April 22, 2005

Trade Nominee Promises Tougher Line with China

By: Elizabeth Becker

WASHINGTON, April 21 - Representative Rob Portman, President Bush's nominee to be the next United States trade representative, answered mounting criticism of the administration's trade policies on Thursday by promising that he would take a stricter approach to China if he were confirmed.

At his confirmation hearing before the Senate Finance Committee, Mr. Portman, a Republican from Ohio, fielded repeated questions about China's refusal to follow international trade laws, especially those covering intellectual property rights. "We need a tougher approach," he said.

"We need to hold their feet to the fire; we need to enforce United States trade laws," Mr. Portman said.

Both Republican and Democratic lawmakers said China was responsible in large part for the United States' soaring trade deficit, which reached a record of $617 billion in 2004, and for the destruction of jobs and livelihoods tied to industries decimated by that trade imbalance.

The hearing was unusual for the sharp contrast between the deep and broad-based criticism of the administration's trade policy and the warm, unanimous praise of Mr. Portman, a Congressional Republican who works well with Democrats and is also a close friend of the president.

A skilled negotiator, Mr. Portman has routinely won support from Democrats for legislation. Rep. Benjamin L. Cardin of Maryland, the ranking Democrat on the House Ways and Means trade subcommittee, sat behind Mr. Portman for part of the session as a show of support.

If it were not for a near revolt in Congress over China and the trade deficit, Mr. Portman would win confirmation easily. He is expected to secure the approval of the committee when it votes on his nomination on Tuesday.

However, Sen. Evan Bayh, Democrat of Indiana, has said he will place a hold on Mr. Portman's nomination when it comes before the full Senate for a vote unless the administration agrees to allow a vote on a bill that would make it easier to penalize China for subsidizing exports.

As much as lawmakers approve of Mr. Portman, they want to send a message to the administration that trade policy needs to change.

Sen. Olympia J. Snowe, Republican of Maine, typified that predicament.

Ms. Snow told Mr. Portman that she welcomed his appointment, but she went on to criticize the administration because, she said, it has failed to enforce trade laws and has allowed China to "plunder the United States' creativity" by counterfeiting copyrighted material, from software to movies. Such thievery, she said, "continues unabated."

"At what point do we take action?" Ms. Snowe asked Mr. Portman.

A former international trade lawyer, Mr. Portman was at pains to convince Ms. Snowe and the other senators that he agreed with their assessment that China must end its trade abuses and adhere to trade laws.

He even agreed with Sen. Charles E. Schumer, Democrat of New York, that China should revalue its currency, a move that many analysts say would help the United States' trade balance by making Chinese exports more expensive. Mr. Schumer is a co-sponsor with Sen. Lindsey O. Graham, Republican of South Carolina, of a bill that would impose tariffs of up to 27.5 percent on all Chinese imports if China fails to let its currency float more freely.

At the same time, Mr. Portman resisted offering the senators specifics on how he would alter policy to ensure that China and other nations respected trade laws. He said he would undertake a top-to-bottom review of trade policy with China before devising a new approach.

Critics contend that despite several years of promises from the Bush administration that it would use diplomacy to bring China into line with trade laws, the administration has failed to put an end to the piracy and counterfeiting that the United States Chamber of Commerce says cost American industry more than $200 billion a year.

The United States registered a $162 billion deficit with China last year, a record with a single country.

"There is an undertone to this hearing of great frustration," said Sen. Max Baucus of Montana, the ranking Democrat on the committee. "As a country we have to get our act together and do a better job on trade - that is our message to the administration."

 

 

 



 

 

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