Aged Senate liberal Charles Schumer has asked the president to put more pressure on China over the trade issue. Schumer believes that the People’s Republic manipulates the yuan and continues to produce a trade environment that aides its own interests over those of the US. China may be guilty of both, but is almost certain to ignore American pressure to change.
Schumer has a new bill the goal of which would be to pressure China to act on the yuan and trade issues or face sanctions. The bill is a matter of debate in the days before China’s president Hu Jintoa visits the US. The Senator may think this is the perfect time to unleash Congress’s wrath. Schumer told Reuters, “It’s one of the things that’s seriously on the table. I’d like to see (Obama) either support our legislation or get China to do it on its own.”
Similar legislation has been to the floor of the House. China did not react to that. It knows the US cannot afford to block trade. China’s inexpensive goods are too important to the American economy. Any retaliation from the People’s Republic would lower the level of US exports to a country that is critical to American business.
The Administration lost its leverage with China when it twice refused to brand the most populous country as a manipulator of trade. Obama and Geithner would not risk a trade war which could damage America’s already weak GDP growth. China knows that.
Schumer is wasting his time.
Douglas A. McIntyre
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