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Public Statements

Currency Exchange Rate Oversight Reform Act of 2011

Floor Speech

Location: Washington, DC


Ms. STABENOW. I rise today to, first of all, congratulate all of my colleagues, the 79 Members who came together to vote to proceed to a very important measure, a jobs bill that is currently before us.

The great news is that it is a jobs bill that will cost us zero dollars to be able to implement in terms of about 2.25 million new jobs, new jobs that will come. Why? Because we are saying as a group, as the Senate: Enough is enough, and we want China as well as other countries to follow the rules. We want them to follow the rules so when our companies and our workers are competing in a global economy they will have a level playing field and the ability to compete. We know if the rules are fair, if there is a level playing field, we in America will compete, and we will win. We know that.

The biggest violator on any number of trade issues we know of right now is China. When they joined the WTO 10 years ago, the whole point of them being able to join the world community under a world set of economic agreements was to make sure they would have to follow the rules like everybody else. But ever since that time they have done nothing but flagrantly violate the rules.

When China does not play by the rules, it costs us jobs. It puts our businesses in Michigan, our workers in Michigan and across the country at a severe disadvantage. It has to stop. We in Michigan have been through more, deeper and longer than any other State in the Union, and we are coming back because of a great work ethic and ingenuity and ideas and entrepreneurship. We are moving forward and creating new ideas. More clean energy patents are being created in Michigan than in any other place in the country.

We just had news today that, in fact, we are--last year 2010--the fastest growing high-tech sector. There are more high-tech research and development jobs in Michigan than any other place in the country. So we know how to compete and we know how to win.

But we are in a global economy, where our companies are competing against countries. When we have an entity, a country like China that does not believe they need to follow the rules--whether it is stealing our patents, whether it is blocking our businesses from being able to bid to do business in China, or whether it is the huge issue of currency manipulation, which is in front of us today, we know the rules matter. We know it is our job to stand for American businesses and American workers, and that is what the bill in front of us does.

It says to China and any other country involved in currency manipulation that we have had enough. It directs Treasury to take action; to look around the globe, determine where there is currency misalignment, and to prioritize the countries that are most egregious in their actions--we know China is at the top of that list--and then it requires them to act.

It requires Commerce to work with our businesses to act. We have had enough talk. We have had enough of hearing about give China time. We are now past 10 years when they entered the WTO, and every time we start talking about this, they say: Well, we are going to change it. We are starting to change it.

There are those in Congress who say not only has it not changed but maybe it is even getting worse. The point is, we are losing jobs as a result of the way China cheats. Enough is enough.

How do they do that? In this case, when we say currency manipulation, eyes glaze over. The reality is, because of the way they value their money--their currency--they are able to get an artificial discount. Their products appear to cost less coming to the United States--the same product made the same way. Ours artificially gets an increase in the price. It can be up to a 40-percent difference, not because of anything other than the fact that they do not value their currency the way every other country in the world does in the world economy. They always make sure they peg it in a way that they get a discount, no matter what.

That is illegal under the WTO. It is unfair. It is cheating. That is what this bill fixes. A real-world example: We have some great auto parts manufacturers in Michigan, and a very common story would be that a part breaks and to get another part, it costs $100 in Michigan, but the Chinese were able to peg their cost at $60--not because it was any different, other than the fact that they value their currency in a way that allows them to have it appear that it costs less. So this is something we intend to take action on.

We know right now that if the Chinese currency was revalued, if they did what everybody else does and followed the rules, we would see up to $286 billion added to the U.S. GDP right now. We would see 2.25 million U.S. jobs being created if China and others around them followed the lead and revalued their currency--2.25 million jobs. We don't need a line item in the budget to do that.

