OPINION: Action on currency manipulation can boost manufacturing jobs in Michigan
Scott Paul, President of the Alliance for American Manufacturing (AAM), contributed an opinion today to the Detroit News on the problems that U.S. auto manufacturers face from foreign currency manipulation.
Both China and Japan hoard massive reserves of American dollars, which helps inflate the value of the dollar while artificially lowering the value of their own currencies. Doing so acts as a hidden tax on American goods entering lucrative Asian markets and a subsidy for Chinese and Japanese goods entering the U.S.
This isn’t an economic theory, it’s an economic fact: By distorting the market with rigged currency, our economic rivals have run up America’s trade deficits to the tune of hundreds of billions of dollars annually. It is our companies and our workers who pay the price.
Paul says that Washington must act:
Now here’s a bit of good news: Our politicos are starting to get serious about cracking down on trade cheats. While the administration negotiates the terms of a massive new Trans-Pacific Partnership, 230 members of Congress signed a letter to President Barack Obama urging him to ensure its benefits would not be eroded by Japan’s currency manipulation. Almost every member of Michigan’s Congressional delegation added their name to that letter.
But our lawmakers have it in their own power to do more. They need to co-sponsor the bipartisan Currency Reform for Fair Trade Act, which would allow businesses to file trade cases based on injury from China’s currency manipulation.
Read more about the state of manufacturing in Michigan.
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