Obama threatens to veto trade currency provisions
Washington — The Obama administration threatened Tuesday to veto a proposed change in major trade legislation to require U.S. negotiators to target currency manipulation more directly in trade talks, and Senate Republican leader Mitch McConnell said the GOP was prepared to vote down the amendment.
“We’ll be working hard to keep any amendment off the bill that could tank” it, McConnell said of the proposal, backed by Sens. Rob Portman, R-Ohio, Debbie Stabenow, D-Lansing, and others.
Stabenow, in remarks on the Senate floor, said that when governments intervene in the marketplace to manipulate the value of their currency, it “is cheating, plain and simple. It means that foreign products are cheaper here and U.S. products are more expensive there.”
Meanwhile, the Obama administration and Senate Republicans worked in unusual harmony Tuesday to advance the trade bill opposed by many rank-and-file Democrats, an expanding struggle already leaving a mark on the 2016 campaigns for the White House and control of Congress.
McConnell, R-Ky., is one of Obama’s fiercest critics in Congress, and his comment underscored the unusual political lines created by a bill to let the president negotiate global trade deals that Congress could approve or reject, but not change. The White House and pro-business Republicans support the measure, while union-backed Democrats oppose it.
Portman, who once served as President George W. Bush’s special trade representative, is also a likely supporter of the bill. At the same time, he faces a competitive re-election campaign in his Midwestern political swing state next year, and has played a central role in efforts to make the legislation require American negotiators to give higher importance to combatting currency manipulation by other countries.
The administration’s veto threat came in the form of a letter from Treasury Secretary Jacob Lew to the bill’s leading supporters. He warned that approving the amendment backed by Portman, Stabenow and others could cause trade partners to walk away from talks on a 12-nation deal among countries that border the Pacific Ocean “and cause us to lose ground on holding countries accountable on currency.”
He also warned it could “give our trading partners the power to challenge legitimate U.S. monetary policies needed to ensure strong employment and a healthy robust economy, an outcome we would find unacceptable.”
American Automotive Policy Council President Governor Matt Blunt issued a statement supporting the proposed currency measure.
“The Portman-Stabenow amendment is vital to American jobs, American manufacturing and American exports and that’s why U.S. automakers are urging Senate passage,” Blunt stated. “It is important to America’s economic growth that enforceable rules prohibiting currency manipulation are part of all future trade agreements.”