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President Barack Obama and President Hu Jintao of China Jan. 10, 2011, at meeting with U.S. business leaders.
President Barack Obama and President Hu Jintao of China Jan. 10, 2011, at meeting with U.S. business leaders.
In campaign appearances Monday in Cincinnati and Columbus, President Obama will make known the administration's demand to the World Trade Organization that China stop subsidizing its auto parts manufacturers. The practice, the administration says, undercuts U.S. auto parts sales in foreign markets by reducing the cost of Chinese-made parts and spurs outsourcing by the American-based industry. The administration will also seek a speeded-up review of another WTO case in which the U.S. says that China levies unfair tariffs against U.S.-made autos.

Ohio is a battleground state in the upcoming election. The auto industry employs more than 54,000 autoworkers there directly. When steelworkers and others are included, more than 850,000 Ohio workers depend on the auto industry for their jobs, 12.4 percent of the state's entire workforce. Nationwide, there are some 770,000 autoworkers in the United States, senior administration officials say. The domestic auto-parts industry has fallen by half in the past decade while China's has grown seven-fold, according to those officials.

A few hours ahead of the president's speeches in Ohio, U.S. Trade Representative Ron Kirk announced the challenge:

The Obama Administration is committed to protecting the rights of nearly 800,000 American workers in our $350 billion auto and auto parts manufacturing sector. We insist upon having a level playing field on which our world-class manufacturers can compete. Today we are continuing to make it clear to our trading partners that we will fight to support each job here at home that this sector supports. Export subsidies are prohibited under WTO rules because they are unfair and severely distort international trade. China expressly agreed to eliminate all export subsidies when it joined the WTO in 2001. China benefits from international trade rules and must in turn live up to its international obligations.

The export subsidy program that we are challenging today is implemented through dozens of Chinese legal instruments. We are in a position to address this trade problem because the Administration’s newly created Interagency Trade Enforcement Center (ITEC) has provided crucial investigative and analytical resources to this effort. This is one example of how ITEC, relying on a whole-of-government approach, is expanding and accelerating the United States’ trade-enforcement capabilities and activities.

While noting that administration began pushing the matter in March, the Cleveland Plain Dealer said, "the timing of Monday's announcement is certain to take on political tones, cheered by auto- and steel-maker unions and Democrats while likely denounced as political theater by Republicans."

Sure enough, Republican candidate Mitt Romney, who has been hammering on the Obama administration on trade policy and promising immediate action if he is elected, issued a statement regarding the president's announcement:

“President Obama has spent 43 months failing to confront China's unfair trade practices. Campaign-season trade cases may sound good on the stump, but it is too little, too late for American businesses and middle-class families. President Obama’s credibility on this issue has long since vanished. I will not wait until the last months of my presidency to stand up to China, or do so only when votes are at stake. From Day One, I will pursue a comprehensive strategy to confront China's unfair trade practices and ensure a level playing field where our businesses can compete and win.”
China issued a countervailing complaint against U.S. trade abuses in the auto industry on Monday.

Originally posted to Daily Kos Economics on Mon Sep 17, 2012 at 08:20 AM PDT.

Also republished by Daily Kos Labor.

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