By Brai Odion-Esene

WASHINGTON (MNI) – President Obama Monday said China, despite its
promises, has not done everything that it could to allow its currency to
appreciate, and warned that the U.S. government will aggressively use
all the tools at its disposal, especially international trade lows, to
even the odds.

Speaking at a town hall event hosted by business channel CNBC,
Obama was asked if it is time for the administration to be tougher on
pressing China in regards to its currency.

He noted in response that the yuan is valued lower “than market
conditions say it should be.” The administration, he continued, has
pushed China to allow its currency to rise in accordance with its
expanding economy, rising exports and growing wealth.

“They have said ‘Yes’ in theory, but in fact they have not done
everything that needs to be done,” the president said.

“We are going to continue to insist that on this issue, and all
trade issues between us and China, that it’s a two-way street,” he
assured.

Obama said it is good for the country that China does well,
considering it is a huge market where U.S. businesses can export a lot
of goods. But the trade relationship between both countries “has to be
fair,” he added.

In order to bring about a more level playing field, Obama noted the
U.S. is bringing more actions against China before the World Trade
Organization, and that “we are going to enforce our trade laws much more
effectively than we have in the past.”

The goal is to make sure that trade is good for both American
businesses and their workers, he said, “and over the last several years
it hasn’t always been” the case.

President Obama, in responding to questions, also praised the work
done by his economic team, adding that, right now, he has no plans to
implement major changes to key positions within his administration
following the mid-term elections.

In light of the departures of budget director Peter Orszag and
Chair of the Council of Economic Advisors Christina Romer, Obama was
asked if he would ensure Treasury Secretary Timothy Geithner and top
economic advisor Larry Summers remain in their posts until the end of
his term.

“I have not made any determinations about personnel,” Obama said.
“I think Larry Summers and Tim Geithner have done an outstanding job, as
have my whole economic team.”

Obama also used the event to reiterate his stance on the hotly
debate issue of the federal debt and deficit.

While the massive spending during the downturn was necessary in
order to prevent a much worse recession, the administration is now
committed to deficit reduction, the president said.

“We’ve already identified $250 billion in cuts on the discretionary
side of our budget,” he said, “we’ve identified $300 billion worth of
loopholes in our tax code that are not helping economic growth.”

“If we just did those two things — as I’ve already proposed,”
Obama added, “that would make a huge difference.”

He highlighted other deficit reduction proposals the administration
has put forward, including the plan to limit the extension of the 2001
and 2003 Bush tax cuts to only those Americans making less than $250,000
a year.

Considering the devastating impact the recession had on America’s
middle class, “everybody agrees that this should be done,” Obama said.

Extending the tax cuts as well for those making above $250,000 a
year, Obama repeated, would cost $700 billion. “It is an irresponsible
thing for us to do.”

Asked if he would be open to a compromise that would extend the tax
cuts for those making less than $1 million a year, while still allowing
the government to capture its revenue, Obama replied, “I can’t give tax
cuts to the top two percent of Americans … and lower the deficit at
the same time.”

Instead, Congress should move on extending tax cuts for the middle
class, get the economy moving as well as growing faster, and then, Obama
said, if at some point in the future “if we want to have discussions
about further lowering tax rates, let’s do so at a time we can actually
afford it.”

** Market News International Washington Bureau: 202-371-2121 **

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