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USTR Nominee Schwab Queried on Trade Policy

Members of the Senate Finance Committee at her confirmation hearing Tuesday urged U.S. Trade Representative nominee Susan Schwab to take more of a hard-line approach when representing U.S. interests.

WASHINGTON — Members of the Senate Finance Committee at her confirmation hearing Tuesday urged U.S. Trade Representative nominee Susan Schwab to take more of a hard-line approach when representing U.S. interests.

“Signal to the American people that you’re hard-nosed so the American people feel that their government is actually looking out for their interests,” said committee chairman Sen. Charles Grassley (R., Iowa), noting that negotiators are sometimes too diplomatic.

Senators questioned Schwab on trade policy with China, a continual source of friction on Capitol Hill.

“I call it like it is — in the case of China, we have a lot of issues,” said Schwab, citing poor protection of intellectual property rights and the access U.S. companies have to the country. “I will be certain, if confirmed, to make this a priority.”

There are also widely held concerns that China garners an unfair trading advantage by depressing the value of its currency, though this falls more under the purview of the Treasury Department, and Schwab sidestepped questions on the issue.

Sen. Max Baucus (D., Mont.) encouraged Schwab to increase engagement with China, in part through the expansion of the U.S.-China Joint Commission on Commerce & Trade.

“The Chinese are starting to think that Americans are arrogant toward China,” Baucus said.

China is just part of the trade puzzle, which includes the global Doha talks under the auspices of the World Trade Organization, free-trade agreements with Oman, Peru and Colombia working their way through Congress, and 11 other FTAs being negotiated.

These initiatives are all complicated and under pressure because President Bush’s trade promotion authority, which mandates trade bills be voted on in Congress without amendment, expires in June 2007.

“This transition certainly has not come at the best time, given the ongoing trade negotiations in the World Trade Organization,” said Baucus.

Bush nominated Schwab, who is currently deputy USTR, last month to replace Rob Portman, who was tapped to be director of the Office of Management and Budget. Schwab reaffirmed the administration’s commitment to a Doha agreement that provides substantial trade liberalization.

“It is premature to talk about a plan B,” she said. “We haven’t given up on plan A.”

The Finance Committee is expected to vote on Schwab’s nomination next week.