Fair Currency Coalition Praises Reintroduction Of House Currency Bill
The Fair Currency Coalition urges the U.S. House of Representatives to act quickly on this pro-jobs measure. The proposed legislation would deter foreign countries from illegally undervaluing their currencies by making prolonged undervaluation actionable under U.S. countervailing duty (CVD) law.
The newly introduced bill:
- Is the same as H.R. 639, the Currency Reform for Fair Trade Act of 2011, bipartisan legislation from the 112th Congress that garnered 234 cosponsors.
- Is virtually identical to H.R. 2378, the Currency Reform for Fair Trade Act of 2009, bipartisan legislation passed by the U.S. House of Representatives by a 348 to 79 vote in the 111th Congress; and,
- Has a countervailing duty remedy similar to that contained in S. 1619, currency legislation passed by the U.S. Senate by a 63-35 vote the 112th Congress.
The need for action on currency has never been more acute. Every day of delay means more American jobs lost and more new American job creation denied. Illegally undervalued foreign currencies like China's renminbi (RMB) and Japan's yen are unfair export subsidies and trade barriers that discourage new investment needed in America. This lack of investment is evidenced by the fact that although the United States has recovered more than 5.7 million nonfarm jobs since employment bottomed out three years ago, it still has 2.9 million fewer jobs than it did five years ago. Job creation is needed more than ever to help the unemployed as well as to accommodate new entrants into the U.S. workforce.
Looking at China's prolonged illegal currency undervaluation more closely, it also aggravates a perpetual current account deficit that destroys middle-class jobs and plunges America ever deeper into foreign indebtedness. The U.S. bilateral current account deficit with China was $333.4 billion for 2012 and $2.6 trillion for the last decade. Heavily contributing to the record bilateral current account deficit in 2012 was America's $315 billion trade deficit in goods with China, an increase of almost $20 billion from 2011.
Since September 2010, when the U.S. House of Representatives last passed a bipartisan currency bill, China's foreign currency reserves have grown by an estimated $500 billion and now total a staggering $3.3 trillion by the most conservative measures. Moreover, in nominal terms, the RMB has barely increased in value compared to the U.S. dollar, rising by a little more than 5 percent in the past two years.
Despite the continuous engagement and best good-faith efforts of the current and previous administrations, bilateral and multilateral diplomatic talks show no sign of resolving the issue satisfactorily. China's previous leadership ignored every entreaty to meaningfully address the problem, whether in state visits, G-20 talks, or bilateral U.S.-China Strategic and Economic Dialogue discussions. Congressional passage of currency legislation would send a strong signal to China's new leadership that America is serious about fixing currency undervaluation.
The FCC is an alliance of business, agriculture, and labor interests that supports passage of legislation to make prolonged foreign currency undervaluation actionable under U.S. countervailing duty law.
Visit the FCC's website at www.faircurrency.org to see a list of the coalition's supporters and to learn more about the currency issue.
Posted on March 26, 2013
Source: Fair Currency Coalition