Chinese Currency Act of 2005

Mr. Speaker, I yield myself 3\1/2\ minutes.

Mr. Speaker, the argument from the other side of the aisle that this issue is somehow tied to CAFTA, I think, is particularly striking and particularly odd because the underlying bill that we are considering today should be on the consent calendar; it should not be controversial with the bulk of people in this Congress who care about the American economy.

Mr. Speaker, today the House has the opportunity to vote on a bill that will take the largest step toward strengthening our trade remedy laws in over 15 years. This bill is a comprehensive approach towards eliminating many of the inequities that exist in our trading relationships, particularly our bilateral U.S.-China trade relationship. It holds China and others accountable and creates tough mechanisms to ensure compliance with trade agreements and provides tools for us to gain compliance should our trading partners, particularly China, fail to do so.

Voting for this bill today will send a strong signal to Beijing that Congress will not sit idly by while China's mercantilist trade policy injures U.S. employers and costs us jobs. Voting for this bill today will send a strong signal to China and every country that this Congress will do what it takes to ensure that our trading partners fully abide by the rules and are not rewarded with unfettered access to our market when they are not prepared to make the tough choices to follow the international rules.

It is clear that voting against this bill will send a very dangerous signal that this Congress is willing to turn a blind eye to Chinese complacency and we continue with the status quo of unfairness to our producers.

Mr. Speaker, this bill is a strong, responsible, and comprehensive initiative that would close an existing loophole that bars the use of the countervailing duty law against nonmarket economies such as China. Right now a major tool in our arsenal is unavailable in dealing with a nonmarket economy or communist countries. It is ridiculous that when we find subsidies in France, Japan, Brazil, or Taiwan, we can use countervailing duties to strip the benefits of those subsidies, but we cannot do so if we find the same subsidies in China or Vietnam.

This bill would establish a strong and external system to audit China's compliance with trade obligations on intellectual property rights, market access, and transparency; and it would place Congress strongly on the record as opposing attempts to use the WTO to water down domestic trade law protections.

It would require the Treasury Department to define currency manipulation and clarify legal protections against China and other countries that manipulate their currency. It would increase funding for the United States trade representative to create more trade cops to improve enforcement of existing trade laws.

By replacing current bonds that are used by new shippers in antidumping cases with cash deposits, we are dealing with one of the biggest loopholes.

Finally, it would authorize funding for the International Trade Commission.

Mr. Speaker, passage of this legislation is essential for the economic future of the next generation, for the future of good-paying jobs in places like northwestern Pennsylvania where we make things for a living. We need this legislation passed by a Congress willing to come together, to put aside its political differences, and certainly not vote down this legislation merely for political positioning on another trade agreement.

Mr. Speaker, I urge passage of this key legislation. This is the top trade vote of this year, and everyone will be counted on it.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentleman from Florida (Mr. Shaw), the distinguished chairman of the Subcommittee on Trade.

Madam Speaker, I yield 1 minute to the gentleman from Arizona (Mr. Hayworth), a distinguished member of the Committee on Ways and Means.

(Mr. HAYWORTH asked and was given permission to revise and extend his remarks.)

Madam Speaker, I yield myself 30 seconds.

First of all, the last speaker appears to have read the other party's bill, not ours. The Democrats' bill is actually weaker than our bill because it ignores a recommendation by the GAO to authorize the Commerce Department to use third-country information in countervailing duty cases against China consistent with China's WTO accession commitment. Without this provision, the countervailing duty provision would be difficult to use and could be subject to endless court challenges. They have simply misread this legislation and done it in an egregious way.

Madam Speaker, I yield 1 minute to the gentlewoman from Connecticut (Mrs. Johnson), a distinguished member of the Committee on Ways and Means.

Madam Speaker, I yield 1 minute to the gentleman from Indiana (Mr. Chocola), a distinguished member of the Committee on Ways and Means and an authentic advocate of fair trade.

Madam Speaker, I yield 1 minute to the gentleman from New York (Mr. Reynolds), a distinguished advocate of fair trade and a member of the Subcommittee on Trade.

(Mr. REYNOLDS asked and was given permission to revise and extend his remarks.)

Madam Speaker, I yield 1 minute to gentlewoman from Pennsylvania (Ms. Hart), a distinguished member of the Committee on Ways and Means and a member of the executive committee of the Congressional Steel Caucus.

Madam Speaker, I yield 1 minute to the distinguished gentleman from Michigan (Mr. Rogers), one of the key players in developing this legislation.