We are not talking about a new program. We are simply talking about leveling the playing field and stopping China from cheating. We can create those jobs. Our deficit would be reduced by between $621 billion and $857 billion, at no cost to taxpayers. At a time when we are struggling with the largest deficit we have ever had, and we are struggling with how we address that, the ability to have up to $857 billion reduced in our deficit at no cost to taxpayers--that sounds like a pretty good deal to me. People in Michigan would say: Why has it taken so long to be able to address this?

Now is the time that we have a strong, bipartisan coalition. I am so proud of all our colleagues who have come together from every part of the country, every part of our economy, whether it is manufacturing, agriculture, textiles or those involved in high tech, saying it is time for us to stand for America, for American jobs, and for American businesses. That is what this is all about. What else are we hearing about this particular effort? The Federal Reserve Chairman, Ben Bernanke, said:

The Chinese currency policy is blocking what might be a more normal recovery process in the global economy. It is ..... hurting the recovery.

Again, that is something we can do to reduce the deficit and create jobs. China is proceeding with a policy that is hurting the recovery, at a time when we need to get everything out of the way so we can come roaring back as a country. We are the greatest country in the world. We have tremendous challenges right now, economically, that we will work our way out of. But one of the first things we can do is say to China: Stop cheating.

We also have C. Fred Bergsten, a former Assistant Treasury Secretary, saying this:

I regard China's currency policy as the most protectionist measure taken by any major country since World War II.

Over the years, we have debated fair trade and free trade, whether it is protectionist to stand up for American businesses or workers, and here we have an expert saying to us that China's policy on currency manipulation is the ``most protectionist measure taken by any major country since World War II.''

The reality is, we can compete with anybody and win--and we will. But it is our job to make sure there is a level playing field. This is about American competitiveness. This is about being a global economy and making sure the rules are fair, making sure everybody is following the same rules, and then let's go for it. I will put America's ingenuity and entrepreneurship, research and development, and skilled workforce up against anybody's.

Some say--and we have heard from the highest levels of the Chinese Government--it could spark a trading war if we stand for our businesses and require there be a level playing field. We know we have a complicated relationship with China. We borrow funds to offset our debt. But we also are the largest consumer market in the world. They want to be able to sell to us. I cannot believe they will decide that they suddenly don't want to sell to the United States all those things they make, the largest consumer market in the world. The difference is, they would not be able to cheat, to get artificial discounts that will hurt an American small business that is making the same product.

As for the American textile industry, I had an opportunity to visit some folks who make denim for jeans and folks in the cotton industry and talk about competitiveness and what this protectionist policy in China is doing to the American textile industry, which is beginning to come back--and will come back if, in fact, there is a level playing field on trade. But they are up against a situation where they artificially are facing a 28- to 30-percent discount because of currency manipulation. Yet they are still competing. Can you imagine if the rules were fair?

This is about American competitiveness, and it is about the fact that we are responsible for making sure there is a level playing field for American businesses and American workers. We will not have a middle class in this country if we don't make and grow products. We want to make products here and grow products here and the jobs will be here and then we are happy to export products. We want to export our products, not our jobs. That is the difference. We are sick and tired of exporting our jobs because of the fact that China does not follow the rules. Enough is enough. After more than 10 years, they have not had to step up and do what they are supposed to be doing under the agreements they have entered into. Enough is enough.

Again, I look forward to our final vote on this legislation. I think this is a very important moment, at a time when there are many disagreements, and there have been many difficult times in the Senate--being able to move forward and take action, the fact that colleagues on both sides are standing together on behalf of businesses and workers at every corner of this country, saying we are going to fight for American jobs and businesses, large and small, and we are going to make sure we create a level playing field so we have the competitiveness structure we need in this country, because we know if we have that level playing field, there is nothing that can stop American ingenuity and American workers, who are the best in the world and will continue to be.

I urge adoption of this bill and congratulate all my colleagues who have been involved with this issue for many years--colleagues on both sides of the aisle. I am very pleased we have been able to get the legislation to this point. It is now time to act on behalf of American workers and American businesses.

I yield the floor and suggest the absence of a quorum.


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