A bipartisan group of U.S. Senators recently introduced the Currency Exchange Rate Oversight Act of 2011 to provide recourse for U.S. manufacturers adversely affected by China's ongoing currency undervaluation.

In a letter to the Senate explaining the importance of this legislation, Alliance for American Manufacturing (AAM) Executive Director Scott Paul set the record straight regarding this new legislation:

Myth: Legislation to address currency manipulation would ignore “the many and growing challenges that we face in China.”

Fact: China employs a host of market-distorting practices to gain an upper-hand on American workers and companies, including currency manipulation, inadequate protection of intellectual property, limits on the export of rare earth elements, restrictions on market access such as discriminatory indigenous innovation requirements, and illegal subsidies for state-owned enterprises.
Congress and the administration are working to address many of these issues, but it is absurd to suggest that action on currency somehow dilutes our efforts to combat other unfair trade practices. There is no reason to delay congressional action on currency manipulation, which acts as a massive tax on U.S. exports and as an illegal subsidy on China’s exports. The result has been a bilateral trade deficit that has grown from $83 billion in 2001 to a record $273 billion in 2010.