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AAM’s 2010 U.S.-China S&ED Index
S&ED Talks Should Focus on China’s Currency Manipulation
Washington, DC – On May 24-25, 2010, Treasury Secretary Geithner and Secretary of State Clinton will be in Beijing for bilateral discussions with their Chinese counterparts as part of the Strategic & Economic Dialogue (S&ED). China’s practice of maintaining an undervalued currency has grabbed the attention of U.S. policymakers, academics, businesses, and jobless workers because it creates an uneven playing field in the U.S.-China trade relationship.
Despite broad consensus that China’s deliberate intervention in the currency market is occurring and that it hurts American interests, the Obama Administration has delayed a report due to Congress on April 15 in which it was required to list countries with a misaligned currency. More time for discussion is needed, they said. Meanwhile, Chinese officials have stubbornly dismissed calls for a more market-oriented exchange rate policy and have even suggested that it is “protectionist” for the U.S. to even suggest doing so.
Here is what’s at stake:
Number of U.S. jobs lost or displaced due to U.S.-China trade imbalance, 2001-2008
Number of Congressional Districts in U.S. [out of 435] that have lost jobs to China based on trade flows
China’s percentage share of overall U.S. trade deficit in non-petroleum goods, 2009
Ratio of Chinese imports to U.S. exports in bilateral trade relationship
Yuan/Dollar exchange rate peg for the past 22 months
Estimated percentage by which the Yuan is undervalued compared to the dollar by the Institute for International Economics
Estimated dollar value of China’s treasury holdings
Estimated Dollars/month that China is adding to its $2.4 trillion in foreign currency reserves
Percent reduction in global growth caused by China’s surpluses and currency policy, estimated by Paul Krugman
Additional lost U.S. jobs if China does not substantially revalue its currency, estimated by Paul Krugman
Jobs Fred Bergsten estimated would be created by increasing the Yuan’s value by 40 percent
Jobs Fred Bergsten estimated would be created by increasing the Yuan’s value by 25 percent
Senators voting for the Schumer-Graham amendment which would have placed punitive tariffs on Chinese imports in 2005 unless it revalued its currency; China began floating its currency within weeks
Percent tariff Nobel Prize economist Paul Krugman recommends imposing on China’s goods to compel a flexible exchange rate
Budget cost if the U.S. were to take action to offset China’s currency manipulation advantage with countervailing duties
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The Alliance for American Manufacturing is a unique non-partisan, non-profit partnership forged to strengthen manufacturing in the U.S. AAM brings together a select group of America’s leading manufacturers and the United Steelworkers to promote creative policy solutions on priorities such as international trade, energy security, health care, retirement security, currency manipulation, and other issues of mutual concern. For more information: www.americanmanufacturing.org.
