Time for Congress to Act on China’s Economic Repression

[Omaha Steve]

http://blog.aflcio.org/2007/02/02/time-for-congress-to-act-on-china%e2%80%99s-economic-repression/

Time for Congress to Act on China’s Economic Repression

by James Parks, Feb 2, 2007

The Bush administration’s failure to aggressively act to stop China’s systematic repression of workers’ rights and human rights, currency manipulation and export subsidies has led to record trade deficits and the loss of thousands of jobs in the United States. Now it’s time for Congress to do something to protect U.S. workers from the impact of China’s policies.

Testifying before the Senate Committee on Banking, Housing and Urban Affairs this week, AFL-CIO Secretary-Treasurer Richard Trumka said:

Every year, I or one of my colleagues is invited to testify on these important economic issues. Every year, the trade deficit worsens, more jobs are lost and the economic pressures on workers and the middle class continue to grow. And every year, someone from the administration responds with pledges of increased dialogue and cooperation.

The AFL-CIO, U.S. manufacturers and many experts maintain that China deliberately undervalues its currency, the yuan, to keep its value artificially low so it can export products at an artificially low price—running up the U.S. trade deficit and costing good American jobs.

The 109th Congress did not act on a bill introduced by Reps. Tim Ryan (D-Ohio) and Duncan Hunter (R-Calif.), which would have given the government new tools to address currency manipulation and would clarify that such manipulation is an illegal subsidy under World Trade Organization (WTO) rules. The Bush administration’s U.S. Trade Representative also rejected a petition by the AFL-CIO and business and farm leaders that asked the president to take action to curb China’s currency manipulation.

The first step in getting the nation’s policy on China moving in the right direction, Trumka said, would be for this Congress to immediately consider and pass the Fair Currency Act (H.R. 782), which Hunter and Ryan reintroduced Jan. 31.

An AFL-CIO report shows China’s fixed currency rate artificially lowers the price of its goods by 40 percent and subsidizes exports, putting U.S. companies at a disadvantage. The lack of currency flexibility has been a major factor in U.S. job losses and a trade deficit with China that experts predict will exceed $230 billion this year.

Yet, Treasury Secretary Henry Paulson, who has traveled several times in the past few months to China without gaining a single meaningful concession in China’s economic or human rights policies, testified before the Senate committee that China is not manipulating its currency. Paulson’s testimony prompted this response from Trumka:

Either there is something wrong with the criteria Treasury is using to determine currency manipulation, or there is something wrong with the Treasury Department’s math.

I would like to ask Secretary Paulson and his staff exactly what it would take for Treasury to find that a country had in fact manipulated its currency, and–perhaps more important–what it would take to move beyond yet another round of endless diplomacy and strategic dialogue to concrete action and results.

FULL story at link.