Lawmakers: Tackle currency manipulation or risk trade agenda

A bipartisan group of lawmakers is ramping up pressure on the Obama administration to address currency manipulation or risk the completion of its trade agenda.

Nine House and Senate members introduced legislation on Tuesday that would punish countries that alter their exchange rates to gain a global trading advantage, hurting U.S. workers and damaging competitiveness.

{mosads}Rep. Sandy Levin (D-Mich.), ranking member on the House Ways and Means Committee, told reporters that “the importance of raising this in the legislation and within TPP [Trans-Pacific Partnership] is to put currency manipulation into the mix of trade negotiations and trade discussions.”

Levin said he wants “to get the point across that this is an issue that Congress cares about.”

He said currency is one of a dozen outstanding major issues that “we have to get right and right now it’s not right.”

Besides Levin, the House bill was co-sponsored by Reps. Tim Murphy (R-Pa.), Tim Ryan (D-Ohio) and Mo Brooks (R-Ala.).

Five senators — Democrats Sherrod Brown (Ohio), Debbie Stabenow (Mich.) and Charles Schumer (N.Y.) and Republicans Jeff Sessions (Ala.) and Lindsey Graham (S.C.) — delivered a similar message, saying they will withhold their support for trade promotion authority (TPA) and any trade agreements that don’t tackle the currency issue.

Graham said there appears to be “growing support” among Republicans and Democrats for the U.S. to put up a fight against countries that deliberately manipulate their currency. 

“I believe there is bipartisan opposition to any trade agreement that doesn’t deal with currency,” said Graham, a potential 2016 presidential candidate.

Stabenow argued that she and other lawmakers have been in discussions with the Obama administration at every level, so the latest push “isn’t a surprise.”

Brown said without a focus on currency, it would be “strike three” for the trade agenda.

In another Tuesday briefing, Rep. Dan Kildee (D-Mich.) said any trade deal “like TPP without strong enforceable currency manipulation provisions is bad for American workers, bad for businesses, and bad trade policy.”

President Obama has pushed back against the efforts, telling House Democrats at their recent retreat that adding currency rules into the TPP would be too complicated and could sink the talks, which are nearing completion.

While Levin is making the push to add currency provisions to the trade deals, Schumer said the issue doesn’t have to be a part of TPA or TPP but it should at least run in tandem.

Sen. Rob Portman (R-Ohio), a former U.S. trade representative, told reporters that he viewed trade promotion authority, TPP and the currency push as three separate trade issues.

House Ways and Means Committee Chairman Paul Ryan (R-Wis.) said he wants to move a clean TPA bill.

The legislation introduced Tuesday would impose import duties to offset the effects of undervaluing currency when a country is found guilty of manipulation.

Similar bills passed the House in 2010 and the Senate in 2011.

While the fate of the bills is uncertain, lawmakers argued that their aim is to elevate the discussion and put a spotlight on an issue that they say has hurt U.S. workers and pushed up the trade deficit for years.

In the last Congress, a majority of lawmakers on both sides of the Capitol called on the White House to push for the inclusion of currency provisions into trade agreements under negotiation, including the TPP.

Fred Bergsten, a former head of the Peterson Institute who has pressed for changes in currency policy, said the bill would cover only a small share of imports. However, he said, it would “send a signal that Congress cares about the currency issue.”

“Currency manipulation is the No. 1 protectionist issue of the 21st century,” he said.

Meanwhile, Senate Finance Committee Chairman Orrin Hatch (R-Utah) told reporters on Tuesday that “we’ve come a long way” on the TPA legislation. But he wouldn’t provide any specifics as to when a bill will be ready, although it could be shortly after the Presidents’ Day recess.