July 13, 2011Brown Urges Currency Bill to Close Gap
WASHINGTON -- U.S. Sherrod Brown is renewing his call for passage of the Currency Reform for Fair Trade Act of 2011, following the release of new numbers showing a widening trade gap with China.
The U.S. trade deficit increased to its highest level in more than two and a half years, the trade gap with China widening 15.6% to $24.96 billion in May, Brown's office reported.
The legislation would give the Obama Administration additional tools to address China's currency manipulation. It directs the U.S. Department of Commerce to treat currency undervaluation as a prohibited export subsidy, and would ensure the government is equipped to respond on behalf of American workers and manufacturers by imposing countervailing duties on subsidized exports from countries like China.
"While we debate the budget deficit, too many Washington politicians are ignoring the trade deficit -- and its dangerous effects on American jobs," Brown, D-Ohio, said in a statement. "The best way to get our fiscal house in order is to get Americans working again -- and that means cracking down on practices like Chinese currency manipulation, which hurts Ohio manufacturing and American job creation efforts. By combating currency manipulation, we can help level the playing field for American manufacturers and speed up our economic recovery."
The bill, which U.S. Sen. Olympia Snowe, R-Maine, also is working to pass, mirrors a similar measure sponsored by U.S. Rep.Tim Ryan, D-17 Ohio, that passed in 111th Congress by a vote of 348-79, including 99 Republicans.
A report released in June by the Economic Policy Institute shows that addressing Chinese currency manipulation could support the creation of 2.25 million American jobs, Brown notes.
According to the report, if China was to revalue the yuan to its equilibrium level, and other Asian countries followed suit, U.S. gross domestic product would increase by as much as $285.7 billion (1.9%) and the federal budget deficit would decrease by up to $71.4 billion per year -- or between $621 to $857 billion over 10 years, if sustained. The estimated new jobs would be enough to enough to increase total U.S. employment by 1.6%.
