China

The Next Debate: China and Trade Deficit

Dave Johnson — Fri, 19 Oct 2012 14:56:15 -0400

Monday's final campaign debate focuses on foreign policy. Will it focus on our policy of running huge trade deficits with China? Every dollar of trade deficits makes our country a dollar poorer. That trade deficit is the deficit that our Washington elites should be worried about.

The China Trade Deficit

For some reason, when we close a factory here,lay off the workers and ship the equipment to China, and then ship the same goods back here to sell in the same stores, that is called "trade." And when we buy vastly more stuff from China than they buy from us, that is also called "trade."

We have a huge "trade" deficit with China. We sent China $28.7 billion dollars in August alone - $295 billion last year. So in one year we transferred $295 billion of our wealth to China.

The trade deficit not only drains the economy and our jobs, it sends essential pieces of our industrial ecosystems out of the country. And this means that it is sending our ability to make a living in the future out of the country, too.

President Obama is working to double American exports, but imports also continue to rise. The problem here is that even if we double exports we continue to drain our economy if the export increase doesn't catch up to the level of imports.

From Trade Deficit - One Root Of Many Problems,

You buy things till your wallet is empty. So you raid the savings account to buy more stuff. Then you get a loan, and buy more stuff. Another loan, another, you keep buying stuff... Finally you're selling off the tools you had used to make a living. That's where the country is now because of the huge imbalance in our trade relationships. We buy more from them than they buy from us and we have let this go on and on and on. This is the deficit we should be worried about.

Trade Deficit Costs Jobs

From, Report On Job Cost Of Trade Deficit With China,

A new report, The China Toll, takes a look at the effect of our trade deficit with China since that country joined the World Trade Organization (WTO) ten years ago, and comes up with some very specific numbers. In summary:

"Growing U.S. trade deficit with China cost more than 2.7 million jobs between 2001 and 2011, with job losses in every state"

The Economic Policy Institute (EPI) released the report, The China toll, Thursday.

According to the report,

Between 2001 and 2011, the trade deficit with China eliminated or displaced more than half of all U.S. manufacturing jobs lost over that period. The growing trade deficit with China has cost jobs in every congressional district in all 50 states as well as in the District of Columbia and Puerto Rico.

The total losses include 662,100 jobs from 2008 to 2011 alone—even though imports from China and the rest of the world plunged in 2009 before recovering and surpassing the previous peak reached in 2008. The trade deficit in the computer and electronic parts industry grew the most, displacing more than 1 million jobs in high-tech industries. In fact, rapidly growing imports of computer and electronic parts, including computers, semiconductors and audio-video equipment, accounted for nearly 55 percent of the $217.5 billion increase in the U.S. trade deficit with China between 2001 and 2011.

Again: Half of our manufacturing job loss is lost to the trade deficit with China. ... The trade deficit in the computer and electronic parts industry grew the most, displacing more than 1 million jobs in high-tech industries.

Trade Deficit Makes Workers Afraid

The trade deficit and resulting job loss makes workers afraid, so they work longer hours, skip vacations and accept cuts in wages and benefits, which also hurts the economy. From Job Fear From Trade Deficit Is What Happened To Jobs And The Middle Class,

The middle class is disappearing. Our economy is "hollowing out" because the money goes to the top and the people fall to the bottom. This is because we allow American companies to close factories here and open them there, shipping the same goods back here to sell in the same stores, costing jobs, companies, industries and our economy. This makes us afraid for our own jobs and afraid to make waves. By helping a few at the top get fabulously rich, China has essentially recruited our own businesses leaders to fight against our own government - and us.

Trade Actions

The President has filed several trade complaints against China, including actions involving tires, steel pipes and solar panels. This has made a difference. Just yesterday the WTO found in favor of the United States in a dispute challenging China’s imposition of duties on U.S exports of grain oriented flat-rolled electrical steel (GOES). This ruling ensures that American workers and businesses that make certain types of steel won’t face Chinese retaliatory tariffs.

But these trade actions are just one piece of the big puzzle. Another piece is confronting China's currency manipulation.

The Currency Problem

China manipulates their currency. Because their currency is "weak" goods made there cost as much as 30% less than goods made here, even before you take into account the effect of various Chinese government subsidies and other trade cheating.

There is a bill in Congress to crack down on China's currency manipulation. This is a bipartisan bill that has passed the Senate. In past years this bill has overwhemingly passed in the House, and the current bill has more than 60 Republican co-sponsors.

But that bill cannot get a vote in the House, even with more than 60 Republican co-sponsors. Wall Street's front group The Club For Growth has made the currency bill a litmus test. Politico: Club for Growth warns GOP on China currency bill,

The influential Club for Growth is pressuring Republican presidential candidates and lawmakers to oppose bipartisan legislation cracking down on China’s currency policies.

... The Club for Growth has urged lawmakers to vote no on the bill, warning that the vote will be included in the group’s 2011 Congressional Scorecard, used to measure how fiscally conservative they are.

So Speaker Boehner refuses to bring the bill to the floor for a vote -- because it will pass. And the 60+ Republican co-sponsors in the House refuse to sign a discharge petition that forces the bill to come to the floor for a vote because they fear retaliation from Wall Street.

Romney Says he Will Crack Down On China, Refuses To Actually Crack Down On China

On the campaign trail Mitt Roney says he will crack down on China. He says he will do something about China's currency manipulation on the first day he is in office.

But there is something he will not do: he will not actually crack down on China right now, by pressuring Boehner to bring the currency bill to the floor, or by asking the 60+ Repubican co-sponsors of the bill to sign a discharge petition.

If Romney wants to crack down on China he should crack down on Boehner and House Republicans right now. This needs to be part of Monday's final campaign debate.

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Hey check out what happens when you click these:

Is This Why Romney Won't Talk To Sensata Workers Whose Jobs Are Being Shipped To China?

Dave Johnson — Wed, 10 Oct 2012 14:17:14 -0400

On the campaign trail Romney says we shouldn't ship jobs to China and should "crack down" on China trade problems. But he refuses to help or even meet with the Sensata workers whose jobs are being shipped to China right now.

