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While the American Jobs Act failed a cloture vote last night, the Currency Exchange Rate Oversight Reform Act passed the Senate on a final vote. That bill would allow the Commerce Department to target currency manipulators like China with tariffs proportional to their currency manipulation if industries or unions file complaints. And it would force the Treasury Department to brand currency manipulators rather than having leeway to avoid it.
Like the other two cloture votes, this bill received super-majority support in the Senate, with a final vote of 63-35. The bill now moves to the House, where a version of it has a majority co-sponsoring, including 61 Republicans. But the House GOP leadership is blocking a vote.
House Speaker John Boehner last week said it would be “dangerous” for Congress to get involved with a foreign country’s exchange rate.
Another top Republican, House Majority Leader Eric Cantor, said President Barack Obama should clarify his position on the bill, which has drawn warnings from Beijing.
“What I would like to see is where the administration is. Clearly they’ve got concerns as well,” Cantor, the No. 2 House Republican, told reporters.
This is also a rare instance of the White House hiding behind the obstructionism of the House GOP. I imagine they’re perfectly content to see the House deny passage of the bill. But there are plenty of Senate Republicans who want to see passage of the bill; Harry Reid invoked Lindsey Graham in his statement — “I join my colleague, Senator Graham, in calling on the House to take up this bill and pass it quickly”.
The one tool that Democrats have at their disposal to force a vote is a discharge petition, which would lead to a vote if a majority of the chamber signs. But while 61 Republicans co-sponsored the bill, almost none of them have signed the discharge petition, and the one who did, Hal Rogers of Kentucky, had his name removed a day later. The situation is further complicated by the fact that Mitt Romney, the likely nominee for the GOP, supports branding China a currency manipulator, and reiterated that belief at last night’s Presidential debate.
Meanwhile, China is formally lobbying against the bill, with a 12-member “Congressional Liaison Team” working inside the Chinese Embassy and meeting with lawmakers as well as White House officials. State-run media in China is likening the bill to the Smoot-Hawley Act, which raised tariffs during the Depression. The assumption is that Smoot-Hawley caused or exacerbated the Depression, which it actually didn’t.
China also claims that they have appreciated the yuan “greatly” in the past 6 years, which is also not entirely true. They continue to purchase hundreds of billions of US dollars to keep their currency artificially low. According to a Peterson Institute for International Economics report, China’s currency manipulation is at a greater level this year than it was last year.
But clearly there’s going to be a real fight to get a vote in the House. The 61 Republicans co-sponsors, who I will name below, have a choice to make. They can pay lip service to helping American exports and lowering the trade deficit, bringing jobs to their communities, or they can do something about it. And the House leadership has a role to play, as Nancy Pelosi said in a statement last night.
“The Republican Leadership is thwarting the will of the House by blocking a vote on this jobs bill. I call on Speaker Boehner to listen to the American people and bring this bill to the floor and allow it to receive the bipartisan vote it deserves.”
It’s certainly a better trade agenda than the three so-called free trade agreements, which are expected to pass both houses of Congress today.
