Yesterday’s release of Chinese trade data was just what Senator Schumer needed to refresh the populist agenda on Reminbi revaluation. Treasury Secretary Tim Geithner made an appearance before the Senate Finance Committee where Schumer exhibited his credentials as a fighter for American jobs. Remember that the senior senator from New York is vying for Senate leader just in case Harry Reid should lose his election in November. Geithner was challenged as to why the Treasury Department did not name China a currency manipulator and even stated that the Treasury maay in fact be contravening U.S. law.
The rhetoric of political expediency may create trade frictions that will be difficult to halt. It will not be a pleasant G-20 meeting as the U.S. goes on the trade offensive against the premier BRIC nation. There are a few stories out tonight that the Chinese have already agreed to allow a moderate Reminbi appreciation and the rhetoric may only be political posturing by Schumer in an effort to look as if it was his strong rebuke that got the Chinese to move on the currency.
Geithner defended the Chinese for the robust growth in imports from the U.S. and others but seemed very unsettled by the verbal barrage laid upon Geithner. The world is in a very fragile state and the move to punish the Chinese is not the best of plans. The Europeans are looking at the U.S. as a model as they institute fiscal austerity. But as the job losses mount, how long will it be before the protectionist drums begin to beat from Brussels? U.S. leadership is needed to keep world trade growing. The U.S. needs to be a voice of reason, not hysteria, before the world heads into the realm of beggar thy neighbor.
Tags: BRIC, China, G-20, Reminbi, Senator Shumer, Tim Geithner
June 10, 2010 at 11:50 pm |
just before checking my inbox i was looking over material suppliers in china. it seems ironic that i read only moments later that the chinese are moving to revalue the currency. where are steam ship rates from china to us headed?
June 11, 2010 at 12:13 am |
But beggar thy neighbor is good for you if your job doesnt get outsourced to a mercantilist nation. Maybe this what the US needs to do to keep high paying jobs. A little payback from wall street to main street?