Why the refusal to line up his actions with his promises? A must-read, must-read, must-read news report explains how part of Romney's $400,000/week income comes from ... get this ... shipping jobs to China!

First, the background...

Sensata - Happening Today

Mitt Romney started the "private equity" firm Bain Capital. Bain purchases companies using "leveraged buyouts" that borrow huge sums using the purchased company's own assets as collateral, uses the borrowed money to immediately pay itself, then cuts costs by doing things like sending jobs to China, cutting wages and manipulating tax rules to cut taxes owed, along with standard big-business practices like consolidating business units, taking advantage of economies of scale not available to smaller competitors, squeezing distribution channels for price cuts, and other practices that bring competitive advantages. (See So DID Mitt Romney Really "Create Jobs" At Staples?) After reorganizing the purchased companies Bain then "harvests" them for profit.

One company Bain Capital purchased is Sensata, a sensor manufacturer that makes key components for our automobile supply chain. Sensata then announced it is closing a factory in Freeport, Ill., and sending the manufacturing and jobs to China. (China is engaged in efforts to dominate American auto supplies. See China Cheating Costs 400K Auto Parts Jobs and Why The Latest Trade Complaint Against China Matters.)

Bain/Sensata brought in Chinese workers and made the Freeport workers train them. Bain/Sensata is moving the equipment out of the Freeport factory and shipping it to China right now. The Freeport employees have set up a camp outside the factory that they call Bainport and are trying to stop the Bain trucks that are moving the equipment out for shipment to China. Supporters were arrested this week, trying to stop those trucks.

The Sensata employees heard Romney on the campaign trail, and somehow got the idea that he opposes sending our jobs to China. So they asked him to come to Freeport/Bainport and help them. Read on to learn about Romney's response to the Sensata workers, and how Romney is actually making big money right now from shipping their jobs to China.

"The week before they came they took the American flag down outside the plant. The week after they left they put it back up."

The China Problem – The Public Gets It

During the George W. Bush administration we lost more than 50,000 factories and at least 6 million manufacturing jobs directly to China. (Never mind the effect on the supply chains, the grocery and clothing stores where those people shopped, etc... The foreclosures, the bankruptcies, the misery...) Thanks, George!

This chart from Think Progress shows what happened to our manufacturing base immediately after Bush took office. Seriously, look at this chart and see if you can just guess why we have such a terrible economy today:

The public gets it – the problem is China. Polls show that the public overwhelmingly – by percentages in the 80s and 90s for Democrats and Republicans alike – understands that a huge part of our economic troubles come from the was we have been shipping jobs, factories and industries to China.

ABC News, from July: ‘Made In America’ Policies Hugely Popular, Survey Shows

Nearly 9 out of 10 Republicans and Independents and 91 percent of Democrats said they support “Buy America” preferences, according to the survey, which was conducted by the Democratic-leaning Mellman Group.

Another poll,

When it comes to trade with China, the poll found that voters emphatically support tough action on Beijing’s cheating on currency and other trade obligations.

Another, from a key state: New Zogby Poll: Ohio Voters Favor Boycott of China Over Unfair Trade.

Romney Can Read Polls

One thing the Romney campaign can do is read polls. So Mitt Romney sees the polls and says he wants to do something about China.

The Hill: Romney, campaigning in Ohio, vows to stop China's 'cheating' trade practices

Bloomberg: Romney Ad Says He Will `Stand Up to China': Video

The Hill: New Romney ad says Obama won’t ‘stand up to China’ on trade, jobs

So, on the campaign trail Romney says he will stand up to China's cheating, and opposes companies that send jobs and factories to China.

Romney Refuses To Help – Even Talk With – Sensata Workers

Romney wants to be President, and polls show that the public overwhelmingly wants something done about the problem of jobs and factories moving to China, and the resulting was pressure that puts on the rest of us and on our economy. So Romney says he will do something about it.

But Romney's current actions are opposite his current words. He complains about China currency manipulation, but refuses to ask the Republican House leadership to bring the China currency bill up for a vote, and refuses to ask more than 60 Republican co-sponsors of that bill to sign a "discharge petition" that would force a vote.

And Romney refuses to even meet with Sensata workers. When asked if Romney would help these workers the Romney campaign says Romney will not do it:

"Governor Romney has not worked at Bain Capital for over a decade, but for four years President Obama has been presiding over an economy that is creating too few jobs and sending more jobs overseas. Despite the President being invested in Sensata through his personal pension fund, and the government owning a major Sensata customer in GM, President Obama has not used his powers to help this situation in any way."— Curt Cashour, Romney Campaign Spokesman.

Why is Romney saying he wants to do something about the trade problem with China, but refusing to actually do anything about the trade problem with China? Here is one possible reason why.

Romney Making Big Money From Bain Sending Sensata Jobs To China

A must-read news report today by Sharon LaFraniere and Mike McIntire in The New York Times explains. As Romney Repeats Trade Message, Bain Maintains China Ties (emphasis added, for emphasis),

Mr. Romney also has millions invested in a series of Bain funds that have a controlling stake in Sensata Technologies, a manufacturer of sensors and controls for vehicles, aircraft and electric motors that employs 4,000 workers in China. Since Bain took over the operation in 2006, its investment has quadrupled in value. Bain continues to own $2.6 billion worth of Sensata’s shares.

Two years ago, Sensata bought an operation that made automobile sensors in Freeport, Ill. At the first meeting with the plant’s 170 workers, Sensata managers announced that by the end of 2012 all the equipment and jobs would be relocated, mostly to Jiangsu Province. Workers have staged demonstrations, pleading for Mr. Romney to intervene on their behalf.

Chinese engineers, flown to Freeport for training on the equipment, described their salaries as a pittance compared with Freeport wages. Tom Gaulrapp, who has operated machines at the factory for 33 years, said he fears he will go bankrupt after he loses his job on Nov. 5.

