In Senate vote, a win for the middle class and a rebuke to China

[n2doc]

By Harold Meyerson, Published: September 29

The news that our trade with China has been bad for the American middle class has finally reached the U.S. Senate. On Monday, the Senate will take up legislation that would impose tariffs on Chinese goods so long as China depresses the value of its currency. Despite the partisan polarization that grinds lawmaking to a halt these days, the bill’s support is thoroughly bipartisan, with sponsors ranging from such conservative Republicans as South Carolina’s Lindsey Graham to liberal Ohio Democrat Sherrod Brown. The legislation is expected to clear the Senate’s 60-vote hurdle for a floor vote and move on to the House.

For students of America’s deranged romance with free trade, the fact that the Senate is willing to take on China is little short of amazing. Since the 1980s, the House has been the legislative body where epic battles have been waged over the free-trade agreements that have decimated American manufacturing. The impact of factory closures on congressional districts is generally too big for representatives to ignore. Local manufacturers and bankers, no less than local union members, complain to their House members; when the town’s biggest employer leaves, grief knows no party. Senators, on the other hand, move in a larger world, one where Wall Street contributors and Washington pundits assure them that free trade is invariably good. So while the House has been home to furious fights over NAFTA, CAFTA and extending permanent normalized trade relations to China, the Senate has long passed such measures with much less fuss and sublime indifference to the consequences.

But the consequences can no longer be denied. Between 2001 and 2010, the U.S. trade deficit with China cost Americans 2.8 million jobs, according to a report by economist Robert Scott, issued last week by the liberal Economic Policy Institute. Most of those jobs — 1.9 million — were in manufacturing, and of those, almost half were in computers and electronics.

This wasn’t simply the consequence of China’s cheaper labor or more generous corporate subsidies. As China’s productivity soared during the past decade, the value of its currency should have risen correspondingly. Instead, China purchased dollars, which had the effect of depressing the yuan and making Chinese exports about 28 percent cheaper than they would be if the yuan had been allowed to appreciate, William Cline and John Williamson found in a study for the centrist Peterson Institute for International Economics.

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http://www.washingtonpost.com/opinions/in-senate-vote-a-win-for-the-middle-class-and-a-rebuke-to-china/2011/09/29/gIQA6vFJ8K_story.html

[denverbill]

1. Wow. I'm stunned.

But I guess we have to wait and see what actually happens. The Chamber of Commerce is going to throw wads of cash against this as will the Koch's and the DLC.

[OhioChick]

2. You and me both...

:wow:

[Enrique]

3. kick

for an important and overlooked story.

[GeorgeGist]

4. Hardly inscrutable ...

if one does that math before they get in trouble.