Obama eyes more money for China trade enforcement

WASHINGTON Mon Feb 13, 2012 4:00pm EST

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WASHINGTON (Reuters) - President Barack Obama, on the eve of a high-level Chinese visit to the United States, proposed $26 million in new funding to make sure China and other countries play by the rules of international trade.

"This is designed to increase our capacity to bring additional trade cases that will level the playing field against countries around the world, including China," White House economic advisor Gene Sperling told reporters on Monday.

The increased funding would be used to hire 50 to 60 new people and improve the coordination of U.S. government action against unfair foreign trade practices, he said.

The administration also proposed increasing funding for the Commerce Department's International Trade Administration by 14 percent to $517 million to help meet Obama's goal of doubling U.S. exports by the end of 2014.

Obama first outlined his plan for an interagency trade enforcement center last month in a speech to Congress.

He took particular aim at China, which he accused of lavishing subsidies on its companies and not doing enough to stop counterfeiting of American goods.

The budget proposal comes as China's likely next leader, Vice President Xi Jinping, is headed to the United States for talks on Tuesday with Obama, Vice President Joe Biden and other senior administration officials.

The visit also comes on the heels of trade data on Friday, which showed the U.S. trade deficit with China widened again in 2011 to a record $295.5 billion.


Acting Commerce Deputy Secretary Rebecca Blank said $24 million of the new funding would go to the Commerce Department's International Trade Administration (ITA) and the remaining $2 million to the U.S. Trade Representative's office.

The ITA houses the Foreign Commercial Service, which gathers intelligence on foreign markets and promotes U.S. exports around the world, and the Import Administration, which handles anti-dumping and countervailing duty cases.

The new interagency unit "will serve as the primary forum within the federal government for executive department and agencies to coordinate their enforcement of international and domestic trade rules," Blank said.

Further details will follow in several weeks, including where the new workers will be assigned, but "the idea is that USTR and ITA together are going to help set this up," she said.

Republicans welcomed the emphasis on enforcement, but were waiting for more details about the new unit.

"In addition, enforcement is only one side of the trade equation. We must still push forward aggressively with opening new markets," said House of Representatives Ways and Means Committee Chairman Dave Camp, expressing disappointment there was little in Obama's budget on that front.

The Obama administration has filed five cases against China at the World Trade Organization since taking office in January 2009. It also used for the first time a special "safeguard" measure to curb tire imports from China and has slapped countervailing and anti-dumping duties on a number of Chinese goods it says were subsidized or unfairly priced.

(Reporting By Doug Palmer; editing by Christopher Wilson)

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Comments (3)
The most effective and cheapest way to enforce American intellectual property laws on fake foreign goods is:

hold all businesses operating in America liable for importing fake and substandard goods.

Right now, many suave lawyers help greedy American businesses, who had made a lot of money selling substandard or fake goods from foreign countries, get away with practical economic “murder” by convincing the juries that the American businesses should be acquitted because only the foreign companies are liable. In fact, most of these American businesses know what they are doing, and keep doing it BECAUSE many others have gotten away with it, and they are confident that they can too, by saying it’s all the foreigners’ fault.

The truth is: it’s all fake talk. Most of these companies are wilfully blind to blatant evidence that the goods were substandard or fake or violate patent laws. They just can’t walk away from those profits because so many others have gotten away with it by arguing in court that they should not bear the penalty of “bad” foreign companies.

The truth is that the foreign manufacturers are often not violating their local laws. And we cannot force other countries enact laws. On the other hand, many American big businesses are getting away with “economic murder” in the American justice system, because they prey on the false belief that the American businesses were innocent in getting those goods. American tort laws have long held sellers liable for checking, inspecting for any substandard, fake or illegal goods, as long as the merchant, the importer, or retailer is within the chain of business transactions that resulted in the product being placed on the shelf for sale in America.

However, many defense lawyers have successfully helped big businesses get acquitted in court. These lawyers make obscene amount of money and have every reason to believe they can perpetuate this false concept in the media, in the advertising, in the reporting. ALL the costs get added back on too the little guys like you and me, who buy these substandard or fake items.

The laws are already there. They are just not enforced. Congress needs to pass laws to make sure that big American businesses won’t be immune and continue to get away with this “economic murder” as it is now. Obama administration can prosecute violations diligently.


Eg., when the substandard drywalls were discovered, major TV networks openly asked, who should pay for it when we can’t get the chinese?! Those ridiculous questions imply that American businesses, many from the top 1%, should not be asked to abide by the law because it was totally the foreign companies’ fault. Of course, these smart lawyers seized upon that and made themselves rich, and the richest American companies richer. THAT is the root problem.

Obama can instruct the attorney general to prosecute strictly by American law, rather than do nothing while berating foreign laws. Congress can pass legislation explaining that the laws were to be strictly adhered to, and that American businesses cannot avoid liability by blaming the lack of foreign laws. If those 2 things are done, and they practically should not cost anything more than the current government staff doing their jobs appropriately and strictly, much of the problem intellectual property violation will evaporate, as our laws were intended the work.

Feb 13, 2012 8:55pm EST  --  Report as abuse
FoxxDrake wrote:
first, that was some comment. I stopped reading after the first page.

second, the Chinese send us dry wall in the tooth paste…DRY WALL.

it’s hyper-capitalism run amok.

Feb 14, 2012 10:17am EST  --  Report as abuse
Mott wrote:
Sub-standard goods.. I hit a nail recently with hammer made in china, and the hammer broke.

Feb 14, 2012 10:27am EST  --  Report as abuse
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