WASHINGTON — When it comes to managing the tense economic relationship with China, Christopher Padilla, under secretary for international trade at the Commerce Department, has a simple message for Congress: the Bush administration has it covered.
"We cannot control or direct China's decisions, we can only influence them," he said during a speech last week at the Center for Strategic & International Studies. "So the question is what combination of policies would be most effective in influencing China's behavior. The blunt instrument of punitive legislation won't work."
Capitol Hill lawmakers are considering myriad ways to crack down on China, which many accuse of unfairly supporting its industry with an undervalued currency, unfair subsidies and other favorable treatment. Among the legislative actions under consideration are blanket tariffs to counteract the impact of currency manipulation and taking the relative value of currencies into account when administering unfair trade cases. It is unclear which approach has the most traction.
"Many of the pending bills are designed not to solve problems in China, but simply to reduce U.S. imports from China," he said.
Instead, Padilla advocated for continued engagement during what he described as a "critical juncture," when protectionist sentiments on both sides of the Pacific are stirring.
In addition to high-level meetings where U.S.-Sino issues can be addressed, such as the Strategic Economic Dialog, the Bush administration has taken trade complaints against China to the World Trade Organization and broadened U.S. trade remedy policies so companies could bring countervailing duty cases against nonmarket economies like China.
Deferring to the Treasury Department on the broader question of China's currency policies, which some allege keep the yuan undervalued by as much as 40 percent, Padilla made a case for not including currency considerations in antidumping and countervailing duty trade cases that are handled by his department.
Antidumping and countervailing duty cases can lead to higher tariffs on goods from selected countries and are a chance for relief from imports that are deemed to be sold at unfairly low prices. An artificially depressed yuan could have a big impact on prices, making goods made in China cheaper to buy with dollars, but taking that into account is difficult to do and potentially harmful, said Padilla."In this time of economic uncertainty, as Congress and the administration work together to stimulate growth, it would be very unwise to pass legislation that could inflate consumer prices," he said.
"The deficit is driven by many complex factors, including relative growth and relative interest rates, relative savings rates and others," said Padilla. "Passing currency legislation won't make the trade deficit go away."
For the first 11 months of last year, the U.S. goods deficit with China hit a record $237.5 billion, larger than the 2006 tally.
@zacposen's go-to holiday gift? Cookies! "I'll usually bake cookies and send them as a gift," said the designer, who recently released his cookbook "Cooking With Zac: Recipes from Rustic to Refined." Get the recipe for his Brown Butter-Chocolate Chip Cookies via link in bio 🍪🍪🍪 #wwdeye #cookingwithzac
For @monsemaison’s pre-fall 2018 collection, Fernando Garcia and Laura Kim honed in on the brand’s many signatures — men’s wear, which was tweaked and feminized through deconstruction, proportion play and lots of bare shoulders. See the rest of the photos on WWD.com #wwdfashion (📷: George Chinese)
On Friday night, @yohjiyamamotoofficial received the Design for Asia Lifetime Achievement Award in Hong Kong. The 75-year-old designer has been celebrated for many years and is best known for his dark and avant-garde tailoring. “In my long career, in design, architecture, [I’ve been to] so many parties, this is the very first time that I have such a warm feeling, I really appreciate this,” Yamamoto said. #wwdfashion (📷: @dominiquemaitre)
Discovery is collaborating with British pop artist @philipcolbert on a new line of clothing and accessories called Discovery Shark. The collection, which will launch next summer for Shark Week’s 30th anniversary, features a whimsical line of women’s and men’s bomber jackets, sweatshirts, bags and more. #wwdfashion
“I’m always a big champion of a female rapper, and I’m glad to see a new voice that feels unique and authentic that’s coming up, and I think we’re going to see more great things from her,” said @itsjeremyscott about @iamcardib, who performed at @moschino’s Art Basel Miami Beach party last night. #wwdeye (📷: @lexieblacklock)
@janellemonae’s “What’s Your Frequency?” room in @refinery29's #29Rooms made its debut this week at the opening of the Los Angeles art exhibit. “It’s about the ongoing conversation around mass surveillance, the weaponization of technology and cultural uniformity. My space was created so that we can come together and talk about the complexities of our humanity,” said Monáe. #wwdeye (📷: @bucknerphoto)
@pantone announced their Color of the Year 2018: Ultra Violet. Nearly 20 months after the musician Prince’s death, fashion is having a purple moment. Varying shades of purple appeared on spring or fall runways, from @christopherkane to @calvinklein. @gucci’s Alessandro Michele bathed his fall runway in ultra violet-colored light at one point. Pantone 18-3838 is meant to “push the boundaries of what inspires us to look upward and outward to the future.” #wwdnews #wwdfashion (📷: @kukukuba)