“This goes to show the unbelievable hypocrisy of this man,” he said of Mr. Romney. “He talks about how we need to get tough on China and stop China from taking our jobs, and then he is making money off shipping our jobs there.”

So there you have it. Mitt Romney says he opposes sending jobs to China, and says he will "crack down" on China. But he refuses to do things that he could do right now that would make an actual difference right now. And it turns out that right now he is making big money from Sensata and other companies that are sending people's jobs to China right now.

Laying off American workers – usually shipping the jobs to China – and pocketing their wages for themselves is the story of the rise of the wealth of the 1%, and the decline of the American middle class. It is the Romney/Bain/Sensata business model. And the remaining workers have to do the jobs of the laid-off workers, often for lower pay, and are threatened with losing their jobs, too, if they don't like it.

Please read the entire New York Times report, As Romney Repeats Trade Message, Bain Maintains China Ties. There is much more there about Romney, China, Bain and the huge gap between what Romney says on the campaign trail, and how Romney made his current $400,000/week income and how Bain Capital still makes its money.

Visit the Bainport blog for pictures and details about the Sensata workers who are trying to stop the Bain trucks from shipping the equipment from the factory to China.

More On Sensata

You Should Know About Sensata - It's What The Election Is About

Election Or Not, What Happens To Sensata-Style Workers?

Blocking Bain Trucks To Save Jobs In Freeport – This Is An IMPORTANT Story

Breaking – Arrests At Sensata "Bainport" Camp

Also, see:

Bain Of Our Existence - Go-To place for stories and info about Bain Capital.

Unraveling The Romney/Bain Tax Story,

Romney, Jobs And China – Let's Connect Dots

Rights Report Describes Romney-Owned "Brutal Chinese Sweatshop"

Romney, Republicans Again Side With China Over US Companies

Ohio And China – One Side Promises While The Other Delivers

Update: Here is a Democracy Now! report:

Election Or Not, What Happens To Sensata-Style Workers?

Dave Johnson — Thu, 27 Sep 2012 14:48:46 -0400

A group of workers whose jobs are being outsourced to China is touring the "rust belt." They are trying to make an election point. But what about the day after the election?

Sensata Workers - More Jobs Going To China

Two weeks ago I wrote about the workers at the Sensata factory, You Should Know About Sensata - It's What The Election Is About,

Workers facing outsourcing by Bain Capital are camping outside the Sensata factory in Freeport, Ill. They are asking Mitt Romney to show up and help save their jobs. They say they will stay camped there until Romney shows up and stands with them – or with Bain.

Mitt Romney can can use this to show us if he wants to be president of the whole United States, or just president of, by and for the outsourcing 1 percenters.

All Mitt has to do is show up and help these workers. He says he is not part of Bain, and wants to be President of all of the country. Mitt Romney can can use this to show us if he wants to be president of the whole United States, or just president of, by and for the outsourcing 1 percenters. He could - and should - do that.

The Bain Workers Bus Tour

Workers from Sensata have left Missouri and are stopping in are stopping in Iowa, Wisconsin, Michigan, Ohio, Pennsylvania, Virginia, Florida, the presidential debate in Hempstead, NY -- and are (eventually) heading toward Boston where both Bain Capital and the Romney headquarters are located.They want Romney and Bain to ask them not to send their jobs to China. You can read about their progress at BainWorkerBus.com.

The thing is, these workers might be at this plant, run by this company, but there are millions of workers - millions - in the same boat. Or whose jobs have left or are leaving on the same boat, anyway.

The Chart That Says It All

It is more than just these Sensata workers -- they are a symbol of the damage that our terrible "trade" policies have done and are doing to our country. A company can just close a factory here, open it there, bring the same stuff back to sell in the same stores here and call that "trade?" And they can get tax breaks for doing that? They can use the threat of doing that to bust unions and cut our wages? Polls show that We, the People overwhelmingly want this changed, yet it doesn't change.

Look at the chart in this post at Think Progress: After Nearly A Decade Of Declines, Manufacturing Jobs Begin Rebound. It shows what happened to our manufacturing base literally immediately after George 'W' Bush took office. Seriously. Look at this chart and see if you can just guess why we have such a terrible economy today.

During the Bush administration we lost more than 50,000 factories and at least 6 million manufacturing jobs directly to China. (Never mind the effect on the supply chains, the grocery and clothing stores where those people shopped, etc... The foreclosures, the bankruptcies, the misery...) We have a huge trade deficit with China -- money that we send to China and then complain that there is not enough money to do things here.

Imagine how our economy would be doing if we had actual trade with China, where we buy things from them and they buy just as many things from us?

After The Election

After the election the country is going to be diverted into a battle over how much more damage we can do to ourselves. Instead of addressing the trade deficit -- the cause of our budget and jobs deficit -- our plutocrat-funded elites are going to play a Shock Doctrine game of whipping up hysteria about the budget deficit. They are going to terrify the public about "the fiscal cliff" that occurs when the Bush tax cuts expire, and when the deal that put off the hostage-taking over the debt ceiling cuts the military budget, and then the safety net.

Instead of addressing jobs and inequality and wage stagnation and trade and climate and crumbling infrastructure and manufacturing policy and, and, and, they are going to all try to outdo each other offering ways to cut the things that We, the People do for each other -- all to keep taxes low for the super-wealthy. Some call this the "Grand Bargain" where they offer up austerity -- working so well in Europe -- instead of jobs.

Bob Borosage wrote about an alternative approach. Since Jobs Fix Deficits, let's wait on attacking the budget deficit until there are enough jobs. He calls this a "Jobs Trigger" - enough jobs triggers the time to cut the deficit. From Good Jobs First: No Grand Bargain Without A Jobs Trigger,

Poll after poll shows that voters are concerned most of all about jobs and the economy. Yet in Washington and on the campaign trail, attention has turned to deficits and how to get our books in order.

[. . .] The presidential candidates and Congress should be pressed to adopt a budget version of the “jobs trigger.” Putting people back to work is the first step to getting our books in order. So Congress should pass a fiscal trigger as part of any grand bargain: Comprehensive deficit reduction measures will kick in only when the economy is moving, and unemployment comes down to 5 percent or so.

