Wes Hickman (202-224-5972) or Kevin Bishop (864-250-1417)

U.S. Senators Charles Schumer (D-NY) and Lindsey Graham (R-SC) today formally submitted their request to Senate leadership for a vote on the Schumer-Graham Free Trade Act. Last April, The Schumer-Graham legislation received 67 votes on a procedural vote and is scheduled for an up-or-down vote before September 30th. Schumer and Graham’s letter today formally requests floor time by the end of this month. “We’ve been very patient, but have seen little progress,” Senator Schumer said. “The Senate will be voting on our bill if China doesn’t make a significant move very soon. Time is running out. I hope that Hank returns with tangible results, but if the disconnect between China’s rhetoric and actions is any guide, we’ll have no choice but to call for a vote.” “Senator Schumer and I have been patient and flexible,” said Senator Graham. “We agreed to delay a vote on our legislation on three separate occasions. Most recently, in March we agreed to delay a vote for six additional months to give the Chinese additional time to revalue their currency. We have been determined and we have been reasonable. Now, the date of our promised vote is approaching and we are sorely disappointed with China’s pace of reform.” The Schumer-Graham Bill (S. 295) allows for a 180-day negotiation period between the United States and China on currency revaluation; if the negotiations are not successful, a temporary across the board tariff of 27.5% will be applied to all Chinese products entering the United States. If the President certifies to Congress within 180 days of enactment that China has made a good-faith effort to revalue its currency upward, he may delay the imposition of the tariffs for an additional 180 days. If at the end of that 180-day period the President determines that China has developed and started actual implementation of a plan to revalue its currency, the President may delay imposition of the tariffs for an additional 12 months. The text of the letter is below: September 14, 2006 The Honorable William H. Frist Senate Majority Leader 509 Hart Senate Office Building Washington, DC 20510 The Honorable Harry Reid Senate Minority Leader 528 Hart Office Building Washington, DC 20510 Dear Majority Leader Frist and Minority Leader Reid: We are writing to you today to formally request specific time for floor debate and a vote on our China currency legislation, S. 295. The Senate committed to a vote under the unanimous consent agreement reached in April 2005, and the time has come for us to move forward on our bill. As you know, on April 6, 2005, we offered the text of S. 295 as an amendment to the State Department authorization bill. A motion was made to table our amendment, which failed by a 33-67 margin. Majorities of both parties, as well as majorities on both the Banking and Finance committees, voted against the tabling motion. At the time, we agreed via unanimous consent to delay the vote on S. 295 until the end of July 2005, provided that we receive two hours of debate and an up-or-down vote with no amendments. We also agreed not to offer our bill as an amendment to any other legislative vehicle. Since then, to show our willingness to be flexible and patient, we agreed to delay our vote on three separate occasions. Most recently, in March we agreed to delay a vote for six additional months to give the Chinese additional time to revalue their currency. In short, while we have been determined, we have also been reasonable. Now, the date in the agreement is approaching, and we are sorely disappointed with China’s pace of currency reform. In remarks preceding his trip to China, Treasury Secretary Hank Paulson stated that, “with [China’s] leadership comes responsibility.” China has clearly failed to live up to its international obligations. Since July 2005, when China allowed the yuan to appreciate by 2.1 percent and promised to allow market forces to work, the currency has only appreciated by an additional two percent. In this period, the trade deficit with China continued to accelerate. In August alone, our deficit with China reached $18.8 billion, 33 percent greater than at the same time last year. Despite China’s rhetoric that revaluing their currency will destabilize their economy, we have seen quite the opposite. China’s economy is currently growing at an 11 percent annual rate, and its inflation rate has only been 1.3 percent over the last year. Therefore, we respectfully request that you schedule floor time for debate and a vote on S. 295, as early during the week of September 25 as possible. In addition, given the importance and visibility of the issue, we also ask that you abide by your earlier assurance that the vote on S. 295 not be one of the last orders of business before Congress adjourns for the 2006 elections. Thank you for your consideration. Sincerely, Charles E. Schumer Lindsey O. Graham