WASHINGTON, D.C. – In response to years of illegal currency manipulation carried out by the Chinese government, the U.S. Senate today passed a bipartisan bill led by U.S. Sen. Sherrod Brown (D-OH) to level the playing field for American manufacturers and crack down on this unfair trade practice. The Currency Exchange Rate Oversight Reform Act of 2011, which would give the Obama Administration stronger authority to address currency manipulation and misalignment, cleared the Senate by a vote of 63 to 35.
“We are in trade war. But today we’re fighting back with one of the biggest bipartisan jobs bill the Senate has seen this year.
“Today, we put American workers and American manufacturers first by standing up to the Chinese.
“Today, we abandoned the unilateral disarmament approach we’ve taken for the past decade.
“We overcame criticisms that this bill would spark retaliatory tariffs from the Chinese. Because we finally acknowledged that American exporters already pay a tariff—to the tune of 25 to 40 percent—because of Chinese currency manipulation.
“Our workers and manufacturers can compete with anyone on a level playing field. My state of Ohio has a proud history of manufacturing. And throughout Ohio, I’ve heard from dozens of small business owners that are struggling to compete against Chinese companies that are able to illegally undercut American companies thanks to currency manipulation.
“We’ve seen how strong trade enforcement can create and protect jobs. Just ask the workers at V&M Star Steel in Youngstown, U.S. Steel in Lorain, or SMART Papers in Hamilton. By addressing illegal Chinese trade practices, we have been able to increase demand for domestic production, saving jobs in the process.
“This bill has strong bipartisan support. Senators Schumer, Casey, Snowe, Stabenow, Hagan, Sessions, Burr, Graham, Collins, and I have been working together to bring this bill to the floor. It has been endorsed by a wide range of businesses and labor groups.
“This bill has the potential to create or save two million jobs—at no cost to taxpayers—while raising revenue and reducing our deficit.
“Today, the Senate has decided to not give up on American workers, American manufacturers, and our country’s industrial base.”
The Chinese government has long practiced currency manipulation by intentionally devaluing its own currency against the United States dollar. This results in artificially expensive American imports to China, and artificially cheap Chinese imports to the United States. This puts Ohio and American manufacturers at a serious disadvantage, and makes it more difficult for American companies to compete against Chinese companies.
Recently, the Economic Policy Institute (EPI) and the Alliance for American Manufacturing released a new report showing that that the growing trade deficit with China, caused in large part by China’s illegal currency manipulation, has cost the United States more than 2.8 million jobs since 2001, including more than 1.9 million manufacturing jobs. In June, EPI released a report showing that addressing Chinese currency manipulation could support the creation of 2.25 million American jobs.
A summary of the bill can be found here.