AFL-CIO Files China Labor Case with USTR
First-time move by a trade organization against a US trading partner
WASHINGTON, DC - 03/17/04 - The AFL-CIO - the nation's largest labor organization - is filing a case with the Office of the US Trade Representative (USTR) alleging that China's "repression" of its workers violates US trade law.
The move by the group - which represents about 13 million workers in 64 trade unions - is the first time that an entity other than a company has sought punitive action against a US trading partner under the provisions of Section 301 of Trade Act of 1974.
Complaints usually arise from complaints by a firm or group of firms that believe foreign competitors are getting government subsidies or unusual tax breaks.
In 1988, Congress amended the trade laws to include labor standards as a basis for filing trade complaints. Until now, the provision has not been used.
The AFL-CIO's 105-page petition contends that the Chinese government's "persistent pattern of repressing labor rights" has created "a huge pool of cut-rate labor that has displaced as many as 1.2 million US jobs."
According to press reports, the AFL-CIO is asking the Administration to impose quotas or tariffs to raise the cost of Chinese-made goods.
The petition argues the tariffs "would pressure Beijing to comply with international labor laws" and asserts that "the scale and degree of government-engineered labor exploitation in China is such that it clearly distorts global labor markets. If not for China's repression of workers' rights, the extraordinary losses in US manufacturing jobs and wages would be significantly curtailed."
US Trade Representative Robert Zoellick will have 45 days to decide whether to take the case.
If he doesn't move on the petition, says Thea Lee, the AFL-CIO's assistant director for international economics, "We will make it a campaign issue."
The labor federation, which nearly always supports Democrats, has already publicly announced its support for Sen. John Kerry in this year's run for the White House against President Bush.
The White House refused to comment on the merits of the AFL-CIO petition, but Richard Mills, a spokesman for the USTR's office, said that the US has been "a leader in promoting internationally recognized labor standards and human rights globally, especially in those countries where those standards are not fully upheld."
Mills said that the administration was "committed to aggressively enforcing our trade laws to ensure that US companies can compete on a level playing field."
Over the past several months, the Administration has been pressuring China to halt its practice of linking the value of its currency - the yuan - to the US dollar.
US manufacturers say that this has allowed the yuan to be undervalued by as much as 40% against the dollar, giving Chinese goods a marked price advantage over American-made products.
The National Association of Manufacturers (NAM) has said that the Fair Currency Alliance, a coalition of groups including NAM and the AFL-CIO, are working to prepare a Section 301 case on the currency issue, which it said should be "ready to file in the not too distant future."
Chinese officials, however, have resisted pressure by the administration to allow the yuan's value to be set by currency markets, saying that too much currency volatility could "destabilize" the country's fragile banking system.
In Beijing, the Commerce Ministry refused comment on the either the AFL-CIO petition or the proposed Section 301 currency case.
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