What have you always wondered about the economy? Tell Us

Pros, cons of protecting against Yuan

Jill Barshay Aug 2, 2007

TEXT OF STORY

Doug Krizner: Treasury Secretary Hanky Paulson was in Beijing this week trying to persuade the China to stop undervaluing its currency. But as Jill Barshay reports, Congress is already taking China’s currency into its own hands.


Jill Barshay: A House subcommittee is holding a hearing today on anti-China currency legislation floating around congress.

Some want a law that would make it easier to punish China with trade sanctions. Senate committees have already passed two bills.

Lewis Leibowitz will be testifying for a coalition of U.S. importers like retail stores. He says he’ll tell lawmakers the proposals will harm the U.S. economy by making Chinese goods more expensive.

Lewis Leibowitz: Altering exchange rates suddenly, you make deals that looked good yesterday, look bad today. You create winners and losers that you never even heard about before. Congress has not yet adequately considered what the consequences of these changes would be.

The Bush Administration agrees and is warning lawmakers they could trigger a global cycle of protectionism.

Lawmakers will also be hearing from manufacturers who are withering under Chinese competition and would like some help from Uncle Sam.

I’m Jill Barshay for Marketplace.

News and information you need, from a source you trust.

In a world where it’s easier to find disinformation than real information, trustworthy journalism is critical to our democracy and our everyday lives. And you rely on Marketplace to be that objective, credible source, each and every day.

This vital work isn’t possible without you. Marketplace is sustained by our community of Investors—listeners, readers, and donors like you who believe that a free press is essential – and worth supporting.

Stand up for independent news—become a Marketplace Investor today with a donation in any amount.