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Debate on China is heated on Hill

The Baltimore Sun

WASHINGTON -- Weak enforcement of trade laws is allowing surging Chinese imports to create an "unprecedented crisis" for U.S. manufacturers, an attorney for U.S. corporations told the Senate Finance Committee yesterday.

But a retailers' representative shot back, saying U.S. consumers would be hurt by an unnecessary crackdown on trade.

The clashing views underscored the dilemma facing Congress: If it slows the rush of imports to help domestic producers, it risks riling retailers and consumers who benefit from the lower prices of goods imported from China.

The manufacturers' attorney insisted the top priority must be preserving U.S. jobs.

"We must get serious about China," said Robert E. Lighthizer, international trade partner for Skadden, Arps, Slate, Meagher & Flom LLP. U.S. trade officials must not allow foreign competitors to use "rules of the game that are stacked against our producers and workers," he said.

But Erik Autor, vice president of the National Retail Federation, said the global trading system is working well to benefit U.S. consumers, as well as merchants and their millions of workers.

"U.S. trade-remedies laws are already vigorously, even zealously enforced," Autor said, and calls for tougher enforcement amount to "histrionics and disinformation."

"Waving the banner of 'fair trade,' some domestic industries have taken advantage of popular anxiety over trade and globalization to push for protectionist measures and legislation to limit foreign competition and pad their own profit margins at the expense of U.S. consumers," Autor said.

The committee's chairman, Sen. Max Baucus, a Montana Democrat, said studies suggest that if China were fully complying with its trade commitments, the U.S. economy would get an annual $84 billion boost by 2010. But the Bush White House is not doing enough to enforce compliance with agreed-upon rules, he said.

"The administration spends far more time negotiating new deals than enforcing those already in place," Baucus said.

Sen. Charles E. Grassley of Iowa, the committee's senior Republican, disagreed, insisting "the claim that they aren't pursuing good cases is unfounded."

The committee held the hearing to consider ways to boost trade-law enforcement, such as passing additional laws or adding more enforcement staff.

On Monday, China's customs bureau said on its Web site that the country's global trade surplus shot up an estimated 73 percent in May from a year earlier.

A bipartisan group of U.S. senators plans to unveil legislation today designed to pressure China to revalue its currency. Economists say China holds down the value of its currency so that the country's exports are cheaper.

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