U.S. Senator Charles Schumer of New York, the lead Democratic sponsor of legislation to get China to raise the value of its currency, said he plans to seek a Senate vote on the measure after the November elections.
“Critics of our bill say it would start a trade war with China -- but this isn’t right because American companies already are fighting a war for survival in China,” Schumer said today on the Senate floor. “The issue here is not U.S. protectionism, but China’s flouting of the rules of free trade.”
The House probably will vote on the legislation on Sept. 30, said Representative Chris Van Hollen, a Maryland Democrat and assistant to the Speaker. The bill has been debated after years of lawmaker complaints that China’s weak yuan gives its producers an unfair advantage against American manufacturers.
The measure, which would let companies petition for duties on imports from China to compensate for what lawmakers said is an undervalued currency, has enough support that it may be able to pass on an expedited schedule with backing from two thirds of lawmakers, House Majority Leader Steny Hoyer said today.
This “will help level the playing field for American businesses and workers,” Hoyer said in a Washington speech.
The U.S. trade deficit with China widened to $145 billion in the first seven months of this year, from $123 billion for the same period in 2009. The widening deficit, unemployment lingering at almost 10 percent and polls showing Democrats’ seats at risk heading into the Nov. 2 election have added support for the bill, which has been discussed since 2005.
The yuan has strengthened about 2 percent against the dollar since June 19, when China’s central bank said it would pursue a more flexible exchange rate. That rate of gain is “inadequate,” Treasury Secretary Timothy F. Geithner told the panel last week. Pressure from lawmakers is helping the administration make the case to China to raise the value of the yuan, he said.