Labor, firms target China currency status

Small manufacturers and labor groups are courting House members in their home districts to build support for legislation that would make currency manipulation by China and other countries a subsidy.

The goal is to build momentum for a vote in the House on H.R. 782, the Fair Currency Act introduced by Reps. Tim Ryan (D-Ohio) and Duncan Hunter (R-Calif.). A similar measure introduced last year won 178 cosponsors, but never received a House floor vote.

The manufacturers and labor groups also want to deliver enough sponsors to similar Senate legislation that would offset a rival China trade bill from Senate Finance Committee Chairman Max Baucus (D-Mont.), ranking member Chuck Grassley (R-Iowa) and Sens. Charles Schumer (D-N.Y.) and Lindsey Graham (R-S.C.).

 “To get through Grassley-Baucus, we’re going to have to have a lot of support,” a member of the China Currency Coalition’s executive committee, Charles Blume, said. If Baucus and Grassley, as expected, take a different approach to addressing currency manipulation, Blume said it will come down to a numbers game.

The currency group already has some numbers on its side, as the sponsors of the Senate bill include three Finance Committee members: Sens. Jim Bunning (R-Ky.), Debbie Stabenow (D-Mich.) and Olympia Snowe (R-Maine).

To win more support, members of the currency coalition are emphasizing a go-local strategy that includes scheduling meetings between members and local business leaders supporting the legislation in their districts. “For me, the thing that works best is when they go home,” Blume said. “That’s the best lobbying of all.”

For example, the president of Paul Revere Copper Products, Brian O’Shaughnessy, met with House Financial Services Committee Chairman Barney Frank (D-Mass.) after announcing a plant in Frank’s district would be closing, partly because of increased competition from China.

O’Shaughnessy said Frank indicated a vote on the Hunter-Ryan measure was possible, although he also indicated it was less likely that Congress would take up the issue of how differences between U.S. and foreign taxes penalize U.S. exporters, which O’Shaughnessy said is to blame for the closure of his factory in New Bedford, Mass.

Frank’s committee is discussing a possible joint hearing with the House Ways and Means and Energy and Commerce committees on currency legislation, a House aide said. The hearing would be at the subcommittee level, and business sources said it could take place in late April.

Paul Revere’s plant in New Rome, N.Y., and the entire brass and copper sheet and coil industry are threatened by competition from China, according to O’Shaughnessy. He said he would be meeting in early April with freshman Rep. Michael Arcuri (D-N.Y.), whose district includes New Rome. Arcuri is not one of the Hunter-Ryan bill’s 58 cosponsors.

John Hoskins of the Curtis Screw Company in Buffalo, N.Y., lobbied Rep. Tom Reynolds (R-N.Y.) on the currency bill last year. Reynolds was serving as chairman of the National Republican Congressional Committee at the time, where he was tasked with winning political contributions from companies opposed to the China currency legislation.

Reynolds called Hoskins personally to say he had decided to support the Hunter-Ryan bill, Hoskins said. This year, an aide to Reynolds said the congressman has not decided whether this year’s bill is the best option to tackle the issue of currency manipulation and is still studying the issue. Hoskins said he is again lobbying Reynolds to support this year’s Hunter-Ryan bill.

Groups on the other side of the currency issue include the U.S. Chamber of Commerce and the U.S.-China Business Council, which includes Archer Daniels Midland, Boeing, Johnson and Johnson and Wal-Mart among its members. It also includes smaller manufacturers, such as MTS Systems in Minnesota.

The council also has been busy meeting with House and Senate offices about the currency legislation, which it argues would be counter-productive and violate World Trade Organization rules. If the Hunter-Ryan legislation became law, it would be challenged by China or other WTO members with companies invested in China, and the U.S. would lose, according to Erin Ennis, the council’s vice president. That could lead to retaliation against U.S. exports.

She said her organization’s lobbying efforts so far are focused on members of the House Ways and Means Committee and a separate bill that would change U.S. trade laws to allow countervailing duties to be applied on imports from countries with state-run economies such as China, Ennis said. Ways and Means is expected to address that issue in a matter of weeks.

Separately, another business lobbyist opposed to the Hunter-Ryan bill said opponents face a difficult political atmosphere. “People are out for blood on China,” the lobbyist said.