Beijing currency saga returns
By Alan Beattie in Washington
Published: September 12 2010 22:26 | Last updated: September 12 2010 22:26
Here we go again. After a brief hiatus over the summer, the Chinese currency saga is returning for its fall season.
This week, the House of Representatives' ways and means committee will convene two hearings, one of which will question Tim Geithner, Treasury secretary.
Congress is deeply unhappy with the progress made since Beijing unpegged the renminbi from the dollar in June. At the time, the concession was enough to damp down congressional ire. An almost visibly relieved US Treasury was able to publish its delayed twice-yearly currency report, which once again held back from naming China as an exchange rate manipulator, without sustaining too much fire from Capitol Hill.
Since then, though, the renminbi has been allowed to rise less than 1 per cent against the dollar, a small fraction of most estimates of its undervaluation. True, Beijing did appear to acknowledge these concerns by allowing a moderate upward jump last week to coincide with the visit of Larry Summers, Barack Obama's chief economic adviser, to Beijing. But unless the White House embarks on a strategy of sending Mr Summers to China every week, it needs to find ways of controlling the anger in Congress.
The congressional campaign has been led by Charles Schumer of New York, the third most senior Democrat in the Senate. His bill would allow the US to use estimates of currency undervaluation when imposing emergency tariffs on imports deemed to be subsidised. This week, the House will produce its counterpart bill, moving the prospect of actual legislation another stride closer.
Yet, the prospects for Mr Schuer's bill remain mired in the uncertainty and complexities of Washington politics. First, it is not clear how far Mr Schumer's campaign is serious intent and how much is theatre. A common view on Capitol Hill is that the crusade is partly inspired by a desire to raise his own profile in the hope of one day succeeding Harry Reid as Democratic leader in the Senate.
Actually passing a bill that triggers a trade war with China and further stokes the wrath of American multinational companies with the Democrats would represent, as the evocative Washington expression has it, the dog that caught the car. There is more political capital to be gained out of continually making noise and threatening legislation than there is from enacting a potentially ineffective and counterproductive law.
Meanwhile, Mr Schumer's counterpart in the House of Representatives, Sander Levin, has long complained about the effect of Chinese currency misalignment on American manufacturing. Yet, at the moment, thanks to Mr Schumer seizing the initiative, he finds himself in the unusual position of having the House act as a voice of judicious reason moderating a combative Senate.
The more that unemployment stays high and anger with China grows, the more that position looks unsustainable. Republicans are much more sceptical of currency legislation. So if, as now seems quite likely, the Republicans retake the House of Representatives in November's midterm elections, the window of opportunity to pass legislation is limited.
The Obama administration will also be wondering how far it can afford to try to stand in the way of legislation it regards as misguided. Hitherto it has generally played good cop to Mr Schumer's bad cop, urging caution. And when faced with an actual decision it has usually eschewed direct confrontation with China. Recently it turned down a request to investigate the use of currency undervaluation when calculating emergency tariffs.
Careful choreography might pay dividends. When Mr Geithner appeared before the Senate finance committee in June, for example, he looked much less willing than hitherto to stand in the way of the torrent of wrath directed at Beijing. Rather than counselling calm to the senators, he warned China of the dangers of an angry Congress. Nine days later, Beijing announced its unpegging of the renminbi. Mr Geithner might well feel that a repeat performance this week might induce Beijing to allow a faster appreciation. It would at least be cheaper and faster than putting Mr Summers back on an airliner.
(转载本文请注明“中国选举与治理网”首发)作者: 明子舟 时间: 2011-4-28 17:52
谢谢作者: hanbaoluri 时间: 2011-5-3 10:50
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