Senators target China with trade bill
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Kai Ryssdal: The U.S. trade deficit with China runs at just about $20 billion a month, each and every month of the year.
It's a pretty simple formula. China's currency is relatively cheap against the dollar. That makes Chinese imports relatively cheap for American consumers.Catch is, it makes American exports relatively expensive for Chinese consumers.
U.S. manufacturers and many politicians have been saying for years that's intentional. That Beijing keeps the yuan artificially low to get an unfair trading advantage. All the while, the White House has made noises like it sympathizes, but it hasn't really done anything to change the situation.
So today, a bipartisan group of senators tried to make 'em. Marketplace's Steve Henn reports
Steve Henn: This morning, the Treasury Department officially labeled the Chinese yuan as "undervalued."
But many law makers and industry groups had been hoping that Treasury Secretary Hank Paulson would go further and declare that Bejing's is manipulating its currency.
But speaking last week, Secretary Paulson signaled he was reluctance to push China too hard.
Henry Paulson: I tend to be pretty pragmatic. I know what to the sentiment is in China. I know what the sentiment is here. My objective is just to keep making progress.
But many lawmakers would like that progress to come a whole lot faster. So this afternoon, a bipartisan group of four senators — including Chuck Schumer of New York — introduced legislation designed to make it almost impossible for Treasury to avoid taking action.
Charles Schumer: They're going to have to twist themselves in a pretzel.
Under the new bill, penalties aimed at China would include invoking anti-dumping provisions and unilaterally increasing those fines.
That makes Stephanie Lester nervous. She represents retailers that benefit from cheap imports.
Stephanie Lester: We don't want to prompt a trade war if we go down this path.
But other industry groups, especially manufacturers, signaled their support of the senators' proposal today. And the sponsors predict it will sail through Congress with a veto-proof majority.
In Washington, I'm Steve Henn for Marketplace.