Here are the Republican co-sponsors, on the flip:
Republican Co-Sponsors of Currency Reform for Fair Trade Act (H.R. 639)
Rep. Todd Akin (Missouri)
Rep. Steve Austria (Ohio)
Rep. Lou Barletta (Pennsylvania)
Rep. Brian Bilbray (California)
Rep. Rob Bishop (Utah)
Rep. Mo Brooks (Alabama)
Rep. Dan Burton (Indiana)
Rep. Shelley Moore Capito (West Virginia)
Rep. Howard Coble (North Carolina)
Rep. Chip Cravaack (Minnesota)
Rep. Rick Crawford (Arkansas)
Rep. Charlie Dent (Pennsylvania)
Rep. Jo Ann Emerson (Missouri)
Rep. Mike Fitzpatrick (Pennsylvania)
Rep. Randy Forbes (Virginia)
Rep. Jeff Fortenberry (Nebraska)
Rep. Jim Gerlach (Pennsylvania)
Rep. Chris Gibson (New York)
Rep. Sam Graves (Missouri)
Rep. Morgan Griffith (Virginia)
Rep. Gregg Harper (Mississippi)
Rep. Duncan Hunter (California)
Rep. Bill Johnson (Ohio)
Rep. Tim Johnson (Illinois)
Rep. Walter Jones (North Carolina)
Rep. Mike Kelly (Pennsylvania)
Rep. Steve LaTourette (Ohio)
Rep. Frank LoBiondo (New Jersey)
Rep. Blaine Luetkemeyer (Missouri)
Rep. Donald Manzullo (Illinois)
Rep. Tom Marino (Pennsylvania)
Rep. Thaddeus McCotter (Michigan)
Rep. Patrick McHenry (North Carolina)
Rep. David McKinley (West Virginia)
Rep. Patrick Meehan (Pennsylvania)
Rep. Candice Miller (Michigan)
Rep. Tim Murphy (Pennsylvania)
Rep. Sue Myrick (North Carolina)
Rep. Tom Petri (Wisconsin)
Rep. Joe Pitts (Pennsylvania)
Rep. Todd Platts (Pennsylvania)
Rep. James Renacci (Ohio)
Rep. Scott Rigell (Virginia)
Rep. Hal Rogers (Kentucky)
Rep. Mike Rogers (Michigan)
Rep. Mike Rogers (Alabama)
Rep. Dana Rohrabacher (California)
Rep. Dennis Ross (Florida)
Rep. Jon Runyan (Pennsylvania)
Rep. Jim Sensenbrenner (Wisconsin)
Rep. John Shimkus (Illinois)
Rep. Bill Shuster (Pennsylvania)
Rep. Marlin Stutzman (Indiana)
Rep. Glenn Thompson (Pennsylvania)
Rep. Michael Turner (Ohio)
Rep. Lynn Westmoreland (Georgia)
Rep. Ed Whitfield (Kentucky)
Rep. Joe Wilson (South Carolina)
Rep. Rob Wittman (Virginia)
Rep. Frank Wolf (Virginia)
Rep. Don Young (Alaska)
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How will China’s membership in the WTO figure in the imposition of tariffs? Won’t they be able to say that that is restraint of trade and force us to back off?
Isn’t it interesting how the Republicans want to destroy the unions, but when they want their help they have no problems with the unions.
Note how they have verbiage about the unions being able to file complaints.
Please delete this sentence. Hiding behind GOP obstructionism is the modus operandi for the White House and every other Democrat on Capitol Hill.
Frankly, this is just another example of American hypocrisy. Of course China is “manipulating” its currency in order to help Chinese industry and keep unemployment lower than it might otherwise be. But America also “manipulates” its currency to help specific American businesses. In the case of the US, the focus is much more on helping the US banks and US investors in other countries than it is on supporting manufacturing in the US, but that just reflects the political domination of the US government by the rich.
Smoot-Hawley was an example of the “beggar your neighbor” trade policies the prevailed during the Great Depression, as each country tried to make other countries suffer the worst consequences of the Great Depression. Because the US at the time had a very strong economy, it probably hurt other countries more than it hurt the US. But it certainly started a wave of retaliatory trade policies that hurt world trade. To quote the Wikipedia article on Smoot-Hawley,
I think the current desire among some US politicians for trade sanctions against China has more to do with the US Military Industrial Complex’s need for an enemy (in order to justify spending huge amounts on the military), and the desire for a scapegoat, (in order to distract the US public from the criminality of US elites), than it does with getting more manufacturing jobs for Americans. Vilifying the Chinese as “currency manipulators” ignores the fact that when American corporations use Chinese labor to manufacture things in China and then ship them back to the US, it counts as part of a Chinese trade surplus. When parts are manufactured in Vietnam or Singapore and then shipped to China to be assembled into items which are then exported to the rest of the world, that also counts as part of a “trade surplus”.
America needs to become more serious about helping American manufacturing, but attacking the Chinese and trying to export unemployment to the second largest economy in the world is not the way to do that.