Group Of House Republicans Offers China Currency Bill.

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Author: Vaughan, Martin

Trade

Twenty-two House Republicans led by Reps. Phil English of Pennsylvania, Mark Green of Wisconsin, Robin Hayes of North Carolina and Chris Chocola of Indiana introduced legislation today that would impose tariffs on Chinese goods at a level to be determined by the Treasury Department, if Treasury determines China is manipulating its currency. At a news conference, English said he had not talked with House Ways and Means Chairman Thomas or House GOP leaders about the specifics of his bill, but said he expected it "will get a hearing at the leadership level." But House Majority Leader DeLay in a separate news conference today was cool to the legislation, saying the China currency dispute should be addressed at the World Trade Organization. "To get into a trade war by congressional action, I think, is ill-conceived and would probably hurt the U.S., and particularly consumers in the United States, more than it would bother China," Delay said. English acknowledged that the legislation could in fact be ruled a violation of WTO rules, but said China would have little means to enforce that decision unless it wanted to put tariffs on imports from the United States that are essential for its own export-oriented industries. "The remedies under the WTO would be very limited for China. Much of what they buy from us they very badly need for their economy," English said.

The bill differs from legislation the Senate voted on earlier this year â€" offered by Sens. Charles Schumer, D-N.Y., and Lindsey Graham, R-S.C. â€" in that it would allow Treasury to set the level of the tariff, while the Schumer-Graham bill would fix the tariff at 27.5 percent. But the English bill would levy those tariffs within 90 days after the bill is enacted, subject to a finding by Treasury that China is manipulating its currency as defined by the General Agreement on Tariffs and Trade. In contrast, the Senate bill would give administration officials up to a year to negotiate a solution with the Chinese. The English bill differs from similar legislation he introduced in the last Congress by including the GATT standard for manipulation â€" a test that is less subjective and leaves less room for a negative finding than the current standard used by Treasury, which is based on the 1988 trade act.

Meanwhile, a coalition of domestic manufacturing groups today announced opposition to the Central America Free Trade Agreement. In a letter to President Bush, the groups â€" representing brush manufacturers, tool and die shops, and makers of modular homes and printed circuits â€" warned that small and medium-sized businesses would be harmed by the pact. "The six other CAFTA signatories are manifestly too small, too poor, and often too indebted to become significant consumer markets for U.S. exports. Their only attraction is to multinational corporations, which see them as low-cost bases for supplying the U.S. market," the groups wrote. House lawmakers opposing CAFTA including Reps. Sherrod Brown, D-Ohio, and Walter Jones, R-N.C., said the groups' stand was evidence that CAFTA opposition is not confined to textile, sugar and labor interests.

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By Martin Vaughan