CNN Lou Dobbs Tonight - Transcript

CNN

SHOW: LOU DOBBS TONIGHT 18:00

December 9, 2003 Tuesday

HEADLINE: President Bush Welcomes Chinese Premier to White House; Interview With Senator Charles Schumer

GUESTS: Peter Nunez, Stephen Roach, Charles Schumer

BYLINE: Christine Romans, Casey Wian, Lisa Sylvester ,Bill Tucker, Jamie McIntyre, Suzanne Malveaux, Peter Viles, Holly Firfer, Lou Dobbs

HIGHLIGHT:
President Bush welcomes Chinese Premier Wen to the White House. The U.S. trade deficit with China could rise to a record $130 billion this year, as Chinese imports flood into this country. Is America's immigration policy in a meltdown? U.S. health officials say they may seek flu vaccine from outside the country. Senator Charles Schumer discusses whether China's currency manipulation is costing millions of Americans jobs.

BODY:
DOBBS: Chinese Premier Wen Jiabao will be visiting the United States over the course of several days. And he has agreed to currency talks with the Bush administration next month. By keeping Chinese currency artificially weak, Chinese goods, of course, cheaply flood the U.S. market.

I'm joined now by a lawmaker who has introduced legislation designed to end China's currency manipulation, Senator Charles Schumer.

Good to have you here.

SEN. CHARLES SCHUMER (D), NEW YORK: Hey, great to be here, Lou.

DOBBS: Senator, how will your legislation influence the Chinese?

SCHUMER: Well, it's very simple.

Our legislation says that countries, large countries, that don't let their currency float shall have a tariff tacked on to make up for the devaluation of the currency. It's estimated that the Chinese currency is lower than it ought to be by 40 percent to 15 percent. So we picked the middle number, 27.5 percent.

And it-I'd much rather the Chinese float their currency. I'd much rather let the Chinese let currency flow back and forth over their borders, like any large, grown-up country should do.

DOBBS: This is a large, grown-up and immensely powerful, potentially, country. The idea that we would be dictating to the Chinese, or they to us, about currency is problematic at best. Do you think this administration is ready to follow such legislation, to support it, and to enforce it?

SCHUMER: Well, let's look at what happened today. We get virtually nothing from the Chinese but verbiage, as so many thousands of jobs are lost.

The Chinese have certain advantages, in any case, that no currency change is going to matter. And this is not going to solve all of those problem. But I have manufacturers in my state-and it's true around the country-who say, that 40 percent advantage is what kills me. I'll compete with lower costs of Chinese labor, but not with a 40 percent extra tacked on that makes it unfair.

So we have do something. Now, if the administration has a better plan, fine. But they have done nothing.

DOBBS: Talking here with Commerce Secretary Don Evans, he said, we want a level playing field. We are going to be addressing these issues.

But you and I, and I think nearly everyone watching and listening to us right now, understands, U.S. multinationals are the ones investing capital in China and other countries around the world, not simply China.

SCHUMER: You bet.

DOBBS: They are the ones who have chosen to outsource high-value jobs in the United States and put them in other countries.

SCHUMER: Yes, you bet.

DOBBS: China, India.

What in the world is the Democratic Party going to-since you are a Democrat, I will ask you this.

(CROSSTALK)

DOBBS: What is the Democratic Party going to do, the Republican Party going to do? Because neither party is dealing with this issue.

SCHUMER: Right. Exactly.

I think this is the hidden issue of the 2004 election. The areas where it has particular resonance are the middle-West, all those swing states, Pennsylvania, Ohio, Michigan, and the Southeast, where all those Senate seats are up. And it's huge in those areas.

And the American worker, the American people, are looking for solutions. Yes, it's the big multinationals that can go to China. We don't want to say, you can't go to China. We do want to say, when you go to China, you shouldn't get an extra 40 percent or 30 percent advantage tacked on because there are currencies unfairly manipulated.

DOBBS: Will you be making your determination about whom you support for the Democratic presidential nomination based, in part, on their views on trade?

SCHUMER: In one of these issues, yes.

And I've been a free trader. I lost the AFL-CIO endorsement when I was a congressman because of my positions. But this is a free trade position, to say that currencies should float. Part of the tenet of free trade is, you let goods flow freely back and forth, but the currency floats, too.

(CROSSTALK)

SCHUMER: And so it avoids too great an imbalance. We're not doing that. And it's just utterly amazing to me. What happened today is what always happens. We trade economics for diplomacy, today, in the case of Taiwan.

We're not getting anything done to keep our economy vigorous and strong, whether it be manufacturing, services or anything else. And two years from now, Lou, we're going to regret this. Right now, no one's paying too much attention. But we are going to regret it.

DOBBS: Well, there are a few folks paying attention.

SCHUMER: Yes. True.

DOBBS: Senator...

SCHUMER: You are one of them, thank God.

DOBBS: And you, sir.

We appreciate it, Senator Schumer. Good to see you.

SCHUMER: Thank you. Appreciate it.