.
THE CASE FOR YES:
(1) There is bipartisan interest and excitement behind USMCA;
(2) There is, at least as of Monday, enough game clock left to get it done.
As I said in my last few posts, I’ve been laying off my NO position around 80 cents for the past few weeks. I still have a tiny stake left in this market:
But here’s the truth. We’re not gonna get a short term CR. Congress is going all the way.
USMCA IS DEAD IN 2019.