Lipinski Fights to Protect American Workers from Unfair Trade Practices by China

Press Release

Lipinski Fights to Protect American Workers from Unfair Trade Practices by China

Today Congressman Dan Lipinski (IL-03) announced that he is again cosponsoring legislation that would crack down on the illegal and unfair currency manipulation that has been increasing our trade deficit and hurting American workers. By keeping their currencies undervalued with respect to the U.S. dollar, countries like China have been effectively subsidizing their exports and putting a tariff on American imports. The Currency Reform for Fair Trade Act of 2009 would put an end to this unfair practice.

"For too long countries like China have gotten away with illegally subsidizing their exports," said Lipinski. "Not only does this undercut our manufacturers here at home, but their currency manipulation makes it almost impossible for us to export goods back to China. Leveling the playing field for domestic production is one of the quickest ways to put Americans back to work."

The legislation, similar to bills that Lipinski has cosponsored previously, would crack down on countries that prevent market forces from determining the value of their currency. By keeping their value of their currency artificially low, these countries keep the price of its goods cheap, generating a generate trade imbalance. Although Treasury Secretary Tim Geitner testified during his confirmation hearings that the Obama Administration planned to "aggressively" use diplomatic avenues to crack down this practice, Congressman Lipinski is not waiting for them to act.

"Currency manipulation is another example of how supposed ‘free trade' has only been a one-way street," continued Lipinski. "For decades, Americans have played by the book while others have gamed the system. The result has been disastrous - our domestic manufacturing base has been weakened and good paying jobs in this country have been sent abroad. Our WTO trade agreements give us rights and we should use them to protect American workers and penalize unfair trade practices. This bill does just that."

The Currency Reform bill directs the Department of Commerce to develop a transparent protocol to measure exchange-rate misalignment with publicly available International Monetary Fund data. It further directs them to treat currency undervaluation as a WTO prohibited export-contingent subsidy, which would allow injured American industries to seek remedies, and it provides for anti-dumping duties on undervalued imported goods. All of these safeguards are implemented in a manner consistent with WTO rules.

"Since 2001, the United States has lost almost 5 million manufacturing jobs," said Bill Hickey, president of Lapham-Hickey Steel Corporation of Chicago, "Much of this is traceable to the kind of mercantilist policies that this bill is trying to stop. I am glad that Congressman Lipinski is fighting for American jobs and working make our trade laws account for currency manipulation. This bill will help level the playing field for U.S. manufacturers and is a critical factor in our economic recovery."

As a member of the House Committee on Small Business, Representative Lipinski has been an advocate for American manufactures and workers. In addition to fighting to make "free trade" fair, Rep. Lipinski has been a leading proponent of the idea that the Federal Government should Buy American whenever possible.

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