Report: China Rigs Subsidies, Manipulates Currency
Dave Johnson, a fellow at the Campaign for America’s Future, sends us this.
The new U.S.-China Economic and Security Review Commission report on China should be a “wake-up call” for the United States, says Scott Paul, director of the Alliance for American Manufacturing (AAM). Click here to read the full report and here for a comprehensive list of the commission’s recommendations beginning on page 355 of the report.
In sum: China is rigging trade using subsidies and currency manipulation, has barriers to bringing in U.S. goods and is forcing American companies to hand over proprietary technology. The result is our huge trade deficit is getting even worse. China also is acting more like it could become a national security threat.
This bipartisan commission was created by Congress in 2000 “to monitor, investigate and submit to Congress an annual report on the national security implications of the bilateral trade and economic relationship between the United States and the People’s Republic of China and to provide recommendations, where appropriate, to Congress for legislative and administrative action.”
Some key excerpts:
Senate Votes Today on China Currency
The U.S. Senate today will vote on a bill (S. 1619) to hold China accountable for its job-killing practice of currency manipulation. According to new data, 2.8 million American jobs were lost or displaced over the past decade due to the growing U.S. trade deficit with China—fueled by Chinese currency manipulation. (Call your senators today and urge them to vote for S. 1619 or click HERE to e-mail your senators.)
A filibuster against the China currency bill was broken Oct. 6 (63-28). But the vote on final passage was delayed last week when Republicans tried to attach a series of weakening amendments.
America’s Future: Making the Contract for the American Dream a Reality
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Dave Johnson, a fellow at the Campaign for America’s Future, sends us this.
The Take Back the American Dream conference opened Tuesday with a discussion on the “Contract for the American Dream.” Deepak Bhargava of the Center for Community Change began by saying that there is a movement in America today and it’s not the tea party—it’s the American Dream Movement. People are working to build a huge movement that can meet this huge moment.
Our political system captured by powerful interests and angry voices. The American Dream movement is an effort to knit together the grassroots organizing that is already going on around the country and spark and inspire more. Reaching out to thousands of people through house parties and other events.
Justin Rubin of MoveOn described how the Contract for the American Dream was created by millions of Americans. First, dozens of organizations such as MoveOn and the Center for Community Change asked people what should be in a Contract for the American Dream.
Chinese Currency Bill Could Lead to More than 2 Million Jobs
Next week, the U.S. Senate will take up consideration of a bill to address Chinese currency manipulation. The Republican-controlled House is holding up its version of the legislation, even though it passed the House with overwhelming bipartisan support in 2010, with 99 Republicans supporting it.
Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar but is artificially pegged in order to boost China’s exports. Bringing the Chinese yuan to its equilibrium level—a 28.5 percent appreciation—is essential to creating much-needed jobs in this country. The Alliance for American Manufacturing says addressing Chinese currency manipulation would lead to:
Report: Trade Deficit with China Costs 2.8 Million Jobs
The U.S.-China trade deficit has eliminated or displaced nearly 2.8 million jobs, mainly in manufacturing, following that country’s entry into the World Trade Organization (WTO) in 2001, according to a study released today. View an interactive map of jobs lost throughout the United States here.
“Growing U.S. trade deficit with China cost 2.8 million jobs between 2001 and 2010” by Robert Scott, EPI’s director of trade and manufacturing policy research, finds that all 50 states, the District of Columbia and Puerto Rico suffered jobs lost or displaced as a result of the growing U.S.-China trade deficit.
The report cites illegal currency manipulation as a major cause of the trade deficit. Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar, but is artificially pegged in order to boost China’s exports.
Record Trade Deficit Shows Need for Currency Legislation
The U.S. Commerce Department announced today that our trade deficit reached $497 billion last year, including a new record $273 billion deficit with China.
Alliance for American Manufacturing (AAM) Executive Director Scott Paul said a record trade deficit with China “does not put us on a path to win the future.”
It will be hard to get our unemployment rate down if our trade deficit keeps going up. And while I am all in favor of doubling exports, it is a meaningless benchmark unless we also bring down our trade deficit. Instead, our global trade deficit is growing at an alarming and unsustainable rate.
One way to reduce the trade deficit is to pass the bipartisan Currency Reform for Fair Trade Act of 2011, introduced yesterday. It is the same legislation passed by the U.S. House of Representatives last September by a 348-79 margin. Read our post on the currency legislation here.
Vote Now to Press China on Currency Manipulation
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Ahead of President Obama’s meeting next week with China’s President Hu Jintao, the Washington Post is asking readers whether the White House should press Hu on China’s currency manipulation. The answer is an emphatic, “Yes!”
The Chinese government keeps its currency low, which artificially reduces the prices of its exports, creates a huge trade deficit for the United States and costs millions of American jobs.
Vote now here and let President Obama know that getting China’s government to act now on currency manipulation is an important step toward supporting our nation’s manufacturers and their workers.
Congressional Report: China’s WTO Membership Doesn’t Help U.S. Workers
China’s government has failed to live up to the claims its backers made in 2001 to help it gain entry into the World Trade Organization (WTO), according to a congressional commission.
In its 2010 annual report, released yesterday, the U.S.-China Economic and Security Review Commission (USCC) details the multiple ways the Chinese government has flooded the United States with exports while shutting its doors to imports and costing millions of U.S. jobs.
In an understatement, Carolyn Bartholomew, the commission’s vice-chairman, told a Washington, D.C., press conference yesterday:
The grounds on which it [China’s entry into the WTO] was sold did not turn out as promised for American workers.
Supporters claimed in 2001 that admitting China into the WTO would boost U.S. exports, increase American jobs and help transform China’s authoritarian government and enhance U.S. national security. None of that has happened, the USCC report says.
Urgent Action Needed to Stop Currency Manipulation
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It’s no secret that the Chinese government’s currency manipulation policy has caused the loss of millions of manufacturing jobs. But the question is whether the federal government has the will to act “to level the playing field and provide the support and assistance that millions of American workers and their communities expect and deserve,” United Steelworkers (USW) President Leo W. Gerard said today.
Testifying before the U.S. House Ways and Means Committee this morning, Gerard said passing the Currency Reform for Fair Trade Act (H.R. 2378) would be a vital first step to begin the process of economic recovery. The bill would give the U.S. Treasury Department new tools to combat currency manipulation.
Over the past 10 years, the Chinese government’s policy of deliberately devaluing its currency has caused the U.S. trade deficit with China to balloon from $84 billion in 2001 to $227 billion in 2009. The Economic Policy Institute (EPI) estimates that the growth in the U.S. trade deficit with China since 2001 cost 2.4 million U.S. jobs between 2001 and 2008.
Bold Action On China Currency Would Help U.S. Economy
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In two days of hearings that begin tomorrow, the House Ways and Means Committee will take a close look at the impact of the Chinese government’s policy of manipulating its currency on our economy.
He’s not on the Ways and Means witness list, but the committee should check out what economist Paul Krugman has to say about the subject. Writing in the New York Times yesterday, Krugman says the Chinese government has intimidated U.S. policymakers and businesses into not acting in our best interests because they are afraid that the Chinese governmnet—our biggest bond holder—will call in our debt if we get in their face about their currency policies.
But Krugman says, in effect, “bring it on.” He says that in a world awash with excess savings, “we don’t need China’s money” especially because the Federal Reserve could and should buy up any bonds the Chinese sell.
It’s true that the dollar would fall if [the Chinese government] decided to dump some American holdings. But this would actually help the U.S. economy, making our exports more competitive.
