Congress threatens currency bill as Obama and Hu prepare to meet
While the White House is preparing festivities for Chinese President Hu Jintao's state visit this week, Congress has been less welcoming.
Lawmakers are seizing on the visit to again raise longstanding concerns about currency manipulation and the impact on U.S. jobs. Some are seeking to sanction China for economic policies they see as unfair or even illegal.
Senators Sherrod Brown (D-Ohio) and Olympia Snowe (R-Maine) on Tuesday sent a letter to Treasury Secretary Timothy Geithner saying they planned to introduce legislation that would provide ammunition for the government to respond to currency manipulation.
More specifically, their bill would allow the Department of Commerce to treat currency undervaluation as a prohibited export subsidy.
"China's actions to subsidize its exports through currency manipulation pose both immediate and long-term challenges to American manufacturers and workers still recovering from the economic recession," the lawmakers said in the letter.
In September, the House passed a currency bill directed at China by a 348-79 margin. It was never considered in the Senate, but last month 30 U.S. senators led by Finance Committee Chairman Max Baucus (D-Mont.) sent a letter to a top Chinese official mentioning the House bill and threatening that the Senate "may follow suit" if China does not introduce currency reforms.
This week, U.S. Senators Debbie Stabenow (D-Mich.), Charles Schumer (D-N.Y.) and Bob Casey (D-Pa.) also said they will unveil legislation to address the currency issue. They said the bill would make it difficult for the Treasury Department not to formally label China a currency manipulator and that such a country would be subject to stiff penalties such as export tariffs and a ban on government contracts.
"Our message to President Hu is, 'Welcome to America, but we want to make sure we have a fair trading system,'" Stabenow said.
Meanwhile, Congressmen Mike Michaud (D-Maine) and Thaddeus McCotter (R-MI) are circulating a letter on Capitol Hill that calls on Obama to tell Hu that "America's patience is near an end and that we can no longer afford to tolerate China's disregard for the binding commitments."
"Numerous economic policies in China violate their WTO commitments, and all of them harm U.S. businesses and employment."
Ariana Eunjung Cha
| January 18, 2011; 1:47 PM ET
Categories: China, Congress, White House
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