Madam Speaker, I yield 1 minute to the distinguished gentleman from South Carolina (Mr. Barrett), another strong advocate of fair trade for American workers and American farmers.

Madam Speaker, I yield 1 minute to the gentleman from Pennsylvania (Mr. Murphy), a very distinguished advocate of fair trade.

Madam Speaker, is my understanding correct that the gentleman has only himself as the remaining speaker with 4 minutes?

Madam Speaker, I yield 1 minute to the gentleman from Indiana (Mr. Souder), a very distinguished member of the Steel Caucus, an advocate of the cause of fair trade.

(Mr. SOUDER asked and was given permission to revise and extend his remarks.)

Madam Speaker, I yield myself the balance of my time.

Madam Speaker, I would like, in this closing minute, to cut through the fog of process arguments and weird Alice in Wonderland illusions to linkage to other trade agreements. This is important legislation, and it is important in itself, and it deals directly with key problems that we are having in our trade relations, particularly with China.

This legislation closes loopholes, not creates loopholes. It allows us, for the first time, to apply countervailing duties to nonmarket economies. That is a good thing. I realize our friends on the other side of the aisle never engaged on the SOS bill, the underlying core of this bill, nor cosponsored it. I realize that they have been behind the curve on this.

We have to move today and put this on the calendar today so that we can move quickly to send a message to China that we are going to close the loopholes, that we are going to audit their compliance with their trade obligations, that we are going to oppose the WTO watering down our domestic trade relations; and we are determined to put more money into trade so that we can enforce these agreements.

If you care about China, if you care about trade, vote for this bill and avoid the petty partisan politics.

Madam Speaker, I yield back the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, we object to the suspension calendar being used for political purposes. As most of us know, this calendar is supposed to be used to expedite legislation that is not controversial and has no substantial opposition. One would hardly believe that this bill is on the calendar today for purposes of improving our trade relationship with the People's Republic of China.

Clearly, for those who are following the Central American Free Trade Agreement with the Dominican Republic, they know that this is another effort to elicit votes for a bill that has not got bipartisan support and should have bipartisan support. I think it is bad policy and bad politics for our foreign policy and certainly our trade policy to be used in an effort to solicit votes or to be done in a partisan way to see who won and who lost.

The chairman of the committee is right that the Democrat side as well as working with the gentlewoman from Connecticut (Mrs. Johnson) is very anxious to clear up the complexities that put the United States at a disadvantage as relates to dealing with the Chinese Government. But at the same time, we truly believe that these bills should not be the Rangel bill with Democrats or the English bill with Republicans, but rather a bill that we can say as members of the Committee on Ways and Means and as Member of Congress that we have taken it to the committees, we have had hearings, and we have come out with a position that you do not have to check the party to know whether it is right or whether it is wrong.

There is a substantial difference between the bills that the Democrats put in, which certainly deals with the provisions that are in the bill before us today, but also it prevents the loopholes that are in that bill and provides for other considerations that would make this a better bill and improve our relationship with China.

Again, Mr. Speaker, this bill has nothing to do with China and has everything to do with an attempt to get votes for DR-CAFTA. We hope that a vote against this bill will send a message to Democrats and Republicans not to use the procedures of the House for political purposes; to not put controversial bills on the suspension calendar, and to take them to the committee of jurisdiction where they belong so that they can be discussed, debated, and then brought to the floor in a bipartisan way so that we can look at it.

Mr. Speaker, I hope this bill is pulled so that we do not have to take a vote on it.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 3 minutes to the gentleman from Maryland (Mr. Cardin), the distinguished ranking member of the Subcommittee on Trade.

Mr. Speaker, I yield 3 minutes to the gentleman from Michigan (Mr. Levin), a former ranking member of the Subcommittee on Trade of the Committee on Ways and Means.

(Mr. LEVIN asked and was given permission to revise and extend his remarks.)

Madam Speaker, I am pleased to yield 2 minutes to the gentleman from Ohio (Mr. Ryan).

Madam Speaker, I yield myself such time as I may consume.

I think this discussion, especially the opposition to the Rangel bill by the gentleman from Pennsylvania (Mr. English), just shows the complexity as well as sincerity of those people that would like to put some checks on the conduct of the Chinese trade people and I think emphasizes why this bill should not be on the suspension calendar.

Madam Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Kucinich).

Madam Speaker, I yield 3 minutes to the gentleman from Massachusetts (Mr. Neal), a member of the Committee on Ways and Means.

(Mr. NEAL of Massachusetts asked and was given permission to revise and extend his remarks.)

Madam Speaker, I reserve the balance of my time.