Please go read the whole post, We must all demand a jobs trigger after the election. Jobs first, then fix the deficits.

And to fix jobs, we have to fix "trade." We have to stop this idea that it is OK to close a factory here, open it there, then send the same goods back here to sell in the same stores, and use the threat of doing that to even more of us to force wage and benefit cuts, bust unions, etc.

Ohio And China -- One Side Promises While The Other Delivers

Dave Johnson — Wed, 26 Sep 2012 14:09:59 -0400

Ohio is the center of the Presidential election, and the center of the fight over manufacturing policy and trade policy. Polls overwhelmingly show that the public gets it that the trade deal with China is the core of the problem. So both campaigns are making promises to fix the problem. One difference, though, is that one side just makes promises while the other side has actually delivered.

Promises

Mitt Romney is well aware that Ohio voters overwhelmingly want action on China and is promising that he will take action on China's currency manipulation on the first day he is in office. However, he is not taking actions that he could take today -- actions that would show the public that he means it and show that he is able to lead the Congress to get things done. He could today, right now, immediately ask House Republicans to bring the China Currency Bill up for a vote. The bill has more than 60 Republican co-sponsors, and passed the Senate 63-35, with 16 Republicans voting yes.

Mitt Romney could prove he means it, cold prove he can lead, and could make a difference for Ohio's manufacturers right now. He could ask Speaker Boehner to allow this bill to come up for a vote, and if Boehner won't do it he cold ask the 60+ Republican House co-sponsors of the bill to sign a discharge petition asking that the bill they co=sponsored be actually voted on. This would force a vote, and Mitt Romney would have proven to Ohio voters that me actually means it.

This was discussed on a call yesterday with Ohio Rep. Tim Ryan. Isaiah Poole reported on the call in his post, Romney's Inaction On China Speaks Louder Than Words,

Ryan said in a call organized by the Alliance for American Manufacturing and the Campaign for America's Future that Romney has done nothing to break the legislative logjam, which makes his criticism of President Obama "laughable," he said. "They have zero credibility on this issue," he said of Romney and House Republican leaders.

... Romney has said in campaign ads that he would name China a currency manipulator "on day one," and on Monday campaign spokesman Andrea Saul underscored the pledge while accusing President Obama of "leading from behind on taking on China."

Ryan, however, said that it's Romney and House Republican leaders who are not leading at all. Ryan, who is one of the cosponsors of the bill with Rep. Sander Levin, D-Mich., said that if Romney was serious about the currency manipulation issue, "he should have been calling on Speaker [John] Boehner to bring up my bill, knowing that he would get 350 votes."

Note - audio of the call can be heard by clicking through to Isaiah Poole's post, Romney's Inaction On China Speaks Louder Than Words.

Deliveries

Some of the reasons that Ohio is swinging toward Obama in the election polling were outlined in the call with Rep. Ryan. Marcy Wheeler reports, in her post, Congressman Tim Ryan’s 4 Reasons Obama Is Winning Ohio,

...I asked Ryan for the four top reasons why Obama is doing so well in OH.

He listed, in order:

1. The auto bailout (Ryan’s district also includes GM’s Lordstown Chevy Cruze plant)

2. Obama’s successful WTO trade complaint against China’s tire dumping (which affected Akron)

3. The Administration’s investment in education and research

4. Mitt’s campaigning against Proposal 2, which protected collective bargaining for OH’s public workers

Point 1: Ohio's manufacturing economy - and American manufacturing generally - depends on the centuries-old ecosystem of suppliers, infrastructure, public schools, colleges and universities, tool-builders, designers, transportation systems, and the rest of the components that together enable manufacturing to occur and thrive. After the financial crisis both GM and Chrysler were having trouble getting the financial that would otherwise have been available to them, so the Obama administration stepped in and provided that financing. Had this not occurred that entire ecosystem would have collapsed. This would have meant that not only GM and Chrysler went under but all the of suppliers, etc., would have also gone under, and this would have cascaded into Ford and many other manufacturers collapsing as well.

Point 2: The tire industry is very important to Ohio. China was attempting to take over this industry by selling tires below cost. If they had succeeded in this tens of thousands of jobs, and many factories and their suppliers would have gone under. The Bush administration refused to file even a single trade complaint against China, and we lost over 50,000 factories and several million direct manufacturing jobs, along with their supply chains and corresponding jobs.

More Actions

The Obama administration recently filed a trade case against China for government subsidies of auto parts that are sold in the US. China is trying to seize the auto industry in the same way they were allowed to seize the steel and other industries. As described above, the auto industry is central to the American manufacturing ecosystem, and it is crucial to our future competitiveness that we maintain a level playing field, where American companies can fairly compete.

In the post, Why The Latest Trade Complaint Against China Matters, I explained,

Why This Matters

The auto industry is targeted for takeover by China because it is seen as a(nother) key provider of high-paying jobs, export revenue and therefore national economic strength. The Seattle Times explains, in WHY IT MATTERS: China's auto parts industry.

The United States, China and other governments see the auto industry as an important source of higher-paid jobs and export revenue. The 2008 global crisis fueled complaints in the West that Chinese policies on a wide range of industries might be wiping out jobs abroad.

Chinese automakers exported only about 500,000 autos last year, mostly to the Middle East, Southeast Asia and other developing markets. But its producers of tires, aluminum wheels, radios and other components are making inroads in U.S., European and Japanese markets. They have yet to break into the top ranks of suppliers along with companies such as Delphi, Visteon or Europe's Michelin and Bosch. At the lower end of the market, Chinese suppliers are increasing their global share, putting pressure on smaller Western competitors.

China's strategies, from the same article,

Beijing has an array of strategies to support industries targeted for development, ranging from clean energy to mobile phones to autos. Companies can receive tax breaks and low-cost bank loans, energy and land.

