the visible hand

it is the theory which decides what can be observed – einstein

Congress Pimps for Wall Street

Posted by ecoshift on August 15, 2007

Congress Pimps for Wall Street
By Albert Keidel
Special to washingtonpost.com’s Think Tank Town
Thursday, August 16, 2007; 12:00 AM

The current bill on China’s exchange rate that is working its way around Capitol Hill will do nothing to help the U.S. trade deficit or U.S. jobs. It will instead encourage speculators to buy into Wall Street China schemes. The bill, with noisy encouragement from New York, pretends to protect American trade and labor interests, but would succeed only in micromanaging the Treasury Department by imposing unworkable rules for identifying currency manipulators. This is but the latest, shameless push in an effort begun five years ago to bully China into forcing currency movements large enough for speculators to cash out millions in unearned profits.

Many have accepted by now, and at least one sponsor of these various current bills has admitted, that even a major change in China’s exchange rate will not affect the U.S. trade deficit. America’s trade red ink reflects U.S. domestic factors, such as credit card overload, high consumption levels and low family savings rates. And a major boost in China’s currency will not restore American jobs lost to the relentless march of technology. Chinese imports have not reduced American manufacturing output. On the contrary, output is growing very well, thank you. But the U.S. is constantly saving on labor costs, as it has been for decades — long before China’s trade came on the scene.

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