US President Barack Obama dismissed Mitt Romney’s tough talk on China at their second debate, as the two sparred over how to handle ties with the world’s number two economy.
China policy has emerged as a key issue in the race for the White House, with Obama mocking his foe’s record of making money on overseas investments and Romney countering that the Democratic incumbent has been soft on Beijing.
“Governor, you’re the last person who’s going to get tough on China,” Obama said at Tuesday’s debate after Romney repeated his promise to crack down on Beijing over its widely criticized trade practices and currency policy.
“When he talks about getting tough on China, keep in mind that Governor Romney invested in companies that were pioneers of outsourcing to China, and is currently investing in companies that are building surveillance equipment for China to spy on its own folks,” Obama said.
Obama’s aggressive response may have referred to a story his campaign has highlighted recently — a New York Times article from earlier this year that laid out how Bain Capital, the private equity firm founded by Romney, was profiting from investments in Chinese companies.
The Times detailed how a Bain-run fund in which a Romney blind trust has holdings bought the video surveillance division of a Chinese firm that says it is the largest supplier to a monitoring system that allows Beijing to watch over schools, hospitals, and theaters.
In a web video released last month, the Obama campaign also accused Romney of investing in Youku, the Chinese equivalent of YouTube, which it described as a haven for pirated US videos, and of backing a Chinese firm accused of pirating Microsoft software.
Romney made a point of returning to the issue of China multiple times during the fiery town hall-style debate at Hofstra University in New York — the second of three debates before the November 6 vote.
“China has been a currency manipulator for years and years,” Romney said, lambasting Obama for not labeling Beijing as such.
“On day one, I will label China a currency manipulator… We’ll make sure people we trade with around the world play by the rules.”
Obama fired back, saying the yuan had appreciated during his time in office “because we have pushed them hard, put unprecedented trade pressure on China, and that will help create jobs here.”
Critics in the United States and other developed economies accuse Beijing of deliberately devaluing its currency to boost its exports, devastating the manufacturing industry elsewhere.
The Obama administration has repeatedly urged Beijing to let the yuan appreciate, but has stopped short of declaring China a currency manipulator — a designation that could trigger sanctions and perhaps an all-out trade war.
The Chinese yuan hit a record high against the US dollar on Friday — 6.2640 to the greenback — in what analysts said could be a response to US political pressure.
The world’s two biggest economies have lodged a number of complaints against each other in the World Trade Organization — part of Washington’s bid to use trade rules to tamp down China’s huge bilateral trade surplus.
Romney did not shy away from the issue of his own foreign investments.
“Any investments I have made over the last eight years have been by blind trusts and they include investments outside of the United States, including Chinese companies,” the Republican White House hopeful said.
He then challenged the president. “Have you looked at your pension?” he said, adding that Obama too has investments in China.
“I don’t look at my pension,” Obama shot back. “It’s not as big as yours. I don’t check it that often.”
