Capital Hill is seen in the picture taken in Washington D.C on Oct. 11, 2011. The U.S. Senate on Tuesday passed a controversial currency bill which threatens to punish China for so-called "currency manipulation" with retaliatory tariffs, despite strong opposition from China and many U.S. business groups. The bill, namely the Currency Exchange Rate Oversight Reform Act, is especially directed at China's currency, the yuan, which the U.S. claimed is undervalued to make Chinese exports to the U.S. cheaper. (Xinhua/Zhang Jun)
by Wang Lei, Zhi Linfei
BEIJING, Oct. 12 (Xinhua) -- The U.S. Senate, in callous disregard of Beijing's strong opposition, passed a bill on Tuesday to press China to appreciate its currency, throwing bilateral trade into potential jeopardy.
With the move, some U.S. politicians are once again wooing voters by making China out to be a scapegoat for the country's domestic troubles before next year's presidential election.
However, just as in previous attempts, the Senate has taken the wrong medicine in an effort to cure U.S. chronic economic malaise.
The bill, whose passage would potentially pave the way for Washington to put a "currency manipulator" tag on Beijing and thus impose punitive tariffs on imports from China, is widely regarded as a blatant violation of free trade norms.
U.S. President Barack Obama and House Speaker John Boehner even have voiced "concerns" over the Senate move. The White House said the maneuver could "fall foul of" rules of the World Trade Organization, while Boehner warned that it was "pretty dangerous" to force a country to revalue its currency.
The bill still needs the House's endorsement and Obama's signature to become law but what the U.S. Senate did planted a ticking time-bomb that may ignite a potential trade war between the world's two largest economies.
The possible U.S. unilateral imposition of high duties on Chinese imports on the pretext of Beijing's alleged currency manipulation would certainly lead to China's retaliation.
Chinese Vice Foreign Minister Cui Tiankai said Monday that the U.S. move in no way represents the reality of the economic and trade relationship between China and the United States and that it might have an adverse impact on bilateral ties.
The current bilateral trade imbalance is not caused by the so-called yuan undervaluation, but by the structural shift in the United States to a service-based economy and Washington's unwise curbs on high-tech exports to China.