WASHINGTON, D.C. – With the Chinese yuan reaching its lowest level in nearly one year, U.S. Sen. Sherrod Brown (D-OH) today called on Congress to pass his bipartisan plan that would crack down on currency manipulation. Last month, Brown pointed to a new report showing that cracking down on currency manipulation could create 5.8 million jobs in the U.S., including more than 250,000 jobs in Ohio alone. Brown, who is the lead sponsor of a bipartisan bill that would stand up for American manufacturers by punishing countries like China that cheat by manipulating currency, urged Congress and the Obama Administration to crack down on currency misalignment.
“As the Chinese government continues to push down the value of the yuan, the urgency for passing our bipartisan bill addressing currency manipulation rises,” Brown said. “We can create millions of jobs—without adding a dime to the deficit—by fighting back when our trading partners cheat. Ending currency manipulation could create 5.8 million jobs for Americans and more than 250,000 jobs for Ohioans. Congress should stand up for American workers by passing our bipartisan bill.”
Brown’s bipartisan legislation, the Currency Exchange Rate Oversight Reform Act, would use U.S. trade law to counter the economic harm to American manufacturers caused when countries unfairly undervalue their currency to give their exports an unfair price advantage. The bill would provide consequences for countries that fail to adopt appropriate policies to eliminate currency misalignment—all without adding a dime to the federal budget.
The new national report by the Economic Policy Institute (EPI) found that ending currency manipulation could reduce the U.S. trade deficit by as much as $500 billion within three years, increase GDP by as much as $720 billion, and create as many as 5.8 million American jobs—all while reducing the federal budget by as much as $266 billion. The report concluded that, “ending currency manipulation is the best available tool for stimulating demand for domestic output and ending the hangover of excess unemployment from the Great Recession.”
The new Ohio specific report by EPI found that ending currency manipulation could:
- Create more than 250,000 Ohio jobs;
- Reduce Ohio’s unemployment rate by up to 2.7 percentage points;
- Create up to 75,900 Ohio manufacturing jobs;
- Increase Ohio’s Gross Domestic Products (GDP) output by up to $17.4 billion; and
- Raise up to $3.7 billion for Ohio and its local communities as output growth leads to increased tax revenues and spending reductions.
Further, a December 2012 report by the Peterson Institute for International Economics concluded that currency manipulation by foreign governments had cost the U.S. from 1 million to 5 million jobs and increased the U.S. trade deficit by $200 billion to $500 billion per year. With the Administration currently negotiating provisions of the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP), Brown urged President Obama not to support trade deals that fail to level the playing field for U.S. manufacturers by punishing currency manipulators.
The Currency Exchange Rate Oversight Reform Act is endorsed by, among others, the American Federation of Labor and Congress of Industrial Organizations (AFL–CIO), Alliance for American Manufacturing (AAM), American Iron and Steel Institute (AISI), Coalition for Prosperous America (CPA), Fair Currency Coalition, National Council of Textile Organizations (NCTO), National Tooling and Machining Association (NTMA), Precision Metalforming Association (PMA), and United Steelworkers (USW).