Press Release: May 13, 2009
Contact:  Michael Stumo, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it or 413.854.2580
 
The Coalition for a Prosperous America applauded the filing of the Currency Reform for Fair Trade Act.  Senators Stabenow (D-MI) and Bunning (R-KY), and Representatives Tim Ryan (D-OH) and Murphy (R-PA) announced the bill at a noon press conference in Washington today.  The bill will classify fundamental currency misalignment as an unlawful export subsidy, enabling countervailing and antidumping duties to be applied as a remedy.
 
“Currency misalignment is a major international trade problem,” said Brian O’Shaughnessy, CPA’s Chief Co-Chair and the chairman of Revere Copper Products in Rome, New York.  “Countries such as China, Japan and South Korea, among others, cause or allow their currencies to be persistently undervalued.  The result is a very large subsidy for their exports to us and a very large tariff for U.S. exports to them.”

According to a July 15, 2009 report released at a CPA Issues Forum meeting, China’s remnimbi was determined 35% undervalued, relative to the U.S. dollar, in comparison to the equilibrium price (using International Monetary Fund methods).  The result is Chinese products being artificially cheap in the U.S. market, and U.S. goods being artificially expensive in the Chinese market.
 
“Free trade does not exist when currency misalignment persists,” said Jack Davis, CPA Board member and President and Owner of I Squared R Element Co. in Akron, New York.  “Many American companies have offshored to those countries because of the noncompetitive price disadvantage caused, in large part, by this currency problem. The result is a loss of millions of U.S. jobs and at least 18,000 companies.”
 
“Farmers and ranchers have to compete with imported products that are artificially cheap because of foreign government intervention, not because of market factors,” said Joe Logan, CPA Co-Chair for Agriculture and Immediate Past President, Ohio Farmers Union.  “Beef products, for example, face an effective tariff in Japanese and South Korean markets because of the currency problems.  America’s net agricultural trade has suffered tremendously as a result.  This bill will help to reestablish a level playing field for American farmers and ranchers.”
 
President Obama endorsed the 110th Congress version of this currency reform bill while a candidate.  The U.S. Treasury declined to cite China as a currency manipulator in its semi-annual report released April 15, 2009.  CPA hopes the administration announces its support for the bill.
 
"The Treasury Dept missed an opportunity to take action on currency misalignment,” said Bob Baugh, CPA Co-Chair for Labor and Executive Director of the AFL-CIO Industrial Union Council.  “It is time for Congress to do so.”
 
CPA is a national, nonprofit organization representing the interests of 2.7 million citizens through its farmer, rancher, manufacturing and organized labor association and company members.  CPA works for a new and positive U.S. trade policy that delivers prosperity and security to America, its citizens, farms, factories and working people.