Alexi Calls for Fair Trade

By Kevin Robinson in News on Dec 14, 2009 3:20PM

Illinois State Treasurer Alexi Giannoulias, the Chicago Democrat running for Illinois's junior senate seat, announced on Sunday as part of his jobs and economic platform his support for "reining in America's $200 billion trade deficit with China" by changing our trade policies to require China to "abide by fair labor, environmental, safety and health standards" that American firms must follow. He outlined three steps he would support in the Senate that would lead to that goal, requiring the U.S. to change its trade policies to discourage China from subsidizing weak state industries, closing tax loopholes that allow American firms to defer paying taxes on income earned abroad and stepping up copyright enforcement to crack down on Chinese counterfeiters that pirate movies, music and software. He also said that he would push for Congress to impose tariffs on Chinese imports if China doesn't end the practice of pegging the yuan to the dollar, which artificially keeps the Chinese currency devalued against the dollar, making U.S. exports substantially more expensive than their Chinese counterparts. "We don't want a trade war with China. But the Chinese government must end unfair trade practices and learn to compete on a level playing field," Giannoulias said. "China plays by its own rules, and only when their abuses are reined in will there be fair trade."

As part of the announcement, Giannoulias pledged that he would co-sponsor the TRADE Act bill in the Senate. That bill would require the Government Accountability Office to review all existing trade agreements for their impact on jobs and the environment, and then requires the president to submit renegotiation plans to Congress to remedy the gaps the GAO identifies. The review required in the TRADE Act includes NAFTA and the WTO. The Illinois GOP went on the offensive almost as soon as Giannoulias's announcement. “As Illinois struggles with 11 percent unemployment, Alexi Giannoulias should not be risking a trade war with our state’s two largest export markets,” Illinois Republican Party Chairman Pat Brady said in a press release. “More than 100,000 Illinois jobs and 8,000 Illinois employers depend on Canada and Mexico for roughly one-third of our state’s exports. Alexi’s blatant pandering to the left-wing might help him win a primary, but it fundamentally calls into question his judgment when it comes to job creation and economic recovery.” For his part, Giannoulias says that talks around NAFTA are a "delicate balancing act," and must be handled so as not to "interfere with flow of oil and natural gas from Canada and Mexico," keeping prices down in the U.S. and maintaining jobs related to North American trade.

While the TRADE Act has gained some traction in the House, it seems stalled in the Senate where, like the current Health Care debate, Democrats might splinter, preventing the party from getting the necessary support to pass the bill.