New report says unfair China trade costs local jobs
The growing trade deficit between the United States and China eliminated or displaced an estimated 2.4 million jobs in the U.S. between 2001 and 2008, according to a new report from the Economic Policy Institute, Washington, D.C.
The report, "Unfair China Trade Costs Local Jobs," shows that every state in the country, as well as Washington, D.C. and Puerto Rico, suffered jobs lost or displaced because of the trade imbalance. The deficit grew by an average of $26.6 billion each year between 2001 and 2008; Chinese exports to the United States in 2008 were more than five times greater than U.S. exports to China, according to a March 23 EPI release.
A major reason for the trade imbalance is China’s artificially low currency value, EPI officials claim. While the value of its currency should have increased as China exported more and more goods, it has instead remained artificially low, a result of China’s aggressive efforts to manipulate the currency by acquiring more than two trillion dollars in foreign exchange reserves since 2001. This currency manipulation gives China an unfair advantage in global trade,according to the release.
“We have allowed the Chinese government to game the system for far too long, with serious consequences for the U.S. economy,” said the report’s author, EPI economist Robert Scott, in the release. “The Treasury Department should publicly declare China to be a currency manipulator, and the Congress should authorize tariffs of at least 25 percent if China doesn’t start playing by fair rules.”
Read the full release.