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The Yuan Talk Gets Tougher

posted by Darren Gersh, Washington Bureau Chief at 6:29 PM on 06/13/07

Photo of Darren GershThe temperature of US-China trade relations is rising again. Last year, Senators Chuck Schumer and Lindsey Graham pulled their China trade bill. At the time, they said they wanted to give Henry Paulson, the new Treasury Secretary, time for his high-level approach to negotiations to work. Well, Paulson has now twice brought together most of the President's cabinet for meetings with Chinese counterparts. The results have been limited, and Congress is losing patience.

Now, Schumer and Graham are back. This time, they are backing a bill that would tie the undervalued yuan to US dumping laws. If the Chinese don't make changes, the yuan could be used to figure anti-dumping duties on Chinese products. That would be tough medicine for US-China trade relations. Experts say the handwriting is on the wall. The question is whether Beijing will read it or not.

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What China wants, China gets. Hot air from Washington won`t change the fact that our borrowing excesses have put China in the drivers seat, about a third of a trillion dollars worth. If China dumps our bonds who will be next??? Jerry

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