The widening trade deficit “is adding pressure on Senate Democratic leaders to take [up] legislation to remedy currency manipulation by China,” The Hill reports.
Democratic Conference Vice Chairman Charles Schumer (N.Y.) said last week both he and Majority Leader Harry Reid (D-Nev.) are closely eyeing how to add it to an already chock-full four-week agenda that begins in September.
“We’re very interested in bringing it up, yes,” said Schumer, who called the issue an “economic imperative.”
“It makes it a lot easier to buy cheap imports, hurts our more-advanced exports, and it hurts our overall economy,” said Schumer, who repeatedly has played the bad cop with China to the executive branch’s good cop through two administrations.
The Obama Administration “does not want Schumer’s bill to move forward, and White House Chief of Staff Rahm Emanuel has asked Schumer to hold off, fearing even a Senate vote on the bill could impede U.S.-China relations.”
Some background:
In a surprise, the U.S. trade gap widened by 19 percent in June, the Commerce Department reported this week, raising concerns the economic recovery is sliding backward.
Officials said the $49.9 billion deficit was the worst since October 2008, just before the crisis hit in full force — and it followed a $42 billion gap in May.
The largest U.S. trade deficit is with China, and many economists believe that country’s currency policies exacerbate the imbalance. The U.S. gap with China specifically hit $26.2 billion in June, another statistic at its worst level since October 2008.
U.S. manufacturers and workers argue China manipulates its currency, keeping it artificially low to make it easier to sell its exports. By some estimates, China’s currency is undervalued by 25 percent to 40 percent against the U.S. dollar.
(credit image – daylife/associated press)
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