WASHINGTON (Reuters) - The head of the U.S. Chamber of Commerce said on Tuesday that economic gains made through tax cuts and the lifting of business regulations would be undone if the United States canceled trade deals, including the North American Free Trade Agreement.
“Withdrawing from NAFTA would be a grave mistake,” Tom Donohue said in his annual address on the state of American business. “The American economy has taken several big steps forward with regulatory relief and tax reform, and the administration deserves lots of credit. But a wrong move on NAFTA would send us five steps back.”
The U.S. Chamber was a major driving force behind congressional passage of a big tax overhaul signed into law last month that included tax cuts for companies. The country’s largest business lobbying group is now turning its attention to other priorities, including immigration, trade, infrastructure and overhauling the nation’s social programs.
President Donald Trump’s Republican administration is negotiating with NAFTA partners Canada and Mexico to get the 1994 deal reworked so it better serves U.S. interests. Trump has said Washington will withdraw from the agreement if that cannot be achieved.
If Trump did decide to withdraw, Donohue said he expected that Congress would be motivated to act during the six-month review period that would be required before the deal could be fully terminated.
“You might get the idea that Democrats and Republicans alike would be very motivated by that move,” Donohue said.
He repeated the Chamber’s call for passage of a fix to protect from deportation so-called “Dreamers,” young people who as children were illegally brought into the country by their parents. The Trump administration rescinded Obama-era protections for Dreamers last year, and Congress is working to find a solution.
“These hard-working individuals contribute their talents to our economy in integral ways, and we will lose them if Congress doesn’t act early this year,” Donohue said.
Donohue described the federal programs like Medicare and Social Security as endangering the nation’s fiscal health, saying, “There is no greater threat to our country’s long-term economic security than unsustainable entitlements.”
Donohue also said the Chamber was pushing to see Congress pass an infrastructure package this year - a legislative priority that Trump said he would like to see done as soon as possible.
“We have the political will, the bipartisan support - and we certainly have the need.” he said. “Now it’s time for action.”
Looking ahead to congressional elections in November, Donohue said the Chamber would continue to weigh in on primary contests with an eye to achieving its policy goals. The Chamber was on the losing end of a contentious Republican primary fight in Alabama ahead of a special Senate election last month that was won by a Democrat.
Reporting by Ginger Gibson; Editing by Frances Kerry