Currency Exchange Rate Oversight Reform Act of 2011
Floor Speech
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Mr. CARDIN. Madam President, I rise to urge my colleagues to support the Currency Exchange Rate Oversight Reform Act, S. 1619, of which I am proud to be an original cosponsor. I wish to thank my colleague and friend, Mr. Brown, the Senator from Ohio, for his leadership in bringing forward this very important legislation.
This legislation is about jobs. We all talk about ways we can increase job opportunity in America. Yes, we have to do a better job in our infrastructure and rebuilding America, our roads, our bridges, our schools, our energy infrastructure, our water infrastructure. That is a very important part of job growth in America. We have to help our small businesses.
The President is right to focus a program that will help small businesses because that is the job growth energy in America. But another area that is critically important for us on job growth is trade.
I represent the State of Maryland. The Port of Baltimore is an economic engine of our State, where we employ many people because of the Port of Baltimore. We want to see products that not only come into America, but we want to see products that leave America for the international marketplace. American manufacturers, producers, and farmers can outcompete their competition anywhere in the world as long as we have a level playing field. If we have a level playing field, we will not only keep jobs in America, we will create new jobs in America because we can outcompete the world. But we can't do it if we give away a huge advantage to other countries. Currency manipulation allows other countries to have unfair competitive advantage over American manufacturers, producers, and farmers. That is what this bill is aimed at: to give us a level playing field, to allow us to be able to compete fairly.
I also wish to acknowledge that this legislation is bipartisan. I think it is nonpartisan. This is legislation that makes sense for our country to keep jobs and create jobs. The legislation provides necessary mechanisms to help halt currency manipulation committed by any country. Currency manipulation is an unfair trade practice that reduces the price of imported goods while raising the price of American goods.
We are talking about giving a discount to our competitors. How do we expect an American manufacturer to be able to compete with an imported product if they get a discount on the price? That is what happens when they arbitrarily undervalue their currency as a foreign competitor, and that is what is happening to American manufacturers. Trying to end this practice is just common sense and will finally allow us to address our net exports, helping us reduce trade imbalances and, most importantly, create jobs in America.
Of course, China is one of the largest abusers of this type of manipulation. Despite a pledge from China in 2001 to adhere to open and fair trade, it continues to violate global trade rules which, in turn, erodes the U.S. manufacturing base and economy.
One of these market-distorting practices is China's effort to keep its currency severely undervalued. Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar but is artificially pegged in order to boost China's exports. Bringing the Chinese yuan to its equilibrium level at 28.5 appreciation is essential to creating much needed jobs in this country as well as a fair and global marketplace.
Let me repeat this. Because of what China does on pegging its currency to ours, not allowing it to freely fluctuate, Chinese products, in effect, get a 28.5-percent discount. If a company is manufacturing a product and trying to compete with an imported Chinese product, how can they do that if their competitor gets a 28.5-percent discount? That is what is happening in America today.
This legislation would allow those who are being harmed by this unfair trade practice to be able to bring a trade remedy against that unfairly imported product.
Inexpensive Chinese imports have caused a great deal of harm to the U.S. manufacturing sector. New studies show that 2.8 million American jobs, including 1.9 million manufacturing jobs, were lost or displaced over the past decade due to the growing U.S. trade deficit with China, fueled, in part, by currency manipulation.
So we have documented millions of jobs that we have lost and that have been lost because we have allowed, without challenge, China to give discounts to its manufacturers bringing products into America. Again, if it is a level playing field, American manufacturers and producers can compete. But they can't compete with such an unfair trading practice.
Many U.S. industries have been hard hit by unfair trade practices and currency manipulation, impeding their ability to compete here and abroad. The Alliance for American Manufacturing says that addressing this currency manipulation would lead to the creation of up to 2.25 million American jobs, an increase in the U.S. gross domestic product of $285.7 billion, a 1.9-percent--or $190 billion--reduction in our annual trade deficit; finally, an annual deficit of $71 billion, or between $600 to $800 billion over the next 10 years, if sustained.
No wonder this is bipartisan. No wonder this is nonpartisan. Here, by just standing up for American manufacturers and allowing them to be on a level playing field, we can not only increase jobs in America, we can not only reduce the trade imbalance, we can also reduce the budget imbalance. All that can be done if we can establish a level playing field to give our manufacturers, producers, and farmers the opportunity to challenge this unfair practice. That is what this legislation does.
With figures such as this, this bill is seemingly a noncost, bipartisan, long-term jobs measure. This would not only spur economic growth but economic stability that would ensure a better and more secure future for U.S. manufacturers, workers, and communities. This is to keep jobs here in America but also give us the opportunity to create more jobs, helping our economy grow. Simply put, this legislation will allow U.S. manufacturers the ability to use existing countervailing duty laws to obtain relief from injury caused by imported goods which benefit from currency manipulation as export subsidies while also providing the U.S. Treasury a new framework by which to identify misaligned currency.
In September 2010, the House adopted a similar measure with overwhelming bipartisan support. Passage here in the Senate will lead to real consequences for countries that abuse currency manipulation, and empower the United States to create a more level economic playing field.
We can get this done. This is something that can get done. The House has already passed it. We have bipartisan support in the Senate. We have the votes to pass it. I urge my colleagues, let us get this done. Don't try to put other amendments on it. All they are going to do is make it difficult for us to achieve something great for our economy and great for American production. Let's get this matter up for a vote and not try to do all these unrelated amendments.
I applaud my colleague Senator Brown from Ohio. He is on the floor. I mentioned earlier I thank him for his leadership for not only bringing this bill together but keeping the bipartisan group together so we can show we can get this done. Now we need the Members of the Senate to say it is time for us to vote on this bill. Let's get it done. Let's send it to the President for the President to sign it. Let's do something that will not only create jobs but help us deal with our trade imbalance and deal with our budget imbalance.
Madam President, I yield the floor.
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