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Strong Action Needed to Stem Record Trade Deficit with China |
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Even though the value of the dollar is declining, which means our trade deficit is dropping with most countries, the deficit with China once again hit a record. The U.S. Census Bureau reported that in the first 11 months of last year, the United States racked up a staggering $237 billion trade deficit in goods with China—11 percent higher than in the same period last year.
AFL-CIO Secretary-Treasurer Richard Trumka is calling for strong action to rein in the deficit with China: China continues to violate the rules of the global trading system—manipulating currency, violating workers’ human rights and providing illegal subsidies to businesses.
President Bush refuses to take action, fiddling away while the U.S. economy burns. With a do-nothing President, these figures reiterate the need for strong action by Congress.
The AFL-CIO is supporting H.R. 2942, the bipartisan Currency Reform for Fair Trade Act of 2007, introduced by Rep. Tim Ryan (D-Ohio) and presidential candidate Rep. Duncan Hunter (R-Calif.). Several Democratic candidates, including Sens. Hillary Rodham Clinton (D-N.Y.) and Barack Obama (D-Ill.), former Sen. John Edwards (D-N.C.) and Rep. Dennis Kucinich (D-Ohio) also have called for tough actions against China for its currency manipulation and failure to protect workers’ rights. Check out the candidates’ position on trade here.
Overall the U.S. trade deficit in goods and services grew 9 percent in November 2007 to $63.1 billion, putting the country on track once again to top the $700 billion mark in 2007. China now accounts for 32.5 percent of our total trade deficit in goods—and more than half of our non-petroleum goods deficit through the first 11 months of 2007.
Overall, the United States lost more than 212,000 manufacturing jobs in 2007, adding to the more than 3 million lost since President Bush took office in 2001. Many of these jobs disappeared when domestic businesses shifted jobs overseas or shut down because our tax, trade and currency policies put them at a competitive disadvantage.
One reason for the huge trade deficit is the policies of corporations like Wal-Mart. Wal-Mart is the nation’s top importer of Chinese-made products. The Economic Policy Institute (EPI) reports the giant retailer’s reliance on cheap goods made in China has cost this country nearly 200,000 jobs since 2001. Retailers such as Wal-Mart also put so much pressure on suppliers to produce cheap goods that health, environmental and labor protections get brushed aside.
In 2006, the annual report of the U.S.-China Economic and Security Review Commission (a bipartisan, congressionally appointed commission) provided evidence that backs up conclusions in the AFL-CIO’s Bush administration report card on China and a Solidarity Center study on workers’ rights in China.
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