The WTO allows research grants and some other aid, but critics say China violates rules that prohibit making exports a condition of support. They say Chinese policies have encouraged auto parts manufacturers to shift production to China, hurting employment abroad.

The key:

Employment in the U.S. auto parts sector shrank by roughly half between 2001 and 2010, while U.S. imports of auto parts from China have increased seven-fold, according to the Obama administration.

Enough Ohio voters understand just how important auto, tire and other manufacturing jobs are to the state's economy, and the economy of the entire region and our country. Mitt Romney opposed the auto bailout, saying that the companies, their suppliers, their workers, the small businesses that depend on their workers, the communities where those workers and businesses reside, and the states the depend on those factories, suppliers, jobs and communities should all just be left to fend for themselves.

This election is a battle over whether we will be a fend-for-yourself economy -- or a we-are-in-this-together economy that understands ourselves as a country and understands manufacturing as an ecosystem of vital components. History -- and China and even evolution -- prove that nurturing ecosystems is what makes an economy function. Isolated individuals bravely striving on their own against mighty and powerful forces might sound great to the teenagers who worship Ayn Rand novels, but it just doesn't work in the real world.

Ohio Sen. Brown Pushes Revival Of China Currency Bill

Dave Johnson — Thu, 20 Sep 2012 13:15:09 -0400

The "China Currency Bill" has passed the Senate but is stalled in the House by Republican leadership. Republicans are trying to have it both ways on China and manufacturing, saying they want to do something, but blocking doing something. It could come to the floor and pass if just a few of the 60+ Republican cosponsors asked for it. Meanwhile Mitt Romney says he wants to do something about China currency but opposes actually doing something.

Ohio Senator Sherrod Brown is pushing to revive the China Currency bill that has passed the Senate and is being blocked by Republican leadership in the House. Columbus (Ohio) Dispatch: Senate Democrats press Boehner for vote on Chinese currency bill,

More than 20 Democratic senators -- including Sherrod Brown of Ohio -- are urging House Speaker John Boehner, R-West Chester, to allow a floor vote on the House on a bill aimed at making U.S. exports more competitive to China.

The bill, which passed the Senate by a 63-35 vote last year, would require the Obama administration to impose tariffs on Chinese exports to the United States if the U.S. Department of the Treasury concludes that China is keeping its currency artifically low. By doing so, critics charge that China can flood the United States with less expensive goods that hurt U.S. manufacturers.

"Legislation is necessary to actually give American businesses and workers tools to fight back,'' according to the letter, which was written by Brown.

Greg Sargent at The Plum Line, in Ratcheting up pressure on GOP (and Obama) over China,

Senator Sherrod Brown, the lead sponsor, is organizing to increase the pressure on his fellow Ohioan, John Boehner, to hold a vote on the bill. He is circulating a letter today among fellow Senators, addressed to Boehner, demanding a vote, and noting that a similar version passed in 2010 with the support of 80 House Republicans still in office.

... “I’m confident Obama will sign this bill,” Brown said, adding that his conversations with the White House had persuaded him of this. “This will pass if Boehner schedules it.”

Brown added that the bill, and the ideas behind it, resonate heavily with working class voters, such as those in industrial swing states like Ohio and Wisconsin. “People recognize that trade policy and tax policy have undermined the middle class and manufacturing,” Brown said. “The public knows the game has been rigged.”

Who Is Against?

Polling shows that Americans across the political spectrum overwhelmingly want changes, including a crackdown on currency manipulation, "Buy America" policies, ending tax incentives for offshoring jobs, etc. Yet Republican leadership continues to block action.

So who could possibly be against this? Aside from China, there are a few American interests making a ton of cash off of shipping jobs, factories, industries and our prosperity. Over at FDL, David Dayen writes in, Sherrod Brown Tries to Jump-Start Languishing Currency Manipulation Bill, Which Covers More Than Just China,

The constituency that really doesn’t want to see a currency manipulation bill pass Congress would be multinational corporations, who see value in siting their factories overseas and taking advantage of the low currency to deliver cheap imports.

OK, there is on -- giant multinationals. And there is another interest: Wall Street. The "Club For Growth" is a Wall Street front group, that has made the China currency bill a litmus test. Politico: Club for Growth warns GOP on China currency bill,

The influential Club for Growth is pressuring Republican presidential candidates and lawmakers to oppose bipartisan legislation cracking down on China’s currency policies.

The anti-tax, free-market group on Thursday called on GOP presidential contenders to take a stand against the bill, authored by Democratic Sens. Sherrod Brown (Ohio) and Chuck Schumer (N.Y.), that would slap tariffs on imports from China and other countries that artificially keep their currency low.

And, just this week the Club for ~~Wall Street~~ Growth asked both Presidential candidates to lay off China.

So on one side we have overwhelming support from Americans with both Republicans and Democrats polling up into the 90s. On the other side we have Wall Street, multinational corporations and, of course, China itself. And we have the Republican leadership and Presidential candidate siding with ... guess which side? But they are able to block action, and here we are.

Why The Latest Trade Complaint Against China Matters

Dave Johnson — Tue, 18 Sep 2012 12:57:00 -0400

The Obama administration has filed a trade complaint against China for violations involving "extensive" government subsidies for autos and auto parts.

From Reuters, at HuffPo: Barack Obama: China Auto Subsidies 'Directly Harm Working Men And Women',

"These are subsidies that directly harm working men and women on the assembly lines in Ohio and Michigan and across the Midwest," Obama told a campaign rally. "We are going to stop it. It is not right, it is against the rules, and we will not let it stand."

Why This Matters

The auto industry is targeted for takeover by China because it is seen as a(nother) key provider of high-paying jobs, export revenue and therefore national economic strength. The Seattle Times explains, in WHY IT MATTERS: China's auto parts industry.

The United States, China and other governments see the auto industry as an important source of higher-paid jobs and export revenue. The 2008 global crisis fueled complaints in the West that Chinese policies on a wide range of industries might be wiping out jobs abroad.

