The Christian Science Monitor looks at the simmering dispute with China over its currency from the perspective of American workers:
The bipartisan support of Maine’s paper industry illustrates a shift in attitudes toward trade with China that is taking place in Washington. Legislators from both sides of the aisle, frustrated by years of conversations with China over the deep imbalance in trade activity between the two countries, and concerned over plant closings in their districts, are beginning to take action.
“In the US there is a combustible mix of midterm elections, a rising trade deficit, and the weak jobs picture,” says Eswar Prasad, a professor of trade policy at Cornell University in Ithaca, N.Y., and a former head of the International Monetary Fund’s China division.
On Sept. 29, the House, in a bipartisan vote, passed legislation aimed at China’s management of its currency, the yuan. For years, as the Chinese exported goods to the United States, they were paid in dollars, which they have invested in US Treasury bills. But rather than let the market decide the yuan’s value, the Chinese kept it at a level that US administrations have deemed artificially low. This helps Chinese exports remain competitive and makes US goods in China more expensive.
…But, as the White House is learning, China is unhappy with the US, too.
For example, in late September, China increased its tariffs on poultry imports from the US from 31.4 percent to 105.4 percent. The Chinese had started their investigation into US poultry prices almost immediately after the Obama administration a year ago had imposed heavy tariffs on Chinese tires.
