Record trade deficit spurs renewed call to China Free the yuan!

Oct 14, 2005 | 06:25 AM |

The record bilateral trade deficit with China, pegged at $18.5 billion in August, has prompted renewed calls for China to end alleged currency manipulation and allow the yuan to float, as other major currencies do.

The China Currency Coalition said the trade deficit would continue to hurt U.S. manufacturing, including the domestic steel industry, until China stops artificially pegging its currency to the value of the U.S. dollar.

The coalition, an alliance of industry, agricultural and worker organizations that has accused the Chinese of deliberate currency manipulation, issued its statement last week after the Commerce Department announced that the U.S. trade deficit had widened to $59 billion in August. The $18.5-billion deficit with China was up 4.5 percent from $17.7 billion in July.

"These numbers clearly demonstrate that the annual bilateral trade deficit (with China) continues on its trajectory of reaching almost $210 billion in 2005, nearly a 30-percent increase over the previous high of $162 billion in 2004," David A. Hartquist, counsel for the China Currency Coalition, said in a statement. "U.S. workers should no longer have to shoulder the burden of China's export-led strategy."

The coalition cited U.S. Labor Department statistics that show 14,000 manufacturing jobs were lost in August, resulting in a cumulative decline for the past 12 months of 90,000 jobs. "Since January 2001, 2.8 million manufacturing workers have lost their jobs, and there is no reason to expect this downward trend to change," Hartquist said.....