Las Vegas chamber representatives came to the nation’s capital last week to advocate for a new trade agreement with Canada and Mexico, but Nevada delegation members expressed concerns about worker protections and election-year politics holding up the deal.
The chamber also heard from delegation members about the trade war with China, which they said is hurting Nevada businesses who rely on imports. And leaders of the state’s largest business group, during their annual pilgrimage to Washington, D.C., also announced progress on building coalitions to push for constructing I-11 and expressed enduring concerns about widening the I-15 corridor to California.
Nevada stands to benefit from a trade deal between the U.S.-Mexico-Canada, known as the USMCA, according to the Office of the U.S. Trade Representative.
Mexico and Canada are the state’s two largest trading partners and in 2017 Nevada sent a total of $1.7 billion in exports to those countries, including $1.1 billion to Canada and $606 billion to Mexico.
“Trade and exports in Nevada supports 39,000 jobs,” Paul Moradkhan, the chamber's senior vice president for government affairs, said in an interview. “Without the trade agreement, you could potentially lose those jobs and take a hit on the [state] economy. So we believe open trade agreements are beneficial for the business community.”
Sen. Catherine Cortez Masto said that Nevada’s dairy farmers stand to gain from the deal, which would allow greater access for U.S. dairy products to the Canadian market.
“There are some good things in it, particularly for our dairy farmers,” she said in a brief interview.
Moradkhan said that the chamber “is hopeful that Congress approves the deal in the fall,” adding that Mexico approved the proposal in June. But the timing of a vote in Congress remains unclear as House Democrats continue to negotiate with the White House.
“I’m hopeful,” House Speaker Nancy Pelosi told reporters about the deal Thursday.
Enforcement of the terms of the deal, including strengthened labor provisions designed to put Mexican workers more on par with American workers, remains a sticking point. Labor gains under the USMCA include passage of a law by the Mexican government that gives workers the right to vote on unions and their labor contracts through secret ballots.
But Democrats remain concerned over whether Mexico will be able to implement and enforce the new law, enacted earlier this year.
“If you can’t enforce the provisions in any treaty, then you really are not protecting American workers,” Pelosi said.
Other Democratic concerns include a provision in the deal that would give 10 years of marketing exclusivity for biologic drugs, which they argue would keep drug prices high for cancer treatments for other ailments. Environmental protections in the pact are also an issue for Democrats. They have been criticized as too lenient by environmental groups and the USMCA does not address climate change.
Members of the Nevada delegation are generally on board with enacting a deal, but Democrats want to see the final language before pledging their support.
“We’re trying to get to ‘yes’ on an agreement, but there are several points of contention,” said Rep. Susie Lee, citing the issues raised by Democrats.
“We’ve been very clear that we needed to see a change of what the original proposal was,” she said. “That’s all being negotiated now. I think there’s a hope to get it done by the end of the year, if not sooner.”
Waiting until next year would make the already difficult task of enacting an agreement even harder with a presidential election in November.
Rep. Mark Amodei, the lone Republican in the delegation, was also hopeful of congressional action. He praised Mexico for strides the nation has made in building up their middle class and was skeptical of Congress regulating the labor force.
“The Mexican economy and the ability to build a middle class is way, way up,” Amodei said, adding that the U.S. was allowed to regulate its labor force without the input from foreign governments.
“Listen, if there’s workers’ problem, by all means, but that’s something that we’ve been allowed to solve ourselves,” he said.
The push to pass USMCA comes as the president’s trade war with China threatens economic gains made during his administration—a key plank in Trump’s 2020 re-election campaign.
The chamber has not taken a position on the matter, but some lawmakers discussed it in their meetings with the group.
Rep. Dina Titus said she has heard concerns from brewers regarding the tariff on aluminum increasing the production cost. She said using glass bottles doesn’t help because the increased weight drives up transportation costs.
She also said candy manufacturers are caught up in the fight because they source silver wrapping paper in China, and recreational vehicle manufacturers and private aircraft producers who import parts from abroad have been affected. Slot machine producers have also been affected, she said.
“This trade war is not good for anybody,” Titus said, adding that she visited China over the August recess.
Trade talks with China are set to resume Oct. 1, but a trade deal could be some time away, if at all.
Cortez Masto told the Las Vegas chamber about her meeting last month with the Reno-Sparks Chamber of Commerce where she hearing from a number of Nevada businesses on China.
“A majority are being negatively affected either by the imports they need for their businesses or their exports,” she said.
Nevada businesses are also concerned whether those markets are lost for good as buyers turn to other, less expensive, sources of goods caught up in the trade spat.
“Once we do get an agreement, their buyer is going to be gone,” Cortez Masto said of the concern she heard from one dairy farmer.
I-11 has been a priority for the chamber in recent years, but this year the group also pushed for the widening of I-15 into Southern California and a high-speed train that would run along that corridor.
“If you have ever been on I-15 on a weekend or a holiday, it’s just a traffic jam,” said Mary Beth Sewald, Las Vegas chamber president and chief executive officer. “Almost 20 percent of Las Vegas’ tourism comes from Southern California.”
The group had no immediate cost estimates for widening I-15 and is just ramping up its campaign. They also support Virgin Trains’ $4 billion bid to build a high speed rail line between Victorville, California, which is located about 85-miles northeast of Los Angeles, and Las Vegas. The-185 mile rail line would run along I-15 and construction is targeted to begin next year.
But it’s I-11 that is furthest along among the group’s transportation priorities. Supporters see the road as an economic engine for the region, but also ultimately as a key link in an important trade corridor connecting to Canada and Mexico.
The chamber also announced a new coalition with the Arizona Chamber of Commerce to organize regional chambers along the corridor to advocate for the project, which Nevada has built from Las Vegas to the state line with Arizona. The Copper State is working to upgrade existing roadway to interstate standards, eventually connecting Phoenix to Las Vegas.
“I represent the heart of Las Vegas and I often say we don’t make anything there except perhaps dreams come true, so we have to bring everything in,” Titus said at the chamber event. “Everything has to come from somewhere else, so transportation is so important to our district. Having I-11 connect Las Vegas and Phoenix, the only two cities in the country that are left not connected by an interstate, would be really important.”
Titus, who serves on the House Transportation and Infrastructure Committee and is co-chairman of the I-11 Caucus, noted that Congress will have to renew the law governing the nation’s transportation policy before it expires next year and that advocacy of the chamber and other supporters will be needed to ensure robust funding for the nation's highways and the I-11 project.
“As we go into the reauthorization of the highway bill next year, let’s look for as many opportunities as we can find to put pieces in there that help advance the project,” Titus said.
In the Senate, Rosen said she plans to work closely with Arizona Democratic Sen. Kyrsten Sinema. Both serve on the Senate Commerce, Science and Transportation Committee, which has jurisdiction over highway safety.
“We sit next to each other and we are working on this as well,” Rosen said at the event.
Nevada is also well-positioned to influence the highway measure with Cortez Masto and Rep. Steven Horsford both holding seats on the Senate Finance Committee and House Ways and Means Committee, respectively. The tax panels will have an important role determining financing for the highway program.