Obama launches new China trade action

[September 17, 2012]  WASHINGTON (AP) -- President Barack Obama is launching a new trade enforcement case against China as he seeks an advantage over Republican rival Mitt Romney on an economic issue that has become a flashpoint in the presidential campaign.

Senior administration officials said Obama will announce the new action, targeting Chinese subsidies for exports of automobiles and automobile parts, Monday during a campaign trip to Ohio. The swing state has a large manufacturing base where many blame China for depressing its industry. The officials requested anonymity because they were not authorized to discuss the trade action publicly ahead of the president.

Obama's announcement comes as both campaigns have pushed China -- and the economy -- to the forefront of the White House race as they seek to refocus after a week dominated by foreign policy and the turbulent events at U.S. embassies throughout the Middle East.

Romney on Monday was targeting his economic message to Hispanics, a key voting bloc with whom Obama enjoys an advantage.

"Many Hispanics have sacrificed greatly to help build our country and our economy, and to leave for their children a brighter future," Romney said in excerpts released ahead of his speech to the U.S. Hispanic Chamber of Commerce. "Today, those sacrifices are being squandered by a president who cannot stop spending."

Romney said his test on federal spending would be whether a program is "so critical that it is worth borrowing money from China to pay for it."

Romney has accused Obama of being weak on China and ceding American jobs to the rising Asian power. The president countered with claims that Romney has investments in Chinese companies and outsourced jobs to China while running the private equity firm Bain Capital.

On Monday, Obama was turning to the power of incumbency to try to gain the upper hand on the debate.

Officials said the administration will launch enforcement action at the World Trade Organization because it says China is illegally subsidizing exports in their autos and auto parts sectors. The U.S. says the practice puts American parts manufacturers at a competitive disadvantage and encourages the outsourcing of production to China.

The administration is taking the issue to the WTO because its attempts to get China to address the subsidies on its own have been unsuccessful, the officials said.

Jobs in the U.S. auto parts sector dropped by roughly half between 2001 and 2010, while U.S. imports of auto parts from China have increased seven-fold, according to the Obama administration.

The administration is also escalating another case it brought against China at the WTO in July that accuses China of imposing unfair duties on more than $3 billion in exports of U.S. autos. The duties cover more than 80 percent of American auto exports to China, said the officials, who requested anonymity in order to discuss the trade action ahead of the president.

The cases stem from the Interagency Trade Enforcement Center Obama set up earlier this year to target unfair practices around the world, particularly in China.

Obama and Romney started trading barbs on China late last week.

Romney released a television advertisement Thursday accusing Obama of "failing American workers" and ignoring unfair trade practices by China. And in his weekly podcast Saturday Romney said that "In 2008, candidate Obama promised to take China `to the mat.' But since then, he's let China run all over us."

Obama countered with a TV spot focused on its claims that Romney outsourced jobs to China while working in the private sector. His campaign also released a new web video Saturday in which Obama deputy campaign manager Stephanie Cutter said Romney holds investments in Chinese companies.

The maneuvering came as a new national survey by The New York Times and CBS News found that Romney has lost his long-standing edge on the question of who voters view as most likely to restore the economy and create jobs. Despite that, the poll found the race narrowly divided.

Romney's shift to China also indicated a need to shore up support among the working-class voters he needs to turn out in big numbers come November. Obama's quick counter underscored the importance of holding onto his recent gains in manufacturing-heavy Ohio.

Obama has campaign rallies planned Monday in Cincinnati and Columbus. The president was raising campaign cash in New York on Tuesday, followed by events in Florida on Thursday, Virginia on Friday and Wisconsin on Saturday -- all states that Obama carried in the 2008 election. Obama was making his first trip to Wisconsin in months and his most pronounced pitch to voters there since Romney added Wisconsin Rep. Paul Ryan to the ticket. Wisconsin has not voted for a Republican presidential candidate since President Ronald Reagan in 1984 and is considered one of Romney's most enticing electoral targets.

Romney's itinerary this week included fundraising stops in the Los Angeles area Monday. In addition to his address to the United States Hispanic Chamber of Commerce, he was also reaching out to Latino voters in an interview with Spanish-language television network Telemundo. The network interviewed Obama last week.

Romney was also expected to hold fundraising events in Utah and Texas before heading to Florida for fundraisers later in the week.

[Associated Press; By JULIE PACE]

Associated Press writer Ken Thomas in Los Angeles contributed to this report.

Follow Julie Pace at http://twitter.com/jpaceDC.

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