Nixing NAFTA: Trump Might Not Have as Much Power as He Thinks

Congress may have final say on the trade deal.


Al Drago/CNP/AdMedia/Newscom

President Donald Trump has made it clear he's willing to terminate the North American Free Trade Agreement, but legal experts aren't sure he has the authority to do so.

Under the U.S. Constitution, Congress is given the power to "regulate commerce with foreign nations," suggesting it has the a final decision on NAFTA. Article II of the Constitution, however, grants the president the power to conduct foreign policy.

Is NAFTA is a foreign or commerce treaty? Most legal academics believe the power should reside with Congress, according to Scott Lincicome, adjunct scholar at the Cato Institute, a free market think tank based in Washington, D.C.

NAFTA is technically a congressional-executive agreement and not a treaty, leading some to believe that it falls under congressional power to regulate foreign commerce.

"The thinking on this is, look, this isn't a standard treaty that falls far more clearly under the foreign affairs powers of the president and constitutional provisions on treaties," Lincicome said at a recent Cato event.

To justify his potential executive action, Trump has pointed to NAFTA's Article 2205, which says the country can withdraw from the trade agreement in six months after providing written notice.

Yet Bill Reinsch, a distinguished fellow at the Stimson Center, expressed skepticism in remarks made at Cato recently that Trump alone can trigger Article 2205.

"The [NAFTA] statute is quite clear that the United States could withdraw, but the statute doesn't go beyond saying who the United States is." Reinsch said.

The issue of withdrawal is written ambiguously into NAFTA. It does not speak to whether the legislative or the executive branch has the power to take that first step.

Even if Congress has the final authority on pulling out, the president has significant control over other aspects of the treaty, and could do significant damage to the deal, Jon R. Johnson, a senior fellow at the CD Howe Institute, a Canadian policy think tank, wrote in January.

Johnson, an advisor on international trade to the Canadian government during the original NAFTA negotiations, said that when Congress approved NAFTA in 1993, it left enforcement of tariffs to then-President Bill Clinton. Johnson believes that given the track record of Congress in delegating authority to the executive branch, Trump could raise tariffs.

"Congress has delegated powers to the president to act unilaterally to address national emergencies and balance-of-payments and national security situations. These powers include the ability to raise tariffs and to adopt other border measures." Johnson wrote.

Ultimately, Trump may have to settle for halfway measures, and not because the legal arguments could prove difficult. Terminating NAFTA would be controversial. According to a Gallup Poll, 48 percent of Americans support the trade agreement. Only six percent favor outright withdrawal.