China Currency Bill Moves Forward in the Senate

The Senate overcame a procedural hurdle on the China currency bill tonight, which could set the stage for final passage later this week.

By a bipartisan vote of 79-19, the motion to proceed was agreed to, called by Sen. Manchin, D-W.Va. The debate will continue throughout the week, aiming for final passage later in the week.

“I hope the Senate vote will wake up the administration,” Sen. Lindsey Graham, R-S.C., said tonight after the vote. “I hope the Senate vote today will wake up the House to get off the sidelines and get in the fight.”

The bill, which attempts to counter the economic harm to U.S .manufacturers caused by China undervaluing its currency, would impose tariffs on Chinese imports and make it easier to investigate allegations of currency manipulation.

Proponents of the bill say that this will be a job creator in the United States by leveling the playing field. Opponents say it would benefit the people of China more than America and could set off a trade war at a time when the country is economically ill-prepared for one.

“This legislation that we’re going to move to will even the playing field and help American goods compete in a global market and help keep American jobs here at home,” Senate Majority Leader Harry Reid, D-Nev., said on the Senate floor this afternoon. “I hope this legislation will motivate China to stop devaluing the yuan [currency] on its own. I also know it will send a strong pledge to the Chinese that Americans will no longer ignore their blatant, unfair trade practices.”

Reid wants to wrap up work on the bill “quickly” this week, he said. 

But some aren’t convinced this legislation is what the Senate needs to focus on, including Sen. John McCain, R-Ariz., who today said he’s amazed that the bill is taking precedent over other important issues that need to be acted on.

 ”When I go home and find people without jobs and with half of the homes underwater, when I find people out of work, when I pass by the shuttered and closed strip malls throughout my state of Arizona, obviously, and then hold a town hall meeting, obviously, my constituents are angry and frustrated,” McCain said today.  ”And I don’t know of a single town hall meeting I’ve  had, not a single one, where someone stood up and said, ‘Pass he china currency bill and then our lives will be improved.’”

Sen. Bob Corker, R-Tenn., said passing a bill to call China, in essence,  a currency manipulator is “playing with fire.”

“I believe what will happen is going to be a trade war,” Corker said on the Senate floor this afternoon. ”When the global economy is slowing due to … the financial crisis that is occurring right now in Europe, I think the response that we want to put forth is not to create a trade war with China.”

“We’re already in a trade war with China, and we’re losing,” Sen. Chuck Schumer, D-N.Y.,  said on the Senate floor today. “On issue after issue after issue, China is mercantilist, plain and simple. They use the rules of free trade when it benefits them and spurn the rules of free trade when it benefits them.”