Trade with China: And now protectionism

With the global economy at a horrible state right now, United States might be adding to the spark with the implementing a new bill that might start a trade war with China. The Senate recently approved the "Oversight Reform Act" which "would allow any 'fundamentally misaligned' currency to be labelled a subsidy subject to countervailing duties." Many bills of the same sort have been tried to be passed but were inherent failures. This one is different, because both parties are growing in their anti-Chinese sentiments.

Raising barriers with China is an unhealthy policy for US. China could retaliate and take matters to WTO. Implementing tariffs on China is a legitimate cause for them to successfully file a complaint against the US. This is partly due to the Yuan's consistent appreciation (7%) against the dollar. It is definitely causing an unrest within American politics. The protectionist route may cause intense changes in the already shattering economy and could ultimately start a trade war withing the two states. It is not advisable to Obama to promote this bill, but rather veto it if it ever reaches his desk.

http://www.economist.com/node/21532288

Pooja Sahai