Bickering political parties share China as target

AP News
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Posted: Oct 30, 2010 12:06 PM
Bickering political parties share China as target

In these angry political times, Democrats and Republicans agree on next to nothing. China is an exception.

Democrats and Republicans are accusing each other of cozying up to Beijing and backing policies that send U.S. jobs and IOUs to the world's second-largest economy.

Hot rhetoric in the closing days of the election has helped to fan protectionism sentiment in the U.S., casting doubt on the fate of free-trade agreements and complicating U.S. dealings with a muscle-flexing China.

This America-first sentiment _ against a background of continued high unemployment, a snail's pace recovery and heated political attack ads _ seems likely to carry over to the next Congress, no matter who wins control of the House and Senate in Tuesday's voting.

That anti-trade message is not good news for President Barack Obama as he heads to Asia in early November. His trip includes a 20-nation summit in South Korea of the world's largest and fastest-growing economies.

That gathering had been seen as an opportunity to ease global trade tensions and to recent flare-ups between the U.S. and China over currency, exchange rates, climate change and security. Instead, it could end up emphasizing unresolved differences.

In this election season, foreign policy is seldom mentioned, yet China has become a prime economic target.

California Sen. Barbara Boxer upbraids Republican rival Carly Fiorina for sending jobs to "Shanghai instead of San Jose" as Hewlett Packard's former chief executive.

Senate Majority Leader Harry Reid, D-Nev., calls tea-party backed Republican challenger Sharron Angle "a foreign worker's best friend" for supporting tax breaks for "outsourcing to China and India."

Connecticut Democratic Senate candidate Richard Blumenthal slams Republican Linda McMahon, former chief executive of World Wrestling Entertainment, because her company gets its action figure toys from China, not the U.S.

Democrat Lee Fisher of Ohio says his GOP rival for the Senate, Rob Portman, "knows how to grow the economy _ in China." Portman was the top trade and budget official for President George W. Bush.

Democrats long have accused the GOP of policies that ship U.S. jobs overseas. This season, Republicans are returning fire.

In West Virginia, Republican House candidate Elliott "Spike" Maynard aired an ad featuring Asian music and a photo of revolutionary leader Mao Zedong to reproach Democratic Rep. Nick Rahall for backing stimulus legislation that gave tax breaks to companies that bought wind turbines from China.

House Minority Leader John Boehner, R-Ohio, blamed Obama and House Speaker Nancy Pelosi, D-Calif., for a "stimulus that shipped jobs overseas to China instead of creating jobs here at home." He's expected to replace Pelosi as speaker if Republicans win control of the House.

Republicans generally have supported reducing barriers to free trade; Democrats have been more skeptical, due to opposition from labor unions and environmental groups. But this year, everything is upended with the retirement or rejection of moderate Republicans, the rising tea party movement and public hostility toward trade in general and China in particular.

The House Republicans' "Pledge to America" doesn't mention free trade. The House voted 348 to 79 last month to bolster the government's power to slap tariffs on Chinese imports. "Buy American" provisions in legislation are winning by wide bipartisan margins.

Polls suggest many in the U.S. blame China for the continued loss of U.S. jobs, particularly in Rust Belt states. Many also seem troubled that China remains the world's largest holder of U.S. debt and has bounced back so quickly from the global economic crisis. It raised interest rates last week _ while most other major economies are keeping them low _ to keep its economy from overheating.

In a recent NBC-Wall Street Journal poll, 53 percent of those surveyed said free-trade agreements have hurt the U.S. Among those who identified themselves as tea-party supporters, the proportion was 61 percent.

"Think of it. The ground troops for both parties _ tea party Republicans and union Democrats _ believe free trade is bad," suggests Robert Reich, who was labor secretary in the Clinton administration and is now a professor at the University of California, Berkeley.

Alan Tonelson, research fellow at the U.S. Business and Industry Council, which represents small and mid-sized manufacturers, said the jury's still out on how tea-party influence will shape trade decisions. He notes a split between libertarian-leaning conservatives who may favor ending all government restrictions on trade and those who want to do more to protect home industries.

"The tea party certainly at its grass roots is an economic populist movement. And populist movements tend to take a very dim view of U.S. trade policy," he said. "Tea party social conservatives are also very worked up about China."

Languishing free-trade pacts with South Korea, Colombia and Panama _ negotiated during the Bush administration _ may be casualties of the rise in protectionism sentiment.

Obama has pledged to revive these pacts, saying they're good ways to expand exports and increase American jobs. But the trade measures have generated little enthusiasm or support on Capitol Hill.

That could be awkward for Obama since South Korea is the host of the Nov. 11-12 Group of 20 summit. Even if the U.S. and South Korea can announce a framework agreement, it's no sure bet in Congress.

The campaign-trail rhetoric against China "makes it a lot more awkward" for Obama to deal in Seoul with both South Korean and Chinese leaders, said Fariborz Ghadar, a senior adviser at the Washington-based Center for Strategic and International Studies. But he said he hoped "more reasonable" minds would prevail after the heat of the election dies down.

But Jeffrey Schott, a senior fellow at the Peterson Institute for International Economics, says the "bigger problem for Obama is that unemployment still hovers just below 10 percent. And when you have rates of unemployment that high, you are going to see extensive protectionist pressure. It's just the nature of things when people are out of work."