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Momentum Building for Action on China Currency Manipulation
The momentum is building for the United States to take strong action to counteract manipulation of its currency by China’s government.
More than 130 members of Congress signed on to a letter from Reps. Mike Michaud (D-Maine) and Tim Ryan (D-Ohio) delivered today that urges Treasury Secretary Timothy Geithner and Commerce Secretary Gary Locke to take strong action up to and including countervailing duties (CVD) or tariffs because of currency manipulation.
Michaud and Ryan’s letter is the latest in growing calls by Congress and by top economists for the United States to act on the manipulation of currency by China’s government. If Geithner does act, the administration could impose remedies, such as tariffs, to create a fairer trade balance with China.
AFL-CIO President Richard Trumka, who co-chairs the Fair Currency Coalition, thanked Michaud and Ryan for their letter:
The working families of this country need jobs now. If we want a recovery that will invest in manufacturing, boost exports, balance trade, and create jobs we must stop China and other countries from illegally manipulating their currency. China’s prolonged undervaluation…is an illegal export subsidy. That is why the U.S. government must allow CVD cases to proceed. American workers expect their government to stand up for them.
The AFL-CIO, U.S. manufacturers and many economic experts maintain that China deliberately undervalues its currency to keep the value artificially low so it can boost exports and discourage imports—running up the U.S. trade deficit and costing U.S. jobs.
An AFL-CIO report shows China’s fixed currency rate artificially lowers the price of its goods by 40 percent, effectively subsidizing China’s exports, putting U.S. companies at a competitive disadvantage and creating a record trade deficit.
Several experts, including Nobel Prize-winning economist Paul Krugman and United Steelworkers USW President Leo Gerard, on Friday told a forum on “Currency Manipulation: How Should the U.S Respond?” trade remedies are what we need. The forum was co-sponsored by the Economic Policy Institute (EPI) with the Alliance for American Manufacturing (AAM).
China’s currency manipulation has cost between 1.5 million and 3 million good American manufacturing jobs. C. Fred Bergsten, director of the conservative Peterson Institute for International Economics, told the forum:
If there is going to be a serious jobs program, the exchange rate of the dollar must be at the center of the debate.
The Fair Currency Coalition also called this week for Congress and the Obama administration to take a strong stand against currency misalignment because it threatens our national security. The coalition, which includes business and labor groups, said in a statement:
The results of Beijing’s policy…have created a serious and growing threat to national security. The capital and technology transferred to China and the production capacity built and sustained in China by Beijing’s export surplus have been used to expand the size and capabilities of the People’s Liberation Army. Over the past decade, annual military expenditures have risen by more than 400 percent.
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5 Comments
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If we were not controlled by economic domination, the Senate would have passed enviromental legislation in 2008, created and passed by the house 395-7. This would have forced the foreign shipping industry to retrofit ships with ballast water technology to American standards of law with a strong timeline and not those currently being purposed by the commander and chief through the military plan of 20 plus years. A recent report for the 111th Congress tells how this legislation would increase the cost of foreign manufactured goods being imported into our country. It would help to make manufacturing in the US more cost competative, creating jobs. The report states that the 111th Congress may again take up the issue. As there are those who worry this would cause inflation they should be informed of the Ponzi scheme set up by previous administration allowing China to peg the value of their currency to ours. This “arrangement” sets a value of the Chinese currency we accept for the treasury notes we keep creating for alledged “auction” on the international market, creating a way to manipulate cheap foriegn made goods by statistical control and provides poplitician the means to offer entitlements for votes while increasing national debt. Without creating economic revenues capable to pay for national debt in the form of JOBS that will not go away, we will only deteriorate our freedom and independence further. This administration appears through it Coast Guard plan that mirrors the International Maritime Organization to be following the same course as previously charted. China being the largest ship builders in the world and major player in the IMO should not be the one who decides through economic domination our environmental laws, so the manufacturing remains in there country while hiding their carbon emmissions. Strong manufacturing jobs for everyday Americans is the only way to preserve our independence and freedom if it is not to late.
Don Mitchel is right on. I might add that our representatives in Congress and Senate don’t have nearly the amount of information to make informed decisions regarding the currency valuation by the Chinese government. Policy transactions between our central bank- The U.S. Federal Reserve Bank- and foreign central banks are not audited or provided to our representatives and therefore the american people. This can only change by allowing an audit of the federal reserve transactions by supporting HR 1207. Call your Congressman and Senator and tell them to “Audit the Fed.” Let’s get this currency manipulation in order.
Soon it will be saber rattling to get the U.S. manufacturers and politicians message across. Just what right does the U.S. have to tell any country how to value it’s currency? The only thing this country has going for it is the most destructive military on the planet that holds it’s guns to the head of any country that dare threatens “their” capitalists profits. The AFL-CIO leadership acts as the tail of the Democratic donkey in this entire game setting up the U.S. for a major confrontation that IT WILL LOSE and most all we, as working people, will lose. Putting Democratic Party politicans forward as some sort of authority for our lives is traitorous and until the labor movement of this country splits from the Democrats and helps build a workers party to take on the capitalists we will be prisoners of the war parties of capital. Hands off China! Hands on the capitalist throats.
by the actions of our past presidents and Congress, we are almost on the brink of becoming a satellite nation of China. This country has been sold out and given away by the politicians.
It’s a scary thought to know that Communist China owns over $800 billion of our debt in Treasury bonds. They could sink our economy by the stroke of a pen.