From the pork products that come from Kansas to the soaps made in Ohio, the specter of retaliatory tariffs looms large among the Midwest’s economic sectors that rely on trade with Canada and Mexico. Many of the affected industry groups continued in early 2019 to try to get their voices heard among U.S. trade leaders.
One of their latest outreach efforts: A letter signed by a diverse group of more than 40 organizations — including the National Corn Growers Association, the U.S. Chamber of Commerce, the National Pork Producers Council and the Association of Equipment Manufacturers — urging a return to “zero-tariff North American trade.”
The U.S. Tax Cuts and Jobs Act, which became law in December 2017, included a $10,000 cap on the deductibility of state and local taxes from federal taxes, the so-called “SALT deduction.” Prior to the 2018 tax year, there was no cap on the deductibility of state and...
Following more than a year of negotiations, and many days when it seemed as though talks would fail, Canada, Mexico and the United States reached agreement on a trilateral trade pact on Sept. 30. The deal has a new name — the United States-Mexico-Canada Agreement, or USMCA — and some new provisions, but also is notable for what it keeps in place.
“About 70 percent is the same [as the North American Free Trade Agreement],” notes Chad Hart, an associate professor of economics at Iowa State University. “What this means is that the rules we have been playing under for the last 20-plus years have been reaffirmed, and this adds market certainty.”
Following Nebraska’s first execution of a death-row inmate in 21 years, some legislators are calling for statutory revisions that would change who witnesses the death and what they are able to see. “If the state is going to do something as serious as taking a person’s life, we need to be transparent,” Nebraska Sen. Patty Pansing Brooks says.
Carey Dean Moore was put to death on Aug. 14 for the murder of two cabdrivers nearly 40 years ago. He died by lethal injection, the first time that Nebraska used this method of execution. (In 2008, the state Supreme Court ruled electrocution to be unconstitutional.) The four-drug combination used by Nebraska had never been used by any other state: a sedative, an opioid pain killer (fentanyl) and a paralyzing drug, followed by potassium chloride, a drug that causes heart failure.
Big changes are coming to Wisconsin’s juvenile justice system in the years ahead, with a $80 million infrastructure investment that will shift how young offenders are housed and treated.
“We are no longer going to have to rely on a huge, one-size-fits-all system,” says Evan Goyke, one of the legislators who led the work ahead of this year’s passage of the transformative AB 953. (Wisconsin Gov. Scott Walker supported the bipartisan, bicameral effort.) “We are adapting our system and taking a smaller, regional approach to juvenile facilities.”
When countries enter a trade war, its effects depend in part on how close the nations are, in terms of geography and their existing economic relationship, Dan Ciuriak, a former Canadian government economist who now runs a consulting firm, told a committee of state and provincial legislators in July.
Few, if any, two nations in the world are more closely knit than Canada and the United States — a fact that would seem to point to major economic consequences if the two countries’ use of tariffs and retaliatory tariffs continues to escalate.
Recent headlines have pointed to some of the strains (a mix of new tensions and a flare-up of longstanding conflicts) in the U.S.-Canada relationship. There have been proposed U.S. tariffs on steel, harsh words exchanged on Canadian dairy policy, and threats by President Donald Trump to end the North American Free Trade Agreement.
But dig a little deeper, and a much different story emerges — one of economic interdependence and cooperation in key areas such as energy and the environment.
“The relationship at the provincial-state level is probably as strong, if not stronger, than it has been since the mid-1980s,” says Carlo Dade, director of the Canada West Foundation’s Trade and Investment Centre, pointing, in particular, to the deeper relations built between state governors and provincial premiers.
Canada and the United States share much more than the largest binational border in the world; their peaceful relationship has contributed to economic growth in both countries as well as to the development of an intricate, integrated trading partnership.
“We are moving away from just being trading partners; now we are business associates that build things together and sell the finished products both domestically and around the world,” notes Christopher Sands, director of the Canadian Studies Program at the School of Advanced International Studies at Johns Hopkins University.
This thriving cross-border supply chain is one of several critical pieces of the U.S.-Canada relationship, and much of it is centered in the Midwest.
When President Trump announced that he intended to levy a 25 percent tariff on imported steel, and a 10 percent tariff on imported aluminum, U.S. trade partners were surprised — and angry.
His actions came after a U.S. Commerce Department report found that the unfair “dumping” of steel and aluminum (exporting these products to the United States at below domestic market value) by other countries was leading to plant closings and job losses. This has been deemed by the Trump administration a threat not only to domestic manufacturing, but also to national security.
At first stating that there would be no exceptions to the tariffs, Trump stepped back from that position by the time of his formal declaration. He exempted Canada (the largest exporter of steel and aluminum to the United States) and Mexico from the tariffs, at least temporarily.
For the many integrated industries in the Midwest that rely on cross-border trade, such as the auto sector, this exemption was particularly important.
Negotiators from Canada, Mexico and the United States have begun their seventh round of discussions for a new, or modernized, North American Free Trade Agreement. And while the dissolution of NAFTA seemed very likely several months ago, negotiations are still alive.
The E-Verify program allows employers to check whether newly hired workers have authorization to work in the United States. Undocumented immigrants are not eligible to work, nor are many people in the country here on short-term visas. Created in 1996 through federal legislation, E-Verify is an internet-based system that uses data from the Social Security Administration and Department of Homeland Security; verification can be instant, and rarely takes more than 24 hours. Individuals who receive “tentative non-confirmations” can challenge the finding.
There is no federal requirement for employers to use E-Verify (they do have to collect and verify I-9 forms), and one criticism is that people with fraudulent documents get through the system. The federal government does very few audits, so there is little enforcement of verification requirements. Still, a number of states have requirements of some kind for employers to use E-Verify (even minus such a state law, some employers use the system; see map).