One of the prime reasons we have such a trade imbalance with China is that China manipulates the value of their currency. That makes manufacturing in China less expensive than it is in other industrialized nations and exporting to China more expensive. This is an unethical practice that violates the terms of our trade agreements, but to date, the US has taken no punitive action. A bill to correct that appears to be sailing through the Senate, but can it survive the powerful forces arrayed against it?
Senator Charles Schumer said overwhelming support has emerged in the Senate for legislation letting U.S. companies seek duties on imports from China to compensate for the effects of a weak yuan.
“This bill is on a fast track for passage in the Senate,” Schumer, a New York Democrat, said today on a conference call with other lawmakers. “Once it passes the Senate, it’s going to be hard for the House to block it. I’m optimistic this bill can get to the president’s desk.”
The Senate is scheduled to debate the legislation next week. Besides Schumer, senators backing the bill include Democrats Sherrod Brown of Ohio and Debbie Stabenow of Michigan and Republicans Lindsey Graham of South Carolina and Jeff Sessions of Alabama. Lawmakers have said a weak currency gives Chinese companies an unfair advantage against U.S. manufacturers and cost more than 2.8 million jobs since 2001.
Schumer proposed similar measures penalizing the world’s second-largest economy in each of the past six years. None received a Senate vote… [emphasis added]
Inserted from <Business Week>
According to this article, it appears to be a done deal, but there is another side to the story, an extremely rich side.
The influential Club for Growth is pressuring Republican presidential candidates and lawmakers to oppose bipartisan legislation cracking down on China’s currency policies.
The anti-tax, free-market group on Thursday called on GOP presidential contenders to take a stand against the bill, authored by Democratic Sens. Sherrod Brown (Ohio) and Chuck Schumer (N.Y.), that would slap tariffs on imports from China and other countries that artificially keep their currency low.
But the real target may be Republican senators — and presidential contenders — who are leaning in favor of the bill.
The Club for Growth has urged lawmakers to vote no on the bill, warning that the vote will be included in the group’s 2011 Congressional Scorecard, used to measure how fiscally conservative they are.
“Sherrod Brown’s bill would result in higher costs to American consumers, and would be devastating to economic growth,” Club for Growth President Chris Chocola said in a statement. “Starting a trade war with China will have no winners and many losers. The Club for Growth instead urges Congress to pass pro-growth legislation that will reduce the cost of doing business so we can create more jobs here.”… [emphasis added]
Inserted from <Politico>
And who is this Club for Growth? They are made up of mostly Banksters and hedge fund managers, who profit on speculation and the inequality that depresses wages here. Here’s an oldie with Ed Schultz and Jon Nichols in Fitzwalkerstan to explain who they are.
In short, Club for Growth just a very powerful group of extremely high-end Koch suckers.
I expect that Republicans will block this needed bill. When they do, you will know why.
12 Responses to “Will a bill against China’s currency manipulation survive?”
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“Starting a trade war with China”???
Well, we already know that “class war” only exists when the non-wealthy classes starts fighting back. I guess a “trade war with China” only exists when the United States starts fighting back.
Excellent angle!!
This whole trade deficit with China (especially, though we run at a disadvantage with EVERY country) that saps our wealth with their cheaply made tainted products has been going on for three decades. Their major protective barrier is not the reluctance to make the Yuan float like all other currencies do, but rather a series of trade disputes heard at the governing body of the WTO which usually decides in China’s favor because they are still considered (hahahahahahaahah) a developing nation. The second part is they refuse to adhere to that same body’s rules concerning FAIR trade. They close their markets not through blockades but rather import tariffs that no other “Developed” nation is allowed to charge them for their crap.
The other side of this equation is that American owned business will not bring jobs back to this country until we do away with the $7+ minimum wage and have most of the workforce at around the $5 range. It is no longer a necessity to pay a worker enough money to afford the goods he produces because if sales over seas are great because our currency is weak and we can charge less then the profits roll in from both direction, labor and sales. Again another trick of the “small” business’ that employ thousands want to use to make “America competitive again” That is if we are not too “soft” for Obama to lead us to fight back.
There comes a time where a trade war is beneficial, keeping Chinese made shit out of our country is one of those times which would force importers out of business or to create manufacturing companies that keep jobs and profits here for taxation. But what we really need is to KILL THE GLOBAL ECONOMY which may just be happening if the EU crashes.
Mark, I disagree about killing the global economy, because I don’t see how we can do so without killing our own in the process. But I fully agree that we need to protect American workers by imposing a strict tariff on imports.
Look– if it is good for the country and the Dems– ie Obama back it– they will refuse cooperation and/or activley oppose whatever the idea might be
Exactly, Phyllis!
If it’s good for the country, they will oppose it.
Exactly, Patty!
The only growth “Club for Growth” REALLY supports is a growth in corporate and CEO profits. This disgusting group of liars consistantly supports anti-job anti-worker, and anti-consumer safety bills, and is nearly as dangerous as ALEC. They do NOT represent the best interests of most Americans, no matter what they claim!
As thou sayeth, Pope Jack!
” . . . Club for Growth President Chris Chocola said in a statement. “Starting a trade war with China will have no winners and many losers. The Club for Growth instead urges Congress to pass pro-growth legislation that will reduce the cost of doing business so we can create more jobs here.”… ”
So he’d like people to believe. Their record is clear — they are not creating American jobs, only big profits at the expense of American workers. Go the opposite direction to these high flying lunatics. The only pro-growth is the growth in profits. China has to be held accountable for their own actions and they cannot have everything their way. It goes back to what Infidel says “. . . a “trade war with China” only exists when the United States starts fighting back.” Well boys and girls, put on your long pants!
That’s it