Pressing China on Currency Manipulation Takes a Strong, Consistent Message
The Wall Street Journal reports that China’s President Hu Jintao met with a bipartisan group of Members of the U.S. House of Representatives today in the office of Speaker John Boehner (R-OH).
The group met for more than an hour, but only Reps. Boehner and Nancy Pelosi (D-CA) were able to ask questions due to the time limits of back-and-forth translation. The Journal reports that the subjects of discussion included: human-rights violations, intellectual-property protections, and China's "one child" policy.
Unfortunately, there was no discussion of "longstanding complaints that the Chinese government keeps its currency low to dominate its trading relationship with the U.S."
The real question is why currency manipulation was never raised in the meeting.
As a diverse group of economists have pointed out, Beijing's ongoing policy of currency undervaluation is one of the key drivers of the growing U.S. trade deficit with China. A recent EPI study finds that this massive bilateral trade deficit has cost more than 2.4 million jobs since 2001.
Why didn't the Congressional leadership raise the currency issue directly? What's needed is a strong, consistent message in order to show Beijing that their currency peg, which is in violation of WTO law, must end. To make this message effective, both the House and Senate should VOTE on currency soon.
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