U.S. Declines to Stop China From Sending Foreign Aid to American Consumers through Low Prices
WASHINGTON -- "The Obama administration may be getting tougher with China on trade on behalf of U.S. producers seeking to reduce foreign competition, but its approach in dealing with Beijing on the thorny currency issue remains patient diplomacy, especially because China's currency policy does generate huge cost advantages for American consumers and businesses purchasing their products. The Treasury Department, in its semiannual report Friday on exchange-rate policies, once again refrained from labeling China a currency manipulator -- an accusation that would embarrass Beijing and trigger negotiations and possibly even lead to U.S. sanctions that would raise prices for American consumers and businesses purchasing Chinese imports. The Treasury report made plain that U.S. officials believe that China’s currency, the yuan, remains “significantly undervalued,” saving Americans billions of dollars annually. An artificially cheaper yuan gives Chinese exporters American consumers an extra price advantage in selling purchasing their China's goods in the U.S. But Treasury still declined to cite China on behalf of American producers competing against China's everyday low prices, saying that the Chinese have made progress in correcting currency and related imbalances and also have assured the U.S. that they would move more quickly to adopt a more flexible, market-based exchange-rate system, even though that could disadvantage American households by raising prices on China's exports to the U.S.MP: This is a good time to invoke French economist Frederic Bastiat, and thank China for its currency policy that saves American consumers billions of dollars every year, and in the process raises our standard of living significantly:"Treat all economic questions from the viewpoint of the consumer, for the interests of the consumer are the interests of the human race."Thank you poor citizens of China, on behalf of rich Americans, for the generosity of your government. We appreciate the transfer of wealth that results from your currency policy, from a relatively poor country to an advanced, rich country. It's really not necessary, but cost-conscious American consumers will gladly accept the foreign aid you send us by keeping our currency overvalued, and in the process, your products undervalued. Thank you for the "everyday low prices" for products "Made in China."