Chinese automakers exported only about 500,000 autos last year, mostly to the Middle East, Southeast Asia and other developing markets. But its producers of tires, aluminum wheels, radios and other components are making inroads in U.S., European and Japanese markets. They have yet to break into the top ranks of suppliers along with companies such as Delphi, Visteon or Europe's Michelin and Bosch. At the lower end of the market, Chinese suppliers are increasing their global share, putting pressure on smaller Western competitors.

China's strategies, from the same article,

Beijing has an array of strategies to support industries targeted for development, ranging from clean energy to mobile phones to autos. Companies can receive tax breaks and low-cost bank loans, energy and land.

The WTO allows research grants and some other aid, but critics say China violates rules that prohibit making exports a condition of support. They say Chinese policies have encouraged auto parts manufacturers to shift production to China, hurting employment abroad.

The key:

Employment in the U.S. auto parts sector shrank by roughly half between 2001 and 2010, while U.S. imports of auto parts from China have increased seven-fold, according to the Obama administration.

400,000 Jobs Lost, 1.6 Million More At Risk

In January three separate reports were released showing how China's illegal subsidies and other trade violations were causing job loss and damaging our supply chains. The Alliance for American Manufacturing (AAM) described the reports in New Reports Show China’s Illegal Trading Practices Endanger U.S. Auto Supply Chain,

More than 400,000 jobs in the U.S. auto supply chain have been lost since 2000. One major problem is China's persistent violations of World Trade Organization (WTO) rules, and another 1.6 million U.S. jobs are at risk unless China's illegal trading practices are curtailed, according to three separate reports released in January of 2012.

Taken together, these three reports show beyond a shadow of a doubt that China's blatant use of illegal government subsidies and a web of predatory trade practices on a massive scale are undercutting companies in the U.S. auto supply chain.

The three reports from January:

Growing Threats to the U.S. Auto-Parts Industry from Heavily Subsidized Chinese Tires and Parts, conducted by Robert E. Scott and Hilary Wething of the Economic Policy Institute (EPI), notes that a substantial portion of jobs in the U.S. auto industry are in the auto-parts sector, with direct and indirect auto parts jobs in virtually every state. The report concludes that “every one of these [1.6 million U.S.] auto-parts jobs is individually at-risk from this unfair trade competition.” Research by AAM has found that the auto parts sector comprises 75% of employment in the U.S. auto industry.
Putting the Pedal to the Metal: Subsidies to China’s Auto-Parts Industry from 2001 to 2011, conducted for EPI by Usha C.V. Haley, cites $27.5 billion in government subsidies to the Chinese auto-parts industry and notes that China’s central government has committed to disbursing an additional $10.9 billion in subsidies for industrial restructuring and technological development of the industry.
China’s Support Program for Automobiles and Auto Parts Under the 12th Five Year Plan, by Stewart and Stewart, a prominent law firm that has won cases challenging China’s unfair trading practices, offers evidence that the massive government subsidies being given to Chinese producers, which are in violation of China’s WTO commitments, will continue for years to come unless challenged by Congress and the President.

Report On Job Cost Of Trade Deficit With China

Dave Johnson — Fri, 24 Aug 2012 00:02:34 -0400

We as a country have been running enormous trade deficits that enormously benefit our 1% at the expense of the rest of us. As a country we get poorer while they get richer, so they want things to stay just the way they are. And that is where we are today -- an increasingly poorer country with an increasingly richer 1%.

Trade Deficit

As a country, a trade deficit is very bad for us. A trade deficit means we as a country buy more from other countries than we sell to other countries. This is a way that a country actually is like a household. A household has to bring in at least as much as it spends, or it eats its savings and then borrows. (A government's budget is not like a family's finances, but that is another story -- our real deficit problem is the trade deficit.)

But the problem is that the things that cause that trade deficit benefit a few wealthy, powerful and influential people here enormously. And those people of course want things to stay the way they are. If YOU get rich closing a factory, laying off the workers, moving the machines to China, bringing the same goods back here to sell in the same stores, YOU are doing just fine. But the people who worked in the factory, and the places where those people bought their clothes and food, and the town the factory was in are, and the wages of the rest of us in the country ... well look around you at any town that had a factory and you can see what happens.

But ... the person who closed the factory is rich, and THAT person can use that money to buy corporate/conservative think tanks that tell lies, and buy ads that tell lies, and elect politicians that keep things the way they are for the people who are making all the money off of the way things are. And that is where we are today -- an increasingly poorer country with an increasingly richer 1%.

New Report On Job Loss To China

So just how many jobs are lost to trade deficits? A new report, The China Toll, takes a look at the effect of our trade deficit with China since that country joined the World Trade Organization (WTO) ten years ago, and comes up with some very specific numbers. In summary:

"Growing U.S. trade deficit with China cost more than 2.7 million jobs between 2001 and 2011, with job losses in every state"

The Economic Policy Institute (EPI) released the report, The China toll, Thursday.

According to the report,

Between 2001 and 2011, the trade deficit with China eliminated or displaced more than half of all U.S. manufacturing jobs lost over that period. The growing trade deficit with China has cost jobs in every congressional district in all 50 states as well as in the District of Columbia and Puerto Rico.

The total losses include 662,100 jobs from 2008 to 2011 alone—even though imports from China and the rest of the world plunged in 2009 before recovering and surpassing the previous peak reached in 2008. The trade deficit in the computer and electronic parts industry grew the most, displacing more than 1 million jobs in high-tech industries. In fact, rapidly growing imports of computer and electronic parts, including computers, semiconductors and audio-video equipment, accounted for nearly 55 percent of the $217.5 billion increase in the U.S. trade deficit with China between 2001 and 2011.

Again: Half of our manufacturing job loss is lost to the trade deficit with China. ... The trade deficit in the computer and electronic parts industry grew the most, displacing more than 1 million jobs in high-tech industries.

Scott Paul, Executive Director of the Alliance for American Manufacturing (AAM), said of the report, “The EPI report offers convincing evidence that, unless China’s trade violations and currency manipulation are challenged forcefully, our growing trade deficit will continue to cripple the fledgling U.S. jobs recovery.”

