WASHINGTON (Reuters) - A bipartisan group of senators on Thursday was set unveil a new bill to "crack down" on China currency practices that they blame for millions of lost American jobs over the past decade.
The legislation combines two separate bipartisan bills -- one championed by Democratic Senator Charles Schumer and Republican Senator Lindsey Graham; the other Senator Sherrod Brown, a Democrat, and Senator Olympia Snowe, a Republican.
Senators have set a news conference on Thursday to discuss the legislation.
A key provision would direct the Commerce Department to treat currency undervaluation as an illegal subsidy under U.S. trade laws. That would allow companies to apply for countervailing duties on a case-by-case basis.
The U.S. House of Representative passed that same provision last year on a bipartisan vote of 348-79.
Since then, control of the House has shifted from Democrats to Republicans, whose leaders have not made a priority of passing China currency legislation.
But the House bill's chief sponsor, Representative Sander Levin, a Democrat, has reintroduced the bill and it currently has 145 Democratic and 56 Republican co-sponsors. That is just 17 short of the 218 votes needed for House passage.
When House Republicans were in the minority last year, 99 voted for the legislation, 74 voted against and 5 abstained.
The left-leaning Economic Policy Institute estimated in a report this week that the huge U.S. trade gap with China has cost the United States 2.8 million jobs over the past decade.
The U.S.-China Business Council, which represents American companies that do business with China, said the report was based "on the faulty assumption that every product imported from China would have been made in the U.S. otherwise."
A group of 51 business and farm groups, including the U.S. Chamber of Commerce and the Business Roundtable of corporate chief executives, also have warned of the possible adverse effects of passing a bill.
"Legislation that would increase tariffs on imports from China is unlikely to create any incentive for China to move expeditiously to modify its exchange policies," the groups said in a letter to lawmakers on Wednesday.
"Rather, it would likely have the opposite effect and result in retaliation against U.S. exports into China -- currently the fastest-growing market for U.S. exports."
China rejects criticism that it deliberately undervalues its currency to give its companies an unfair price advantage in international trade. It says it is committed to moving to a more flexible exchange rate, but at its own pace.
Last week, China's Foreign Ministry urged U.S. lawmakers not to resort to "excuses" for trade protectionism after U.S. Senate Democratic leader Harry Reid said he planned to push legislation aimed at forcing China to loosen controls on its currency.
(Reporting by Doug Palmer; editing by Mohammad Zargham)