FARRELL English: Put tariffs on China goods

He says his proposal would compensate for China's currency manipulation.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
FARRELL, Pa. -- U.S. Rep. Phil English says China is unfairly manipulating its currency to undercut American manufacturers with its exports and he has come up with a plan to correct the situation.
The congressman, speaking Thursday at Duferco Farrell Corp., unveiled The Currency Harmonization Initiative through Neutralizing Action (CHINA) Act of 2003.
English of Erie, R-3rd, is one of three prime sponsors of the legislation that would slap high tariffs on Chinese imports. The bill already has picked up 75 co-sponsors.
"I am unveiling concrete measures to fight back against unfair Chinese imports that are devastating much of our manufacturing," English said.
China artificially has pegged its currency, the yuan, to the American dollar. As the value of the dollar goes down, the Chinese devalue the yuan when it should be appreciating, English said.
The result is that China is able to severely undercut American manufacturers, he said, noting the $103 billion trade deficit with China is affecting steel, textiles, hardwoods and more and is expected to grow to $120 billion this year.
Plant closing
The decision by the Werner Co. of Greenville to close its ladder manufacturing operation earlier this year and move it elsewhere at the cost of 500 local jobs could be a direct result of China's behavior, English said. Werner said at the time that low-cost producers in China and Mexico had seriously cut into its market.
"My bill will put the onus on China to bring its currency back up to its real value and erase their price advantage. If they fail to play fair, they would then face tariffs up to 40 percent," English said.
The bill would direct the U.S. Secretary of Treasury to analyze and report to Congress whether China is manipulating its currency to gain a trade advantage. If it is, the Treasury Department must levy tariffs against China equal to the percentage of manipulation found.
Granting China most-favored nation trading status in 2000 was the right action at the time because it got China into the World Trade Organization, and that might be helpful, English added, noting there is still time to negotiate the currency issue with China before his bill becomes law. It should come up for a vote in early 2004.