Defying long odds and opposition from China, the US business community and the White House, the US Senate presses ahead Thursday with a measure to punish Beijing for its alleged currency manipulation. The bill, which calls for retaliatory tariffs on Chinese goods if the yuan is found to be unfairly "misaligned," faces a critical procedural vote set for 10:30 am (1430 GMT) in which it will need support from 60 senators to survive. But even then it would need a final ballot in the Democratic-led Senate -- and would face an uphill fight in the Republican-held House of Representatives, where Speaker John Boehner has signalled the "dangerous" legislation will die. Aides say it could return to life if China's currency somehow became a core dispute as President Barack Obama faces off with his as-yet undetermined Republican foe ahead of the November 2012 elections. That contest is sure to turn on deep voter anger at the sour economy's sluggish recovery from the global meltdown of 2007-2008, with stubbornly high unemployment of over nine percent a drag on Obama's bid for a second term. Known to oppose the bill in private, the White House on Wednesday said it was lobbying Congress to address "concerns" that the legislation could violate US obligations under international trade rules. But spokesman Jay Carney said that the White House shared the view that China's currency needed to appreciate to what Washington says is a fairer value and agreed American workers needed a "level playing field." Few in Washington challenge the charge that China keeps the yuan unfairly low against the dollar, giving its goods as much as a 30 percent edge over comparable US products, widening the US trade deficit and costing US jobs. But the measure's opponents say it risks sparking a trade war with China, and say a rise in the yuan will boost manufacturing and therefore jobs in countries like Vietnam or Malaysia -- not in the United States. And they say that, if successful, the bill will increase the cost of commodities or consumer goods from China, hurting rather than helping US businesses and families. The legislation's backers have said it's time for Washington to take on Beijing, and predict a boost in the yuan will making Chinese workers wealthier and more likely to buy US goods -- creating jobs and narrowing the trade gap. They have also said that current US law and multinational dispute mechanisms have failed to curb what they call Beijing's unfair practices, which also include favoring Chinese producers for government contracts and tolerating rampant intellectual piracy. China's top newspaper -- the People's Daily, seen as the Communist Party's mouthpiece -- slammed US lawmakers on Wednesday for touting the bill as a cure-all for economic troubles they have failed to address. "Faced with the discontent of the American people, some US lawmakers are using the Chinese currency to pass the buck over their political incompetence," said the paper, echoing angry denunciations from Chinese officials all week. Those attacks drew a scathing response Wednesday from Democratic Senator Sherrod Brown, the legislation's top champion, who compared decisionmakers in Beijing to a "pack of dogs" yelping in anger at the bill. "Where I come from, they say when you throw a rock at a pack of dogs, the one that yelps is the one you hit," he said in a speech on the Senate floor. "Of course the Chinese are going to yelp because they don't like this." The senator, who represents the rust-belt heartland state of Ohio, pointed to a chorus of condemnation from Beijing against the bill, and said "they're not happy when we do this, but that doesn't mean it's not the right thing." "We're saying to them you've got to follow the rules, no more breaking the rules. You can't cheat the way you've cheated," he said. But the legislation has split the top two Republican White House contenders, with Texas Governor Rick Perry opposing it and former Massachusetts governor Mitt Romney saying he would confront China on his first day in office.
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