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China Currency Legislation Tops Washington Agenda

Oct 12, 2011

Republican leaders in the House of Representatives are under increasing pressure to pass legislation relating to China’s so-called currency manipulation. China has been accused by government officials of purposefully undervaluing its currency, the remnibi, leading to a vastly unfair trade advantage over the United States.

The legislation, which is widely expected to pass the Senate easily, is characterized by Senate Democrats as a major jobs bill that will help stimulate the stagnant American economy. President Obama and Democratic leaders in both chambers have made jobs-related legislation a centerpiece issue during the last several weeks.

”By demanding that China end its manipulation of its currency, we could level the playing field for American workers and businesses, and cut our trade deficit with China — at no cost to taxpayers. Now is the time for the House Republican leadership to stand with American workers by allowing the House to pass the bipartisan China currency bill and put more Americans back to work,” said House Minority Leader Nancy Pelosi (D-CA).

House Democrats, led by Pelosi and Rep. Steny Hoyer (D-MD) among others, are seeking to force a vote in the Republican-controlled House through a maneuver known as a “discharge petition,” which would require 218 signatures to succeed.

House Speaker John Boehner (R-OH) has warned his conservative caucus that the China currency bill is “dangerous.” Last year, however, 99 House Republicans voted for currency legislation that passed by a vote of 348-79. Appropriations Committee Chairman Hal Rogers (R-KY), Energy and Commerce Committee Chairman Fred Upton (R-MI) and other high-ranking Republicans were among the co-sponsors of the bill. Chief Deputy Whip Peter Roskam (R-IL) and Ways and Means Committee Chairman Dave Camp (R-MI) also voted for it. Roskam and Upton told sources that they have no intention of signing a discharge petition. Boehner, Majority Leader Eric Cantor (R-VA) and Majority Whip Kevin McCarthy (R-CA) voted against the bill last year.

“For the Congress of the United States to pass legislation to force the Chinese to do what is arguably very difficult to do, I think, is wrong. It's dangerous. You could start a trade war. And a trade war, given the economic uncertainty here and all around the world is just very dangerous and we should not be engaged in this,” said Boehner at a news conference last week.

Asked to clarify his position on the bill at a White House press conference last week, President Obama said, “I don't want a situation where we're just passing laws that are symbolic, knowing that they're probably not going to be upheld by the World Trade Organization, for example, and then suddenly U.S. companies are subject to a whole bunch of sanctions. I think we've got a strong case to make, but we've just got to make sure that we do it in a way that's going to be effective.”

Democratic Rep. Mark Critz (Pa.), who is leading the discharge petition, conceded that the president’s position on the issue is “wishy-washy.” However, with the Senate’s momentum on the bill, Critz believes that GOP leadership and the president will be forced to act on the matter. The Senate proposal, backed by solid Republican support, has cleared two procedural hurdles and is expected to clear the Senate soon.

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