The gentleman from Pennsylvania is correct.

Madam Speaker, I yield myself the balance of my time.

One of the major reasons why we are opposing this bill is because of the process. Clearly a bill is supposed to be brought to this floor when it has overwhelming support, when it is a simple bill, naming a post office, having a stamp, declaring mothers as being essential for parenthood, things that Republicans and Democrats can look up at the scoreboard and see that we have 435 Members or close to it supporting it.

How can anyone perceive, as one of the Members on the other side said, the most important trade legislation that we ever had will be put on just for 40 minutes debate? The qualities that exist in the English bill, we have been able to see some loopholes. He and I would want to work together to close those loopholes. All the members of the Committee on Ways and Means feels the same way about trying to do something to contain the overreaching of China. What makes the other side believe that we Democrats are not entitled to participate in the substantive nature of sensitive, complex legislation?

Putting this on the suspension calendar, in my opinion, is an insult to Members on both sides of the aisle and is an insult to those people who oversight what we do, because the suspension calendar means that we never thought that they would ever have a problem with it, and that is why we did not share what is in this bill.

I also think that it is really unfair to have the Members of Congress to believe that this bill comes to the floor because of its importance and therefore has to be passed on the suspension calendar. We have plenty of time to work in the Committee on Ways and Means in dealing with this so that we can be proud that we do not have a Rangel bill or an English bill or a Republican bill or a Democratic bill. The pride should come when we have a congressional bill which we can say both sides have an opportunity to hear witnesses; to see what the impact is going to be, whether it is going to work or not work; to see whether those who have fought to put checks on China feel satisfied that we have done it; and to be able to say to foreigners that we may have differences among ourselves, political differences, but when it comes to trade policy, we speak with one voice. The flag is up, and we speak for the United States of America.

So I recognize how important it is to pass the DR-CAFTA bill. I recognize that there is a problem because Democrats were not involved and Republicans cannot get the votes. But I do not know how many suspension bills they are going to bring in as an excuse to get Members to say, I got them to talk about China, and therefore I am going to vote for CAFTA.

It is not enough to talk about China and the problems that we face. What we should be doing is bringing these issues up in the committee that has jurisdiction, and we are so proud of it, and to make certain that the best we can is to have this as a bipartisan effort on both sides.

So this is not the first time that the committees of jurisdiction have had to have Members bypassed in terms of their input, bypassed in terms of the ability to have amendments, and bypassed in terms of saying that we have to find some way to find some bill that we can get bipartisanship on it. The vehicle to do this normally, from the record of the Congress, are the suspension bills. But trade bills should not be on the suspension calendar.

Madam Speaker, on that I demand the yeas and nays.

Madam Speaker, I thank the gentleman from Pennsylvania for his leadership.

It has been alleged here on the House floor that this is a trade for CAFTA, to get some of our votes. Let me be real blunt. It was for me. I took it to the President, the Vice President, our trade ambassador, the Secretary of State, because we have had no action on China. Whether it was a Democratic President or a Republican President, we have had no action on China. Whether it was a Democratic Congress or a Republican Congress, we had no action on China. Every single time we come up for a vote, we get rolled.

We have to hold China accountable. This is not perfect, but a vote against this bill is a vote for China, not for the United States. It is a small step, but a critical step. Without the data, if they do not let their currency float, how in the world do we measure how much they are manipulating the currency? And those critics of those of us who have been putting pressure on China in the last few weeks said we could never get them to reevaluate their currency. It was a little, piddly step, but 2 percent is 2 percent. It is a big admission that they have been manipulating their currency.

So rather than declare victory and rather than saying we finally, it looks like, are going to pass a bill on China, the other side wants to take it down, or at least a few Members.

We had better pass this bill, or this is yet another victory for China, and we will never get anything done except at critical moments when they need our votes.

I rise in support of H.R. 3283, the United States Trade Rights Enforcement Act.

The outcry from American manufacturers has never been louder. China is destroying many American businesses. For too long, warnings of these businesses have been ignored. The American government has negotiated with China, talked to China, cajoled China, but has declined to act decisively and with concrete measures to combat China's policies and help American manufacturers. I applaud those at the United State Trade Representative office who have the daunting task of dealing with the Chinese government, but unless talk is backed-up with action, it really doesn't matter.

Congress has also been reluctant to help where China is concerned. Although we have passed several resolutions condemning Chinese trade practices, they are meaningless, and do nothing to actually help businesses. Often it seems that the piracy of music and movies is worth administration and congressional action but the piracy of manufactured goods or China's deliberate undercutting of manufacturing through suspect trade policies does not warrant action.

