WASHINGTON, DC – On a bipartisan 63-to-35 vote, the U.S. Senate tonight approved a measure to strengthen U.S. trade laws and place new duties on goods from China and other countries that manipulate their currencies for trade advantage.

For years the Chinese government has maintained its currency at an artificially low value to keep China's exports cheap and make American imports to China more expensive.

U.S. Senator Jack Reed (D-RI), an original cosponsor of the Currency Exchange Rate Oversight Reform Act of 2011, was among the 63 senators voting to pass the bill to make it easier for the U.S. Department of Commerce to vigorously investigate allegations of currency manipulation by foreign governments.  The bill would also make it harder for the U.S. Treasury Department to avoid labeling countries that violate the rules as a “currency manipulator.”  U.S. companies and workers hurt by illegal subsidies, like Chinese currency manipulation, could ask for countervailing duties to be placed on Chinese products to help level the playing field.

“This bill will help create jobs and put a stop to Chinese economic and trade policies that are hurting American businesses and costing Rhode Island jobs.  This bipartisan bill sends a clear bipartisan message that the U.S. will hold China accountable for its currency and market manipulation,” said Reed.

A recent report from the Economic Policy Institute (EPI) estimated that if the renminbi  and satellite currencies were revalued to their equilibrium level, up to 2.25 million jobs could be created through an increase in U.S. Gross Domestic Product (GDP).  EPI found the trade deficit with China grew from $84 billion in 2001, when China entered the World Trade Organization, to $278 billion in 2010.  It eliminated or displaced 2,790,100 American jobs, or about 2% of total U.S. employment over that period.

Rhode Island was one of ten states nationwide where the jobs lost or displaced exceeded 2.2% of total employment.  The other states were: New Hampshire, California, Massachusetts, Oregon, North Carolina, Minnesota, Idaho, Vermont, and Colorado.

According to the EPI study, 11,890 jobs across Rhode Island have been erased over the last decade due to the surging trade deficit with China, which continues growing at over 14% annually.

A separate study by a team of leading economists found that from 1990-2007 the Providence metropolitan area was one of the most vulnerable communities to cheap Chinese imports.

Now that it has passed the full U.S. Senate, the bill must also be approved by the U.S. House of Representatives.  Although several Republican senators voted for final passage of the bill, the Republican leadership in the House has threatened to prevent the bill from coming to a floor vote by the full U.S. House of Representatives.