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Obama Challenges China Auto Subsidies

Kent Klein

September 18, 2012

The Obama administration is complaining to the World Trade Organization, or WTO, that China is illegally subsidizing exports from its automobile and auto-parts industries. President Barack Obama made the announcement on Monday at a campaign rally in the swing state of Ohio, whose economy relies heavily on auto manufacturing.

“Today, my administration is launching a new action against China, this one against illegal subsidies that encourage companies to ship auto parts manufacturing jobs overseas," said President Obama. "These are subsidies that directly harm working men and women on the assembly lines in Ohio and Michigan and across the Midwest.”

The U.S. Trade Representative has filed a complaint with the WTO, charging that China has given “extensive subsidies” to Chinese companies that produce autos and parts for export.

U.S. trade officials say they are also taking further action in another case filed in July against Chinese duties on American auto exports. The president announced that case in a previous campaign trip to Ohio.

In Cincinnati on Monday, Obama strongly criticized his Republican opponent, former Massachusetts Governor Mitt Romney's business experience.

The company Romney started, Bain Capital, invested in some companies that “outsourced,” or shifted jobs out of the United States. The president called Bain's leaders “pioneers in outsourcing.”

“He made money investing in companies that uprooted from here and went to China. 'Pioneers.' Now, Ohio, you cannot stand up to China when all you have done is sent them our jobs.”

Romney responded at a business gathering in Los Angeles, California.

“Now, the president may think that announcing new trade lawsuits, less than two months before the election, will distract from his record," said Romney. "But American businesses and workers struggling on an uneven playing field know better. If I had known that all it took to get him to take action was to run an ad, citing his inaction on China's cheating, I would have run one a long time ago.”

Romney has long been critical of the president's performance on the China trade issue, and he has promised tougher action to enforce trade laws.

With 49 days remaining before the election, many public opinion surveys show Obama with a slight lead nationwide.

The president leads Romney by as many as seven percentage points in Ohio, a state many analysts say will play a key role in determining the outcome of the November 6 election.

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