Congress finished 2019 with a burst of activity, narrowly averting a government shutdown and moving the long-debated and delayed U.S.-Mexico-Canada trade agreement (USMCA) one step closer to ratification. There was also progress on phase one of a U.S.-China trade deal, setting up additional negotiations in 2020.
FISCAL YEAR 2020 FUNDING RESOLVED
There is nothing like a deadline to spur Washington into action. With mere hours left before the government ran out of funding, Congress reached a bipartisan agreement on a $1.4 trillion FY20 federal spending package that will fund the government through September 2020. Up until the agreement, Congress had passed zero of the 12 appropriations bills, relying instead on continuing resolutions to fund programs at FY19 levels. In the end, the spending bills were all passed with most programs seeing an increase over FY19 levels.
The package includes $15.2 billion for the Department of Commerce, an increase of $3.8 billion above the FY19 level. Funding for NIST includes a $6 million increase for the Hollings Manufacturing Extension Partnerships. The National Science Foundation was funded at $203 million above the FY19 level for basic research across scientific disciplines to support the development of effective STEM programs. The Labor Department budget increased by $15 million, including $175 million for training programs that utilize the flexible and effective apprenticeship model. A rider to the legislation extended the EXIM Bank for seven years. AMT advocated for the bank’s extension. For additional details on appropriations, visit www.appropriations.senate.gov.
HOUSE APPROVES USMCA
In a major victory for manufacturers, the House approved USMCA, the president’s replacement for NAFTA, in the last days of the session. Ratification of USMCA is one of AMT’s top 2019-20 policy priorities. The trade pact advanced rapidly after concessions were made to Democrats seeking enforcement mechanisms for labor reforms. The implementing legislation now moves to the Senate. Senate Majority Leader Mitch McConnell has indicated he will not hold a vote until after the impeachment trial, which will last at least through January.
U.S.-CHINA REACH PARTIAL TRADE DEAL
The office of the U.S. Trade Representative (USTR) announced that the United States and China reached an agreement on phase one of a trade deal between the two countries. The agreement comes after a year and a half of tense negotiations that centered on major trade imbalances, including currency manipulation, access to markets, tech transfer, and IP theft.
Details of the pact are still being worked out, but the 15 percent tariffs scheduled to take effect on Dec. 15 on $156 billion in Chinese imports were delayed. In addition, USTR reported that the United States will continue to levy a 25 percent tariff on approximately $250 billion of imported Chinese goods, but tariffs on another $120 billion will be reduced to 7.5 percent. China agreed to buy $200 billion in U.S. goods and up to $40 billion in agricultural products. USTR Robert Lighthizer said he hoped the deal will be signed in January. Visit www.USTR.gov for additional information.
HAPPY NEW YEAR!
At AMT, we are looking forward to an exciting year ahead in Washington with action on the Manufacturing Mandate-focused areas of innovation, global competitiveness, and Smartforce. Those issues will be vying for lawmakers’ attention as the 2020 elections take centerstage. I’ll be connecting with you as it all unfolds.