Grassley: Give Trump leeway on China

DAVENPORT - U.S. Sen. Chuck Grassley said Tuesday he would give President Donald Trump 'leeway” in hedging on declaring China a currency manipulator.

The key, the Iowa Republican said, is whether backtracking on the currency manipulation claim helps in dealings with North Korea.

Grassley, R-Iowa, who long has called for aggressive White House action against China for its monetary policies, was in Davenport for a meeting with the Quad-Cities Morning Optimists Club.

There, he answered a range of questions for about an hour at the Hickory Garden Restaurant in northwest Davenport.

Grassley said that even though Trump had pulled the U.S. out of the Trans-Pacific Partnership, he thought the president has 'backed off” somewhat from his campaign promises on trade. Grassley said he thinks the administration would be 'cautious” about renegotiating the North American Free Trade Act, and he pointed to the administration's decision last week not to label China a currency manipulator.

During the campaign, Trump argued that the U.S. has been on the short end of trade deals and that he would be more aggressive, including labeling China a currency manipulator.

Last week, however, the president told The Wall Street Journal that China has not been guilty of manipulating the yuan. During the weekend, he suggested in a tweet that part of the reason for the revised stance is that China could be helpful in deterring North Korea.

'If that's possible that he's successful in doing that, I guess I would give him some leeway,” Grassley told the club.

Afterward, the senator told reporters if there wasn't progress, he still thinks Trump will follow through on his promises.

'If it doesn't make progress after a short period of time, I'm sure, based upon what he said during the election, he's going to have to label them a currency manipulator,” he said.

China's critics say the country's manipulation of its currency has prevented American farmers and manufacturers from gaining market access.

Senate Democratic leader Chuck Schumer of New York said Trump has it backward on the issue. He said China would be more cooperative on North Korea if the U.S. took a tougher trade stand.

Also Tuesday, Grassley said voters already have passed judgment on whether Trump should release his tax returns.

Democrats have made the president's refusal to do so an issue, with some of his critics arguing they should know whether the president will personally benefit from any reform bill.

Grassley said the issue has been settled.

'I think that was litigated very much during the election,” he said.

Trump won in the Electoral College but lost the popular vote by almost 3 million votes.

Grassley added that if Democrats refuse to cooperate on a tax reform bill, the Republicans would pass a tax bill under rules requiring only 50 votes for passage.