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The U.S. International Trade Commission estimates that the new NAFTA would, six years after it came into force, increase US GDP by 0.35% ($68.2 billion) and increase employment by 0.12% (176,000 jobs). So: a positive impact, but small. usitc.gov/publications/3…
Notably: Trump's most frequent talking point about the new NAFTA is that it'd bring car production back to the U.S. The Commission finds that there'd actually be a job *loss* of 1,500 in automobile production -- though a gain of about 30,000 in auto-parts production.
Early take on the report:
- Gives supporters of the deal some ammunition (positive impact!)
- Does little to add pressure to deal skeptics (impact is small!)
- Rejects Trump's claims that the deal will is a massive departure from NAFTA and will bring back auto plants en masse
- Gives supporters of the deal some ammunition (positive impact!)
- Does little to add pressure to deal skeptics (impact is small!)
- Rejects Trump's claims that the deal will is a massive departure from NAFTA and will bring back auto plants en masse
Everyone should be skeptical of everything, but the ITC does its research independently of the governing administration, and I've seen no suggestion from anyone that the Trump team interfered here.
USITC on the new NAFTA: "The model estimates that the agreement would likely have a positive impact on all broad industry sectors within the U.S. economy."
As always, ITC estimates about the USMCA depend on the assumptions of the ITC model.
Example: if USMCA items that "reduce policy uncertainty" have no impact, the deal has a negative effect on GDP and jobs. If those items have a "moderate" impact, the deal has a positive effect.
Example: if USMCA items that "reduce policy uncertainty" have no impact, the deal has a negative effect on GDP and jobs. If those items have a "moderate" impact, the deal has a positive effect.
Trump has touted the new NAFTA as a boon to the US auto factories. Here's the US International Trade Commission's estimate of its effects on US auto production:
