There’s a U.S. trade deficit when it comes to China–a deficit that has eliminate eliminated or displaced nearly 2.8 million U.S. jobs since 2001.
Senator Lindsey Graham is working on a bill to address that, saying “They’re cheating Americans out of market share. They are destroying our manufacturing community–not because they’re smarter and work harder, but because they manipulate the value of their currency. They peg the yuan of the dollar–6.31 to a dollar is 40 percent below its true value,” says Graham.
Graham says China is producing “cheap money.”
“Forty percent below its value means that every product in China made and sold in the world market has a 40 percent discount–it’s called currency manipulation. Our trade deficit is $273 billion. They are too big of an economy to allow to cheat. The IMS says their currency is substantially undervalued and it is destroying our American manufacturing sector,” says Graham.
Graham explains why he thinks China would lower their trade value.
“They’re an exporting nation. They get a ton of money selling cheap exports throughout the world. The cheaper their money, the cheaper their products. They’re raking in millions and billions of dollars. They’re hoarding our cash. They’re expanding their military. If China outworks us and they can do things better based on free-market principles, then so be it,” says Graham.
The senator says China’s “cheap” trade hits future business in South Carolina directly.
“If they start building airplanes and cars. Boeing is a God-send to South Carolina. Boeing wants to sell planes to China. I want China to buy Boeing planes, but if China starts making planes in 2016 and their plane is 30 percent below Boeing’s cost because of currency manipulation–you’re going to destroy our whole economy,” says Graham.
Graham says it simply comes down to China being “addicted to cheap exports,” and he says the currency manipulation allows China to trade “unfairly.”