The hollowing out of American manufacturing does warrant action. Although China's economy is moving toward the free market, China remains an avowed communist country. The Communist government and the army own countless businesses, including the Chinese National Overseas Oil Company, which recently made a bid for Unocal. They prop up many businesses with free or reduced-cost energy, low cost or no-cost loans and financing, and sometimes forced labor. Because of Chinese government intervention in the economy, Chinese businesses are not subject to the same market forces as American businesses.

American businesses have also been enticed to set-up shop in China. In addition to cheaper labor costs, businesses in China do not have to worry about clean air, clean water, OSHA, or compliance with a crushing regulatory burden.

Although these things put American businesses, particularly manufacturers, at a disadvantage, the biggest distortion of the market is China's currency manipulation. Until last week, China pegged its currency at 8.28 yuan to the dollar. Despite huge growth in the Chinese economy and explosive international trading, the Chinese government refused to revalue its currency. Estimates of China's currency manipulation were anywhere from 20-80 percent. This meant that Chinese goods entering the United States were 20-80 percent cheaper than they should have been. And American goods were 20-80 percent more expensive.

Last week, the Chinese government revalued the yuan by slightly over 2 percent. While I applaud this movement on the part of the Chinese, there is much more that needs to be done. I realize that the Chinese cannot adjust their currency overnight but I expect this latest devaluation to be the first of many. I also expect the Bush administration and future administrations to keep pressuring China to restructure their financial sectors and currency schemes so that they better match those of the market-oriented world. Their currency needs to flock and let markets determine the value, not the government.

As American manufacturers have been severely damaged by unfair Chinese policies, the necessary tools to fight this unfair competition have not been available to them. One important tool is tHe countervailing duty, CVD. Countervailing duties are taxes assessed to counter the effects of subsidies provided by foreign governments to goods exported to the United States. Subsidies cause the price of such merchandise to become artificially low, which may cause economic ``injury'' to U.S. manufacturers.

One thing is sure, the artificially low price of Chinese merchandise has caused injury to American manufacturers. Unfortunately, the most recent interpretation of American trade laws does not allow CVDs to be applied to non-market economies. H.R. 3283 will explicitly allow them to impose CVDs on non-market economies. It will allow investigators to compare China with comparable market economies, most likely India, in order to see just how

much the Chinese government is unfairly aiding its businesses. This will not save American manufacturing overnight but it will help to level the playing field, and allow fair competition in the global marketplace.

This legislation comes to the Floor at the same time as legislation to implement the Central American Free Trade Agreement, CAFTA. I am one of many Members that withheld support for CAFTA in exchange for concrete action on China. Some have criticized the efforts to link China and CAFTA. They argue that they are two different issues. I disagree. CAFTA has been sold with the promise that it will open up new and bigger markets for American manufacturers. That may be, but if manufacturers in my district are put out of business because of unfair competition from China, whether or not they have access to markets in Central America will be irrelevant because they will be out business.

I urge all of my colleagues in the House and the Senate to vote for this necessary tool against unfair trade practices.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 3283) to enhance resources to enforce United States trade rights, as amended.

Mr. Speaker, I yield myself such time as I may consume.

The United States Trade Rights Enforcement Act, as amended, is a compendium of a number of positions that have been expressed in a bipartisan way by Members of this House in regard to some of our trading partners.

This bill has been identified as an ``anti-China'' bill. That simply is not the case. The provisions to assist us in determining how you examine a nonmarket economy and determine whether or not it is carrying out practices that are in violation of the WTO is applied to any country with a nonmarket economy.

It is true that there are monitoring provisions dealing with agreements that China has voluntarily laid on the table; for example, moving away from the Government of China using counterfeit software and, therefore, protecting intellectual property rights, and China assigned itself the date of the end of calendar year 2005. This merely creates a monitoring process to determine how it can be achieved.

The bill is very timely because it includes another monitoring process just recently announced by the Government of China dealing with its currency, its desire to unpeg its currency to the U.S. dollar and have it move modestly against a basket of world currencies. That also, in this legislation, would be monitored.

I am pleased to say that the gentleman from New York (Mr. Rangel) and the gentlewoman from Connecticut (Mrs. Johnson) have examined and offered a resolution on the government procurement agreement of the World Trade Organization urging China to fully participate. That is included as well.

