Let's increase our trade deficit?
I don't understand it. So now they're unhappy about cheap Chinese imports? Do they have some other country in mind that can fill Walmart with cheap goodies, or maybe they imagine that the 3 million jobs will come back to America if the yuan goes up another 20%? We'll simply pay more for the same goods, which will increase, rather than decrease, the deficit.
Paulson says the US following policy of robust engagement with China on trade issues
WASHINGTON (AP) -- Treasury Secretary Henry Paulson says the administration intends to keep pursuing a policy of "robust engagement" with China that will include filing unfair trade cases as needed and pressuring the Chinese to move more quickly to revalue their currency.
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"It is clear that our strategy for robust engagement with China -- intensive dialogue but with resort to WTO dispute settlement and WTO-sanctioned trade remedies if needed -- is more productive than protectionist policies or legislation," Paulson said in his prepared remarks.
The Chinese have complained that the administration has harmed the chances for making progress in the high-level talks by resorting to filing trade cases against China before the World Trade Organization.
However, the administration has dismissed those complaints, arguing that it is pursuing a two-pronged approach that will seek to get China to address contentious trade issues during the twice-a-year meetings but if those efforts fail, it will not hesitate to take cases to the WTO.
The administration is facing rising unhappiness in this country over the soaring trade deficit with China which critics blame in part for the loss of more than 3 million U.S. manufacturing jobs since 2001.
High-level delegations from both countries will meet on June 17-18 in Annapolis, Md., for the fourth round of discussions launched in December 2006 known as the Strategic Economic Dialogue.
American manufacturers contend that the biggest trade issue remains China's currency, which they contend is significantly undervalued, making Chinese goods cheaper for U.S. consumers and American products more expensive in China.
Paulson acknowledged that the Chinese have allowed their currency to rise in value by about 20 percent against the dollar since July 2005 but he said more needed to be done. In addition to helping deal with the trade gap, Paulson said Chinese efforts to reform their currency policies would improve that country's ability to deal with its rising inflation problem.