“Exports to China may have increased since 2000, but imports have soared dramatically in that time,” explained Paul. “This report helps to quantify the millions of U.S. jobs lost due to this widening gulf.”

Map Of Job Loss By State

From AAM: The study found the hardest-hit congressional districts were in California, Texas, Oregon, and Massachusetts, and Minnesota. Some districts in North Carolina, Georgia, Colorado, and Alabama also were hit especially hard by job displacement in a variety of manufacturing industries, including computers and electronic parts, textiles and apparel, and furniture.

The Alliance for American Manufacturing has an interactive map showing job losses by state.

China vs. the USA: Olympic muscle and economic clout

Steven Capozzola — Fri, 10 Aug 2012 11:07:28 -0400

It's interesting to see the U.S. competing head-to-head with China for the top of the Olympic medal standings. As Andrew Weber points out in USA Today, for decades this close competition was instead the exclusive battle of the U.S. vs. the USSR.

But times have changed, and nothing confirms more palpably for the American people that China is on the rise as a world power than it's dominance in the 2012 Olympics.

Weber suggests that the U.S. will eventually gather the most medals at the London games, but until the past few days, China was leading in the overall standings.

China's emergance as a dominant Olympic power is a tangible extension of the nation's expanding economic power. With a massive industrial presence on the world stage, including a steel industry that dwarfs any other nation, and a trade surplus over the United States that hit $295 billion last year, there can be little doubt that the People's Republic is a force to be reckoned with.

This doesn't necessarily sit well with the American public. Beijing is home to a repressive regime that utilizes whatever means necessary to hold on to power. And China's leadership employs a host of predatory trade practices to ensure that it undercuts U.S. manufacturers.

When asked about China's persistent trade violations in a recent poll conducted by the Alliance for American Manufacturing (AAM), U.S. voters said they emphatically support tough action on Beijing’s cheating on currency and other trade obligations.

More significantly, a majority of voters (56 percent) no longer see the U.S. as having the world’s strongest economy. A plurality of those surveyed (31%) thought China now holds the top economic spot.

Seeing China at the top of the Olympic medal count can only confirm for many that the People's Republic is the world's new superpower. But America's democratic system is worth fighting for, and 88 percent of voters believe that it’s possible for America to have the strongest economy. In fact, 92 percent believe that it is important for the U.S. to regain that position.

The U.S. currently leads in the Olympic medal standings. But it's a tight race, and one that looks likely to prefigure a lengthy battle on the world stage between the U.S. and China.

Romney, Republicans Again Side With China Over US Companies

Dave Johnson — Thu, 02 Aug 2012 12:35:36 -0400

China and the US are in a fight to win a share of the millions of jobs and trillions of dollars that will come from the new alternative-energy industries that are gearing up to replace oil and coal. But Mitt Romney has told Republicans to remove an extension of wind-energy tax credits from an "extenders bill." This is about oil and coal company domination of our economy and the Republican Party -- even as it gives China an economic advantage over us. Romney also is not asking the House to vote on the bill that fights Chinese currency manipulation. What's going on?

Competition For Alternative-Energy Jobs

We are in a worldwide competition to build the post-oil economy. This is a competition for millions of jobs and trillions of dollars. Every country wants a share of the design and manufacturing of wind turbines, solar panels, geothermal systems, biofuels, electric cars, high-speed rail, urban and suburban light rail, advanced batteries, smart-grid power transmission systems, and all of the rest. And there is also the fight for the construction, installation and maintenance contracts for all of these systems.

China is fighting particularly hard for a dominant share of these new industries. The US is falling behind. Oil- and Wall Street-backed Republicans again and again are siding with China.

The news reports tell the wind-tax-credit story:

The Hill: Romney campaign: Let wind energy credit die this year

Mitt Romney’s campaign said Monday that he wants longstanding tax credits that help finance wind energy projects to expire at year’s end, providing a stark political contrast with President Obama, who is pushing Congress to renew the incentive.

... The wind industry calls the production tax credit vital to financing new power projects, and says uncertainty about its future is already spurring layoffs along the wind energy supply chain and that tens of thousands of jobs are at risk.

President Obama and top administration officials have repeatedly called for extension of the credit in recent months.

The number of new wind power installations have fallen off sharply in the past when the credit has been allowed to lapse, which last happened in 2004.

NY Times: Wind Credit on the Block

A longstanding tax credit for wind power that has broad bipartisan support was caught Wednesday in presidential politics when Senate Republicans removed it from a usually routine package of business tax breaks to show their loyalty to their presumptive presidential nominee, Mitt Romney.

Mr. Romney on Monday came out in favor of letting the wind production tax credit lapse at the end of the year, just as Senate Finance Committee members were nearing completion of a hard-fought package of business tax breaks they hope to pass out of the committee on Thursday. Those negotiations were largely about paring back the package, which routinely passes without much scrutiny.

... But for now, according to committee sources, Republicans who had favored the credit believed that they needed to unite against it for Mr. Romney’s sake.

The Hill: Obama official: Ending wind credit could have 'devastating effect',

Letting the wind production tax credit (PTC) expire at the end of this year “could have a devastating effect” on the wind energy industry, Federal Energy Regulatory Commission Chairman Jon Wellinghoff said Tuesday.

Wind, or any other energy industry, needs “some level of certainty” about incentives they bake into business plans, Wellinghoff said in response to a question from The Hill at the Platts Energy Podium in Washington, D.C.

He advocated that, if the wind credit were to end, it should happen in a phased manner rather than with an “arbitrary and immediate cutoff.”

Examiner: Energy officials say renewal of wind energy tax credit key to American jobs,

As Asian countries, especially energy-hungry China, ramp up their use of renewable energy sources, American wind energy equipment and parts jobs will flow to countries not frozen in place by warring political parties, as is the case in the United States, according to Former Secretary of Energy Federico Pena, Former Iowa Governor Chet Culver, Pennsylvania wind developer Brent Aldefer and Mark Shanahan, former Director of the Ohio Air Quality Development Authority, each of whom drew sharp contrasts today between President Obama and Mitt Romney on wind energy.

