Peter Morici's recent article provides an excellent synopsis of our relationship with China and its practice of mercantilism ("China currency bill: America fights back," Oct. 11). He lists GE and Caterpillar as U.S. companies salivating at the prospect of gaining access to China's massive developing market and willing to agree to Chinese demands for technology transfers through forced joint-venture arrangements with local companies.

Congress' threats of tariffs and attacks on the Chinese yuan are a rerun of the Smoot-Hawley Act of 1930, which was a major cause of the Great Depression. Passing such measures today would lead to global economic chaos.

The demand for revising exchange rates is not only politically naïve but economically ill-conceived. Doubling the value of the yuan would in effect double China's average labor cost of $2 an hour, but would do absolutely nothing to make U.S. consumer goods produced with $20 an hour labor more competitive. Meanwhile, it would cut China's raw materials costs in half.

Warren Buffett targeted unequal trade agreements and proposed a unique method to eliminate the growing U.S. foreign exchange deficit. The Buffett proposal in no way inhibits trade — there are no countries singled out for retribution, no quotas, tariffs or limits on investment in U.S. manufacturing companies, and no demands for local content on goods sold in the U.S.

Sen.Russell Feingold converted Mr. Buffett's proposal into a bill called the Balanced Trade Restoration Act, which requires cumulative global reciprocity in exchange for access to our markets. But it failed to pass.

Considering that the Chinese are now our bankers and produce a significant amount of our consumer and industrial goods, the current tariff and exchange rate legislation should be replaced by the Buffett-Feingold approach.

Charles Campbell, Woodstock

The writer is a former senior vice president of the Gulf Oil Corporation.