This bill is designed to meet a number of Members' particular concerns focused on world trade, not just China. For example, additional money is being provided to the United States Trade Representative for enforcement purposes. Yes, it includes the Office of China Affairs, but I do want Members to know it also includes the Office of Japan, Korea, and Asian Pacific Affairs because there are several provisions in here monitoring, frankly, the Government of Japan based upon its unfair trade practices, most focused on the use of so- called sanitary and phytosanitary measures as, in fact, nontariff trade barriers.

So this is a compendium of concerns presented at a time that the trade issues will be in front of us this week, and leadership felt, and I agree as well, that this measure allows us to focus beyond this hemisphere, in fact, at major trading partners and behavior that we have seen not just in terms of providing tools to enforce U.S. trade rights, but to monitor personal individual and voluntary commitments made by governments as well.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I find it ironic that the gentleman from New York (Mr. Rangel) would call this bill controversial. Perhaps there may be some envy as opposed to who gets credit, and I apologize for mentioning his name if that is his concern. What we do not want to do is engage is unnecessary bashing, as it has been said.

This is a responsible bill. Some of the other measures, and we saw that in the

hearings that the Committee on Ways and Means has had over China and other trade concerns, this bill is backed by hearings notwithstanding what the gentleman from New York (Mr. Rangel) said. But most of the other pieces of legislation in fact violate the very WTO rules that we desire China and other nations to follow.

This bill does not do that. It is a responsible bill responding in ways that are appropriate. Inappropriate responses that actually violate the WTO rules when trying to make the point that other nations should follow them is, in fact, irresponsible.

Mr. Speaker, I ask unanimous consent to yield the remainder of my time to the gentleman from Pennsylvania (Mr. English) who has been instrumental in producing this bill, and that the gentleman from Pennsylvania (Mr. English) may control the remainder of the time.

Madam Speaker, I recently hosted roundtables with manufacturers in my district. Whether it is currency manipulation or unfair subsidies, it is clear that our local employers have long had enough of the way China cheats on trade.

As John Hoskins of Curtis Screw in Buffalo told me, they have ``never been afraid to compete globally.'' But this century-old manufacturer can only compete globally if they can compete fairly, and they note that some of their Chinese competitors have much of the cost subsidized by the government.

``To put this in perspective,'' he said, ``the only way . . . U.S. manufacturers can compete . . . is if the United States Government begins to pay for our building, our labor, and employee benefits and . . . other costs of doing business.'' That is exactly what the Chinese are doing today.

The United States Trade Rights Enforcement Act will help combat illegal subsidies, provide additional funding for enforcement of trade laws, and make certain that our products and services have fair access to Chinese markets, all critical aspects of our fight to ensure fair trade.

I commend the gentleman from Pennsylvania (Mr. English) and the gentleman from California (Chairman Thomas) for their hard work on this issue, and I urge my colleagues on both sides of the aisle to support this legislation.

As a long-time champion of fair trade and a lead cosponsor of this legislation, I rise in strong support of the U.S. Trade Rights Enforcement Act.

When China was permitted to join the World Trade Organization in 2001, there was an implicit promise made to American businesses, workers, and consumers--that we would get a fair deal in our trade relations with the Chinese. Yet, in so many areas--intellectual property rights, currency valuation, subsidies, trade barriers, you name it--we see China failing to uphold its end of the bargain by ignoring international trade norms.

The bill includes a variety of measures that will help bring an end to unfair trade practices abroad, and level the playing field for American companies and workers. The countervailing duties provision is especially important for local manufacturers.

It's an important instrument for U.S. businesses trying to successfully combat illegal subsidies; and it is a big reason why the National Association of Manufacturers (NAM) has expressed its strong support for this measure.

I recently hosted roundtables with manufacturers in my district; and whether it's currency manipulation or unfair subsidies, it's clear that our local employers have long had enough of the way China cheats on trade. As John Hoskins of Curtis Screw in Buffalo told me, they've ``never been afraid to compete globally.'' But this century-old manufacturer can only compete globally if they can compete fairly, and they note their Chinese competitors have much of their costs subsidized by the government. ``To put this in perspective,'' he said, ``the only way * * * U.S. manufacturers can compete * * * is if the US government begins to pay for our building * * * our labor, our employee benefits and * * * other costs of doing business.'' ``That's exactly what the Chinese are doing today.''

I have always maintained that our products and our workers can compete anywhere, with anyone in the world, as long as that competition is fair.

This bill will help combat illegal subsidies, provide additional funding for enforcement of trade laws, and make certain that our products and services have fair access to Chinese markets--all critical aspects of our fight to ensure fair trade.

I commend Congressman English and Chairman Thomas for their hard work on this issue; and I urge my colleagues on both sides of the aisle to support this bill.