The quartet of energy experts used GOP presidential hopeful Mitt Romney’s “Plan for Jobs and Economic Growth” as a point of reference as they laid out their case on differences between what Mr. Romney would do on alternative energy like wind and solar—end them but continue tax subsides for very profitable oil and gas companies—and what President Obama would do—continue the tax credit if Congress approves it before it expires at the end of the year.

Under "Research and Development" in Mitt Romney's "Pro-Jobs, Pro-Market, Pro-American" economic plan, he makes it clear that he thinks wind and solar are the wrong places to make investments going forward.

Republicans Again Siding With China

This latest wind-energy battle is only the latest example of China-backing.

The Senate has passed a bill that cracks down on Chinese currency manipulation. But House Republicans are blocking a vote on this bill -- even though more than 60 of them are co-sponsors. Mitt Romney says he supports cracking down on China, but will not ask House Republicans to bring this bill up for a vote. A word from his campaign blocks wind energy tax credit renewal -- but no word from his campaign on this!

Chinese Money Influencing Election?

The Supreme Court has allowed billionaires and corporations -- even non-US-owned corporations -- to pump unlimited amounts of money into influencing our elections. But various loopholes prevent us from even learning which billionaires and corporations are behind many of the ads. There is one billionaire, however, we do know about.

Casino billionaire Sheldon Adelson, has already given $10 million to Mitt Romney's campaign and promises a "limitless" amount -- $100 million or more. Adelson has $25 billion, largely thanks to China granting him an exclusive license to operate casinos in their territory.

This exclusive Chinese-granted casino license is worth billions, and Adelson has in the past used his influence with Republicans in Congress to help China. Adelson influenced Republicans to help China get the Beijing Olympics and then received the license to build casinos in Chinese territory. From the New Yorker, The Brass Ring: A multibillionaire’s relentless quest for global influence,

In July, 2001, Adelson met with a Vice-Premier of China, Qian Qichen ... [and] met with the mayor of Beijing, who asked Adelson for help with a matter pending in the U.S. House of Representatives, which he believed was threatening China’s chance to host the Olympics.

Adelson ... immediately made calls on his cell phone to Republican friends in Congress—including Tom DeLay, then the majority whip—who had received generous support from Adelson. DeLay told him that there was indeed a resolution pending ...opposing China’s Olympic bid, saying, “China’s abominable human rights record violates the spirit of the games and should disqualify Beijing from consideration.” ... Three days later, the International Olympics Committee voted in China’s favor. [Adelson received the casino license soon after, in early 2002 - dj]

[...] In May, 2004, the first gamblers entered the Sands Macao. Its construction costs were two hundred and sixty-five million dollars, and Adelson made back his initial investment in a year. In December, 2004, Adelson took Las Vegas Sands public (according to Forbes, he owns sixty-nine per cent of the stock) and became a multibillionaire, overnight.

McCain: Adelson funding Romney Super PAC with 'foreign money',

Senator and Romney presidential campaign surrogate John McCain (R-AZ) said Thursday that casino magnate Sheldon Adelson is indirectly injecting millions of dollars in Chinese "foreign money" into Mitt Romney's presidential election effort.

Adelson used his influence with the Republicans in Congress to help China get the Olympics, and then got a casino license worth billions to him. What else has he helped or will he help China get? Is this influence -- not just oil-company domination -- what is behind Romney and the Republican party continually siding with China over American companies and interests?

Action

The Blue Green Alliance has a number of things you can do to help save American wind-energy jobs. )lease visit their SAVE AMERICAN JOBS page:

Right now, Congress is sitting on critical tax incentives for renewable energy that would create thousands of jobs and boost American competitiveness in the global economy. Clean energy tax incentives like the Production Tax Credit (PTC) for wind, the 1603 Treasury grant program, and the Advanced Energy Project Credit (48C) have created and saved thousands of jobs, and extending these incentives will create many more.

However, failure to act on these important tax credits threatens the very jobs we need right now.

Click through, and click here to see their full-page ad about renewing the Production Tax Credit.

Conservatives Demand Surrender To China

Will Conservatives Support American Companies ... Or Chinese?

Romney Etch-A-Sketching On China Currency

Romney On China: Talks The Talk, Will He Walk The Walk?

China's VP Visit Becomes Campaign Issue - Will Romney Ask GOP To Allow China Bill Vote?

German Solar Companies Also Bring Trade Complaint Against China

Dave Johnson — Thu, 26 Jul 2012 13:58:22 -0400

American solar companies are not alone in their battle with Chinese trade cheating. The Obama administration recently imposed tariffs because Chinese "dumping" was hurting American companies (like Solyndra). German solar companies are also bringing trade complaints against China for pricing their products below cost to try to put companies in other countries out of business.

Oil-backed Republicans are fighting our solar industry tooth-and-nail, complaining that the Obama administration attempted to foster an alternative-energy industry that could bring us a share of millions of new jobs and trillions of dollars. They even trumped up a phony scandal about Solyndra

Businessweek: Solarworld-Led Group Files China Anti-Dumping Case in Europe,

Solarworld AG (SWV), Germany’s largest solar-panel maker, led a group of manufacturers in requesting the European Commission investigate whether Chinese competitors dumped products at below-market rates on regional markets.

The EU ProSun group filed the anti-dumping complaint in Brussels after a similar request in the U.S. resulted in duties on solar imports from China. The group has 25 members including companies from Italy, Spain and Germany’s Sovello GmbH, EU ProSun President Milan Nitzschke said today.

“A majority of the European solar industry backs the complaint,” Nitzschke said by e-mail. “Chinese companies are offering their products below manufacturing costs despite their own massive losses.”

In May I wrote about the Obama administration imposing tariffs on Chinese solar panels: Will Conservatives Support American Companies ... Or Chinese?

In March I laid out the case: Tariffs On Chinese Solar Might Help Prevent The Next Solyndra