Getting China to play fairly, and playing fairly ourselves

“Geithner: China Must Lose Trade Barriers
By Martin Crutsinger, AP Economics Writer
Manufacturing.Net - June 10, 2010

WASHINGTON (AP) -- Treasury Secretary Timothy Geithner faced a barrage of U.S. congressional complaints Thursday over what critics said was the administration's failure to take a tougher stance on Chinese trade issues.

Both Democrats and Republicans on the Senate Finance Committee warned Geithner that Congress' patience was wearing thin. One critic said if China does not move soon to allow its currency to rise in value against the dollar, Congress is likely to pass legislation that would impose tough trade sanctions on China.

"I am confident that this bill will pass the Senate with overwhelming support," Sen. Charles Schumer, a leading Democrat, told Geithner. "The issue here is not U.S. protectionism but China's flouting of the rules of free trade."

Schumer has said he hopes to get a Senate vote in the next two weeks.

Geithner was criticized by several lawmakers over his decision in April to delay release of a report Treasury is required to present to Congress every six months with the administration's findings on whether any country is manipulating its currency.

Sen. Jim Bunning, a Republican, accused Geithner of violating the law by delaying the currency report. He said the administration's inaction was "trading away' American jobs, citing one estimate that 2.4 million manufacturing jobs have been lost in the United States because of China's unfair trade practices including currency manipulation.

Geithner said that the Obama administration had delayed the report, as had previous administrations, in the belief that the delay would enhance the chances that Beijing will move to allow its currency to start rising in value against the dollar.

Sen. Charles Grassley, a Republican, said that it was past time for Treasury to brand China a currency manipulator, a designation that could eventually lead to U.S. trade sanctions against Chinese imports.

China did allow its currency, the yuan, to rise in value from July 2005 until the summer of 2008 by about 20 percent but then abruptly halted the practice with the onset of the global economic downturn out of concern about the impact a stronger Chinese currency would have on its exports.”