Obama aide criticizes Romney tough talk on China

Mitt Romney (left) and President Barack Obama (right), the two candidates in the upcoming US elections.

WASHINGTON - An adviser to President Barack Obama warned Wednesday that Mitt Romney could set off tensions with China if elected, as the Republican challenger vowed a tough line on issues from trade to human rights.

Representatives from the two campaigns held a debate on China policy ahead of the November 6 election in the wake of charges by Romney that the Democratic president has shown too much deference toward the rising Asian power.

Jeff Bader, who was Obama's top aide on East Asia until last year and serves on a committee of his re-election campaign, attacked Romney's repeated pledge that as president he would immediately brand China as a currency manipulator.

"The idea of doing it on the first day in office I find, frankly, astonishing," Bader said at the debate held by the Committee of 100, a Chinese American group, and Johns Hopkins University's School of Advanced International Studies.

Bader, while not ruling out using the threat of such action to pressure China, said that Beijing will "not be in a passive or submissive mood" considering that a new leadership is taking over in the new year.

"The Chinese will retaliate, this I can guarantee. The Chinese do not take these things quiet. This will prejudice relations from day one," Bader said.

US officials accuse China of deliberately keeping its yuan low to flood the world with cheap exports, devastating US manufacturing. Treasury Secretary Timothy Geithner has preferred quiet diplomacy instead of a formal declaration of currency manipulation, which could lead to punitive action.

Aaron Friedberg, co-chair of the Romney campaign's Asia-Pacific working group, said that the United States should not be "paralysed" by fear of China's response, repeating Romney's assertion in a debate with Obama on Monday that the world's two largest economies effectively were already in a trade war.

"Labeling China a currency manipulator would not trigger Armageddon," Friedberg said at the debate.

"It would put China on notice, it would begin a process of discussion and ultimately negotiation between the United States and China and, if necessary, it would be followed by the imposition of countervailing duties on some products on a sliding scale," he said.

The yuan has appreciated by around 30 per cent against the dollar since 2005, although many analysts believe that China was responding mostly to inflationary pressure. Bader said he hoped the yuan would rise further.

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