The Communist Chinese government and its hundreds of “state sponsored” companies pay lip service to “free trade” while they marshal the economic, military and political muscle of their nation behind an aggressive mercantilist trade policy intent upon destroying and dismantling, piece-by-piece and industry-by-industry, what was once the proudest, mightiest and wealthiest manufacturing powerhouse on Earth – the United States of America. “Free trade” with China has not been free for America – it has come at a tremendous cost to American industry and American workers.
The latest Chinese assault on American businesses and workers is through the Chinese government’s intentional devaluation of its currency against the U.S. dollar. That is why I pledge my support for the Currency Reform for Fair Trade Act of 2011. This bill is a strong response to China and other foreign governments that subsidize their exports in an attempt to flood the American market with cheap foreign imports and to wipe out their American competitors. This bill will help level the playing field between China and the United States and will defend American businesses and workers from the continued onslaught of cheap, subsidized Chinese imports.
The Currency Reform for Fair Trade Act will impose much needed and long overdue countervailing duties on subsidized exports from countries such as China that continue to devalue their currency at the expense of American businesses. China’s unfair trade policies have destroyed millions of good-paying American jobs and thousands of once solid and profitable American businesses. This bill will defend America’s manufacturing and high technology sectors from massive and devastating cheap foreign imports and put Americans back to work.
Under Article 1 Section 8 of the United States Constitution, the U.S. Congress is empowered and required to regulate commerce between the U.S. and foreign nations. The U.S. Department of Commerce is required to execute the laws passed by the Congress pertaining to the regulation of foreign commerce. The Department of Commerce has the authority to impose a countervailing duty (i.e. a remedial “tariff”) on imports into the U.S. of goods benefitting from foreign subsidies that cause or threaten injury to a U.S. industry producing the same or substantially similar goods.
Notwithstanding the Constitutional requirement for the U.S. Department of Commerce to act in defense of and provide for the general welfare of American businesses and jobs, it has chosen not to. The Department of Commerce has taken a position that it will not consider currency devaluation as an export subsidy, and as a result the U.S. is refusing to protect itself from the massive and negative trade imbalance between the U.S. and
China, which is caused in part, by the Chinese government’s policy of devaluing its currency to make its exports to the U.S. and around the world cheaper.
Through the Currency Reform for Fair Trade Act, the Congress will resume its Constitutional duty by ordering the U.S. Department of Commerce to include currency devaluation by foreign governments as an export subsidy and by ordering Commerce to assess a “benefit” in terms of an additional benefit the foreign exporter receives as a result of the undervaluation. These changes to U.S. trade policy comply with the World Trade Organization rules. This beefed up U.S. trade policy will provide the “knock-out punch” to any injured U.S. industry that brings a case before the WTO. Instead of just talking about the problem, this new law will give U.S. industry the power to fight back.
Fred Bergsten, Director of the Peterson Institute for International Economics, estimates that a 20-40% appreciation in the value of the Chinese yuan will result in a $100-$150 billion improvement in the U.S. trade deficit with China and would generate 700,000 to 1 million new jobs in America. But, forcing China to allow its currency to float, and thus preventing the Chinese government from continuing to manipulate the currency to advantage its exports, will not in and of itself bring jobs back to America.
We must reform the entire fiscal, regulatory and monetary policies coming out of Washington, D.C. As part of my Free America Agenda, I will fight to free America from the burden of our massive national debt by passing a Balanced Budget Amendment. This will save us from bankruptcy, restart the economy and result in a smaller and more limited government. I will fight to free American taxpayers and small businesses from the oppression of the federal government by reducing the tax on work, savings and investment and eliminating job-crushing regulations. This will unleash the entrepreneurial spirit and energy of the American people, will lift our economy up and put millions of Americans back to work.
And lastly, I will fight to stop the United States government from manipulating and devaluing our own currency by reining-in the Federal Reserve. We must free America from the harmful policies of the Federal Reserve by stopping it from manipulating interest rates and printing money out of thin air. And, we must return to sound money. This will restore freedom to our “free” enterprise system, foster economic growth and job creation and stop the impoverishment of the American people through the scourge of inflation. A sound money monetary policy will help make America once again the strongest, wealthiest and freest nation on Earth.
That is why I am running for the United States Senate.
By: Marc A. Scaringi (R-PA) – candidate for the United States Senate