A member of the House appeared before the commission alleging that China is manipulating its taxes and currency to keep wages artificially low as a way to keep U.S. businesses from gaining full access to the Chinese market. China undervalues its currency—the yuan—and provides Chinese companies with a 17 percent tax rebate that is funded by taxes imposed on American-produced goods, said U.S. Rep. Duncan Hunter, R-Calif. That makes it difficult for American manufactures to compete fairly in the global market, he said. “It is this uneven playing field that undercuts American markets and wipes American products off the world’s shelves,” he added.The idea of “free trade” with China is “a simplistic ideal” because the reality is that China is conducting “predatory trade” supported by low wages, Hunter said. Wages in China range from 25 cents to $1.50 per hour in some areas, and companies can get “pretty skilled Chinese labor” for 25 cents per hour, he said.
The old Farmer-Labor Democrat Party was said to represent the worker, with big business represented by the GOP. Both workers and manufacturers lose out with trade policies like these, and both the Democrats and Republicans can share the blame. But as we approach the next election year, you would think there would be a mad dash to fix it if for no other reason than to get the support of labor and/or business groups like NAM. So far, all is quiet on the fair trade front.